AJAY SINGHAL,DELHI vs. ITO, NEW DELHI

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ITA 428/DEL/2015Status: DisposedITAT Delhi31 August 2016AY 2007-083 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the disallowance was incorrect as the assessee had provided proof (bill of lading) showing the local entities were agents of foreign shipping companies. The disallowance was deleted based on a precedent.

What were the facts?

The assessee claimed deduction for freight and forwarding charges paid to local shipping agents of foreign companies. The Assessing Officer disallowed these expenses under Section 40(a)(ia) for non-deduction of TDS.

What were the issues?

Whether disallowance under Section 40(a)(ia) is justified for freight and forwarding charges paid to local agents of foreign shipping companies when TDS was not deducted.

Which sections of the Income-tax Act were involved?

Section 40(a)(ia),Section 172

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCHES : SMC-3 : NEW DELHI

Before: SHRI J. SUDHAKAR REDDY

For Appellant: Shri Sunil Kumar Gupta, CA
For Respondent: Shri Anil Sharma, Sr. DR
Hearing: 30.08.2016Pronounced: 31.08.2016

ORDER This appeal filed by the assessee is directed against the order of the CIT(A) dated 14.10.2014 for the assessment year 2007-08.

2.

The addition contested before me is by way of disallowance made u/s 40(a)(ia) on account of non-deduction of TDS on freight and forwarding charges paid to local shipping agent of foreign company. The ld.CIT(A) has confirmed the disallowance on the sole ground that the assessee has failed to furnish details that M/s Schenkar India Pvt. Ltd. was the agent of foreign shipping company and as to how the provisions of section 172 is applicable. Similar was the case with M/s APL India Ltd. The assessee demonstrated that it has filed the bill of lading in proof of the fact that M/s APL India Ltd. as well as M/s Schenkar India Pvt. Ltd. are agents of foreign shipping companies. In view of these, the disallowance in question of Rs.1,92,904/- is deleted by following the decision of the Chandigarh Bench of the ITAT in the case of ITO vs. Bhogal Exports, Ludhiana in AY 2008-09.

3.

In the result, the appeal of the assessee is allowed.

The order pronounced in the open court on 31.08.2016.

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