No liability on assessee to deduct merely based on provisions

AT& T Communication Services India Pvt Ltd Vs DCIT (ITAT Delhi)

The Hon^‟ble Mumbai Tribunal in case of Pfizer Ltd (ITA No. 1667/MUM/2010) also held that, since payees are not identifiable at the time of making provisions, tax withholding provisions are not attracted.

Hon^‟ble Bangalore Tribunal in case of DCIT v. Telco Construction Equipment Co. Ltd (ITA No. 478/Bang/2012), wherein the Hon^‟ble Tribunal has held that year-end provisions did not attract tax withholding provisions as the taxpayer credited the amount of commission payable to provision account and not to respective agents account.

ITAT held that no disallowance can be made for non-deduction of tax at source when the year and provisioning made by the assessee are reversed on the 1^st day of the subsequent year.

FULL TEXT OF THE ITAT JUDGEMENT

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