No TDS Liability on Year-End Provisions Without Identified Payees: ITAT Mumbai

Sapphire Foods India Limited Vs OSD TDS (ITAT Mumbai) Assessee, operating KFC & Pizza Hut restaurants, was treated as an assessee-in-default u/s 201(1) & 201(1A) for not deducting TDS on year-end provisions of ₹5.70 crore towards rent, contractors, professional & technical charges, etc. The AO raised a total demand of ₹64.51 lakh, holding that TDS should have been deducted even on year-end accruals. Assessee argued that: Payees were not identifiable at year-end. 30% of such expenses were disallowed suo motu u/s 40(a)(ia) in the return. TDS was deducted & deposited in the s...