TDS not applicable on Reimbursement to Sister Concern

Delhi HC remanded the matter to AO to verify that  claim towards the payment of Rs.3,19,66,460/- does not include any income component and if it constitutes reimbursement, the question of application of Section 40(a)(ia) would not arise. It further held that  Expense should be disallowed for non-deduction of TDS if corresponding income is brought to tax in the hands of the recipient. Relevant Extract of the Judgment 2. The assessee had, for the Assessment Year (A.Y.) 2008-09, inter alia shown expenditure to the tune of about Rs.3,19,66,460/- which was paid to M/s. Aakriti Creation Pvt. Ltd. ...