AJMERA ENTERPRISES,MUMBAI vs. ACIT RG 12(1), MUMBAI

PDF · subscribers
ITA 8893/MUM/2010Status: DisposedITAT Mumbai23 March 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 when payment is made to a clearing agent, the assessee is not under an obligation to deduct TDS. Therefore, the disallowance made by the CIT(A) was incorrect.

What were the facts?

The assessee reimbursed payments to a clearing agent, who was then obligated to pay the parties and deduct TDS. The assessee argued they were not obligated to deduct TDS as the clearing agent handled the subsequent payments.

What were the issues?

Whether the assessee was obligated to deduct TDS when payments were made to a clearing agent who was responsible for further payments and TDS deduction.

Which sections of the Income-tax Act were involved?

Section 40(a)(ia)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “A” BENCH, MUMBAI

Before: S/SHRI B.R.BASKARAN & AMARJIT SINGH

For Appellant: Shri Prakash Jotwani
Hearing: 14.01.2016Pronounced: 23.03.2016

PER AMARJIT SINGH, JM:

The assessee has filed the present appeal against the order dated 16.09.2010 passed by the Commissioner of Income Tax (Appeals)-23, Mumbai [hereinafter referred to as the “CIT(A)”] relevant to the assessment year 2007-08. 2. The sole point which has been raised before us is that the learned CIT(A) has wrongly confirmed the disallowance of Rs.40,41,790/- u/s. 40(a)(ia). The contention of the assessee is that he did not make any Assessment Year: 2007-08

payment directly to any party but he reimbursed the payment to clearing agent and clearing agent was under obligation to make the payment further to the parties as the parties were known to him and contracted with him hence TDS has not been deducted whereas clearing agent on payment to the parties was under obligation to deduct TDS therefore, the assessee was not under obligation to deduct the TDS and placed reliance upon the Income Tax Appellate Tribunal Kolkata Bench titled as Income Tax Officer Vs. Jaypee Alloy & Casting Pvt. Ltd. in ITA No.1656/Kol/2010 for A.Y.2006-07 decided on 09.04.2015. However the learned representative of the department strongly relied upon the finding of the learned CIT(A). On the above said facts and circumstances matter of controversy has already been decided by the Income Tax Appellate Tribunal Kolkata Bench titled as Income Tax Officer Vs. Jaypee Alloy & Casting Pvt. Ltd. in ITA No.1656/Kol/2010 for A.Y.2006-07 decided on 09.04.2015. Wherein it has been decided that when the payment was made to the clearing agent then in the said circumstances the assessee is not under obligation to deduct the TDS. Therefore in view of the said law we are of the view that the learned CIT(A) has wrongly confirmed the disallowance of Rs.40,41,790/- u/s. 40(a)(ia) of the Act and the said addition is hereby ordered to be deleted.

3.

In result the appeal of the Assessee is hereby Allowed accordingly.

2 Assessment Year: 2007-08

Order pronounced in the open court on 23rd March, 2016 (AMARJIT SINGH) (B.R.BASKARAN) लेखा सद"य / ACCOUNTANT MEMBER "या"यक सद"य/JUDICIAL MEMBER मुंबई Mumbai; "दनांक Dated : 23rd March, 2016 MP MP MP MP

आदेश क" ""त"ल"प अ"े"षत/Copy of the Order forwarded to : 1. अपीलाथ" / The Appellant

2.

""यथ" / The Respondent. 3. आयकर आयु"त(अपील) / The CIT(A)- 4. आयकर आयु"त / CIT

5.

"वभागीय ""त"न"ध, आयकर अपील"य अ"धकरण, मुंबई / DR, ITAT, Mumbai 6. गाड" फाईल / Guard file. आदेशानुसार/ BY ORDER, स"या"पत ""त //// उप/सहायक पंजीकार (Dy./Asstt.

More judgments on Section 40(a)(ia)

All 7,300 judgments and leading authorities on Section 40(a)(ia) →

Latest GST High Court judgments

Search GST case law →