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of <h1>Court affirms CIT (A) and Tribunal decisions in favor of assessee on disallowance issues under Income Tax Act</h1> The Court upheld the decisions of the CIT (A) and the Tribunal, ruling in favor of the assessee on all issues. Disallowance of expenses under Section ... Disallowance u/s 40(a)(ia) - non deduction of tds - HELD THAT:- Considering the material on record, the learned CIT (A) as well as the Tribunal have observed that infact the payments were reimbursement of lease rent charges paid to lessor viz. SREI Infrastructure Ltd. by Sanghi Industries Ltd. (SIL) and the TDS was deducted and paid by the concerned assessee - SIL. Considering the above, it cannot be said that the learned CIT (A) as well as the learned Tribunal committed any error in deleting such dis-allowance. Dis-allowance on account of lease rental payments - dis-allowance u/s 37(1) on account of operating and maintenance charges and repairs and maintenance charges u/s 40(a)(ia) on the payments on which TDS was not deducted by the assessee - HELD THAT: It is required to be noted that in the year under consideration, no TDS was deducted as the same was contingent liability and the bills were not issued which were issued subsequently and on that the TDS was deducted as and when the final bills were received. Considering the above, no error has been committed by the learned CIT (A) as well as the learned Tribunal in deleting the dis-allowance. We are in complete agreement with the view taken by the learned Tribunal as well as the learned CIT (A). Issues:1. Disallowance of expenses under Section 40(a)(ia) of the Income Tax Act.2. Disallowance of lease rental payments and operating & maintenance charges under Sections 37(1) and 40(a)(ia) of the Act.3. Reimbursement of payments without deducting TDS.Analysis:1. The first issue pertains to the disallowance of expenses under Section 40(a)(ia) of the Income Tax Act. The Assessing Officer disallowed expenses due to non-deduction of TDS by the assessee. However, the CIT (A) and the Tribunal observed that the payments were actually reimbursements of lease rent charges with TDS deducted and paid by the assessee. Therefore, the disallowance was deleted, and it was concluded that no error was committed by the authorities in this regard.2. The second issue involves the disallowance of lease rental payments, operating & maintenance charges, and repairs & maintenance charges under Sections 37(1) and 40(a)(ia) of the Act. It was noted that in the relevant year, no TDS was deducted initially due to the contingent nature of the liability and delayed billing. TDS was deducted upon receipt of final bills. The CIT (A) and the Tribunal upheld the deletion of disallowance, finding no fault in the decision. The Court agreed with this view, leading to the dismissal of the appeal.3. The third issue is related to payments reimbursed by the assessee without deducting TDS. This issue was deemed consequential to the second issue, which was decided in favor of the assessee. As a result, it was held that no substantial question of law arose in the case, leading to the dismissal of the appeal by the Court.In conclusion, the Court upheld the decisions of the CIT (A) and the Tribunal regarding the deletion of disallowances, finding no errors in the treatment of expenses and TDS deductions. The appeal was dismissed based on the lack of substantial legal questions arising from the case.
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