2013 (4) TMI 417

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....facts as has been brought on record are that the assessee- Company filed its return of income on 19.9.2009 declaring total income of Rs. 1,34,78,990. The same was processed u/s.143(1) on 18.3.2011. Subsequently the case was reopened u/s.147 and accordingly notice u/s.148 was issued on 17.3.2011. On verification audited-accounts of the assessee it was observed that the assessee company has paid Rs. 16,00,000 towards directors salary. This being a payment for professional fees attracts the provisions of TDS under section 194J. However no TDS had been made on such payments. Also during the course of assessment proceedings the assessee has not furnished any explanation for non-deduction of tax at source. The Assessing Officer, therefore, disall....

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....withholding of tax on the managerial remuneration was brought into statute w.e.f. 1.7.2012. Therefore the impugned Assessment Year there was no clause to explain the managerial remuneration insofar as the Director of the Company holds fiduciary relationship which relationship can neither be termed as employee employer relationship nor can be considered as rendering professional or technical services as envisaged in Section 194J for the purpose of disallowance of remuneration to the Directors claimed in the P & L account under the deeming provisions of Section 40(a)(ia). In fact the clarification by this enactment w.e.f. 1.7.2012 clarifies the position insofar as "any remuneration or fees or commission by whatsoever name called" clearly indi....