Addition for non TDS deduction not justified if form 15G been obtained

By CA Sandeep Kanoi Income Tax Judiciary November 10, 2017

TaxGuru Citation: 2017 taxguru.in 1129
Case Name: Sri Nidamanuri Nageswara Rao Korukonda Vs. ITO (ITAT Visakhapatnam)
Appeal Number: Only available for paid members
Date of Judgement/Order: Only available for paid members
Related Assessment Year: 2010-11
Courts: All ITAT, ITAT Visakhapatnam

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Sri Nidamanuri Nageswara Rao Korukonda Vs. ITO (ITAT Visakhapatnam)

The assessee has made the payment of Rs. 41,000/- as interest to the deductee Smt. N. Sarvari who happened to be the wife of the assessee. Though the amount was credited to her account in the books of accounts of the assessee, the payment was not made to her and before making the payment and filing the return of income, the assessee had obtained the form 15G and forwarded to the Ld. CIT. Since the recipient was not having taxable income, obtaining form 15G before making the payment would be sufficient compliance and hence, we hold that the addition u/s 40(a)(ia) of the Act does not attract.

Full Text of the ITAT Order is as follows:-

This appeal filed by the assessee is directed against order of the Commissioner of Income Tax (Appeals) {CIT(A)}, Rajahmundry vide ITA No. 101/0004/13-14/ITO W-3 RJY/2014-15 dated 30.1.2015 for the assessment year 2010-11.

2. The assessee has raised following grounds of appeal:

1. The order of the learned Commissioner of Income Tax (Appeals) is contrary to the facts and also the law applicable to the facts of the case.

2. The learned Commissioner of Income Tax (Appeals) is not justified in sustaining the addition of Rs. 41,000 made by the assessing officer u/s 40(a) (ia) of the Act.

3. The learned Commissioner of Income Tax (Appeals) is not justified in granting relief only for a sum of Rs.1,15,000 out of addition of Rs. 16,69,407 made by the assessing officer u/s 40(A) (3) of the Act.

4. The learned Commissioner of Income Tax (Appeals) is not justified in sustaining the addition of Rs. 3,00,097 made by the assessing officer towards unexplained credits in the bank account without appreciating the contention that the bank account belonged to HUF of the appellant.

5. The learned Commissioner of Income Tax (Appeals) ought to have held that the assessing officer is not justified in apportionment of the cost of construction between A.Ys. 2009-2010 to 2010-2011 without appreciating the contention that the alleged unexplained investment, if any, took place only during A.Ys. 2010-2011 and 2011-2012.

6. The learned Commissioner of Income Tax (Appeals) ought to have decided the ground raised by the appellant with regard to excessive amount of cost of construction determined by the DVO and adopted by the assessing officer for arriving at the unexplained investment.

3. Ground Nos. 1 & 7 are general in nature, which do not require specific adjudication.