Tribunal allows assessee's appeals, dismisses Revenue's appeals

The Tribunal allowed the assessee's appeals for both assessment years, dismissing the Revenue's appeals. The disallowance under section 40(a)(ia) was deleted as the payments were not claimed as expenditure. The issue of Bisi payment was remanded for further examination by the AO. The appeals of the assessee were treated as allowed for statistical purposes, while those of the Revenue were dismissed.

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Issues Involved:
1. Disallowance under section 40(a)(ia) for non-deduction of tax at source on payments to doctors and pathology laboratory.
2. Addition of Bisi payment under section 69C of the Act.

Issue 1: Disallowance under section 40(a)(ia) for non-deduction of tax at source on payments to doctors and pathology laboratory:

The case involved appeals by the assessee and the Revenue regarding disallowance of &8377; 11,95,0669 under section 40(a)(ia) for non-deduction of tax at source on payments made by the hospital to doctors and pathology laboratory. The Assessing Officer disallowed the entire payment, invoking section 40(a)(ia) due to the absence of TDS deduction. The CIT(A) upheld the disallowance for inpatients but not for outpatients. The Tribunal analyzed whether the hospital obtained services from doctors or acted as an agent for collecting fees. It noted that the hospital did not claim the payments as expenditure in its profit and loss account, leading to the deletion of the disallowance under section 40(a)(ia).

Issue 2: Addition of Bisi payment under section 69C of the Act:

The assessee had invested &8377; 8 lakh in Bisi payment, not claimed as expenses, stating it was made from declared income during a survey. The CIT(A) rejected this claim, observing the lack of evidence showing the Bisi payments as investments from the declared income. The Tribunal remanded the issue to the AO for re-examination, directing a proper opportunity for the assessee to prove the source of Bisi payments. The Tribunal allowed the appeal partly for statistical purposes.

In conclusion, the Tribunal allowed the assessee's appeals for both assessment years, dismissing the Revenue's appeals. The disallowance under section 40(a)(ia) was deleted as the payments were not claimed as expenditure. The issue of Bisi payment was remanded for further examination by the AO. The appeals of the assessee were treated as allowed for statistical purposes, while those of the Revenue were dismissed.

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