ITAT deletes Section 40(a)(ia) disallowance on provision for expenses

IDBI Bank Ltd. Vs DCIT (ITAT Mumbai) During the Assessment Year (AY) 2009-10, the taxpayer made provision for expenses under the head ‘repairs and maintenance’ amounting to Rs. 6 million on which tax was not deducted at source. The taxpayer also made provision for ‘operation and maintenance charges’ amounting to Rs.7 million on which tax was not deducted at source. The Assessing Officer observed that these expenditures were a contingent liability and the same is not allowed under Section 37(1) of the Act. Further, no tax was deducted at the time of credit of expenses and therefore, the...