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Income Tax : Details of Form 13 & section 194C(6) of Income Tax Act 1961. Learn importance of these for transporters & how to avoid excess TDS ...
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Income Tax : Section 40(a)(ia) is amended via Finance (No. 2) Act, 2014 to restrict the amount of disallowance for non-deduction of tax to 30% ...
Income Tax : The existing provisions of section 40(a)(ia) of Income-tax Act provide for the disallowance of expenditure like interest, commissi...
Income Tax : Learn how ITAT Bangalore ruled in favor of Herbalife India on technical service payments, clarifying FTS under India-USA DTAA. Det...
Income Tax : ITAT Mumbai invalidates income tax assessment for a merged entity, emphasizing the legal principle against actions on non-existent...
Income Tax : Assessing Officer has nowhere determined as to how Section 194C is applicable on payments made by assessee. Unless a charge is bei...
Income Tax : Issuance Of Letters Of Comfort/Support will Construe As International Transaction U/s 92B considering corporate guarantee issued b...
Income Tax : Expenditure incurred by assessee should be disallowed to the extent that expenditure which had been incurred for evaluation of bus...
Income Tax : Circular No. 3/2015 Section 40(a)(i) of the Act stipulates that in computing the income chargeable under the head "Profits or gain...
Income Tax : Sub: Deduction of tax at source under Section 195 read with Sections 201 of the Income-tax Act, 1961 relating to payment made to a...
Income Tax : Circular No. 10/DV/2013-Income Tax It has been brought to the notice of the Board that there are conflicting interpretations by j...
Provision of section 40(a)(ia) of the Act are applicable not only to the amounts which is shown as payable on the date of balance sheet but it is applicable to such expenditure which becomes payable at any time during the relevant previous year and was actually paid within the previous year.
Where assessee paid amount to deliveryman to deliver the newspapers and delivery persons were nothing but casually engaged labourers and they have no other work to perform and assessee had wrongly debited the amount as commission in its books, AO was not justified in making dis allowance under section 40(a)(ia) for no TDS by only giving weight age to nomenclature and without seeing the real purpose for payment.
Provisions of section 40(a)(ia) shall, so far as they may be, apply in computing income chargeable under the head income from other sources as they apply in computing income chargeable under the head Profit and gains of business or Profession.
CA Sharad Jain Introduction: The section 40(a)(ia) of the Income Tax Act (“Act”) was brought on the statute by the Finance (No. 2) Act, 2004, with effect from 1-4-2005 i.e., from Assessment Year 2005-06 with the aim to ensure better compliances of TDS provisions. Since inception, these provisions are being felt by the tax assesses […]
Sections 194C(6) and Section 194C(7) are independent of each other, and cannot be read together to attract disallowance u/s 40(a)(ia) read with Section 194C of the Act; and If the assessee complies with the provisions of Section 194C(6), no disallowance u/s 40(a)(ia) of the Act is permissible, even there is violation of the provisions of Section 194C(7) of the Act.
In view of the second proviso to section 40(a)(ia) read with proviso to section 201(1) of the Income Tax Act no disallowance of expense u/s 40(a)(ia) can be made unless the assessee has been treated as assessee in default under S. 201(1) of the Act for its failure to deduct tax at source from the payment made on account of interest.
ITAT Mumbai that payment made by M/s. BSR & Co to KPMG group professional entities based in Various Countries outside India for Services in relation to taxation matters, independent personal services, assistance in audit, taxation, information technology services, conducing background checks, etc.
Section 40 (a) (i), in providing for disallowance of a payment made to a non-resident if TDS is not deducted, is no doubt meant to be a deterrent in order to compel the resident payer to deduct TDS while making the payment.
Where assessee was earning booking charges for facilitating transport of goods and was merely a conduit in passing the freight to the truck owners, who were actually plying trucks, disallowance under section 40(a)(ia) was not justified because freight payment was not even claimed by assessee as an expense in its profit and loss account.
Bombay High Court held In the case of M/s. Sesa Resources Ltd. vs. DCIT/Union of India that in the Judgment of the Division Bench in the case of Gujarat Reclaim & Rubber Products Ltd. Income Tax Appeal No.169/2014 dated 08.12.2015, it was held that before effecting deduction at source one of the aspects to be examined is whether such income is taxable in terms of the Income Tax Act.
