Case Law Details
Scrabble Entertainment Ltd Vs ACIT (ITAT Mumbai)
Once there is compliance to TDS provisions, even if there is short deduction of TDS or TDS has been deducted under different sections, there is no scope for the AO to disallow expenditure u/s 40(a)(ia) of the Act as the provisions u/s 40(a)(ia) is applicable only when there is no TDS deduction. This legal proposition is supported by the decision of Hon’ble Calcutta High Court in the case of CIT vs SK Tekriwal (supra) wherein it was held that if there is lesser deduction of TDS due to any difference of opinion, no disallowance can be made u/s 40(a)(ia) of the Act. If there is short deduction, the revenue is free to proceed to pass an order u/s 201 of the Act, but no disallowance can be made u/s 40(a)(ia) of the Act.
FULL TEXT OF THE ITAT JUDGMENT
These cross appeals filed by the assessee as well as revenue are directed against the order of the CIT(A)-4, Mumbai dated 11-01-2016 and they pertain to assessment year 2011-12. Since both the appeals pertain to the same assessee, for the sake of convenience, they were heard together and are disposed of by this common order.
2. The brief facts of the case are that the assessee company engaged in the business of sales of DFL projectors and related accessories of deployment of digital cinema. The assessee has filed its return of income for the assessment year 2011-12 on 27-09-2011 declaring total income at Nil. The assessment was completed u/s 143(3) on 27-03- 2014 determining the total income at Nil after setting off of brought forward losses by making addition towards unexplained cash credits towards share capital and share premium, expenditure incurred on UAE branch, disallowance of interest on inter-corporate loans, addition towards cessation of liability u/s 41(1), towards unproved sundry creditors, disallowance of expenditure for failure to deduct TDS / short deduction of TDS u/s 194C, addition towards AIR mismatch and disallowance of amortization of subsidized cost. The AO also recomputed book profit u/s 115JB by making adjustments towards addition made on account of disallowance of amortization of subsidized
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