TaxTMI 
TaxTMI 
2014 (8) TMI 803
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....roceedings and therefore, the assessee was not required to deduct TDS in respect of the transport charges of Rs. 28,05,995/- u/s. 194C and accordingly, the disallowance made, u/s 40(a)(ia) should have been deleted. 4. The learned CIT(A) ought to have appreciated that the assessee had duly complied with the provisions of Section 104C and hence, the assessee was not required to deduct TDS on the transport charges of Rs. 28,05,995/- and accordingly, the disallowance made should have been deleted." 2.1 Facts of the case, in brief, are that the assessee is an individual and is engaged in the business of Transport contractor/Transporter. He filed his return of income on 19-04-2012 declaring total income at Rs. 13,53,520/-. During the course of assessment proceedings the Assessing Officer noted from the details furnished by the assessee that the assessee has received transport charges of Rs. 3,41,32,614/- besides hiring charges and unloading charges. The assessee had paid transport charges of Rs. 2,65,14,217/-. Since the assessee has not deducted TDS he asked the assessee to explain why provisions of section 40(a)(ia) should not be invoked. It was explained by the assessee that the ....
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....hat since the forms were not submitted properly, the assessee was liable to make TDS from payment and having failed to do so, the amount of this payment is disallowable under section 40(a)(ia). Out of the list furnished by the assessee, the amount involved in defective cases was Rs. 28,05,995/- which was disallowed by the assessing officer. 3. Before the CIT(A) it was submitted that the disallowances made u/s.40(a)(ia) was without properly appreciating the facts. It was argued that the provisions are not at all applicable since the assessee has obtained a declaration in Form 15I from truck company and that mistakes in PAN or spelling of deductee were mainly technical in nature. 3.1 However, the Ld.CIT(A) was not satisfied with the explanation given by the assessee and upheld the disallowance made by the Assessing Officer. He noted that the assessee did not comply with the provisions of section 194C by making TDS from the payments. The Assessing Officer has established that the information submitted to CIT-II contain incorrect PAN Nos. In other cases and as per section 206AA(6) where the PAN Nos. is incorrect, it is deemed that PAN has not been furnished. He, therefore, held t....
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....t in a number of cases of transporters/truck owners, the PAN Nos. were not correct or the PAN Numbers had been given without proper verification and in a casual manner by furnishing either wrong PAN numbers or wrong names. We find on being questioned by the Assessing Officer the assessee furnished the list of truck owners along with PAN Numbers and other details. We find the Assessing Officer categorised such numbers into six categories. He allowed the claim of the assessee for non deduction of TDS in case of persons where wrong spelling of names were mentioned due to clerical mistakes, wrong spelling of PAN mentioned due to clerical mistakes and change in name due to marriage. He, however, did not accept the list given by the assessee in the case of persons where PAN numbers of transport operators were subsequently rectified but originally not given correctly. Similarly, he disallowed the claim of the assessee where wrong PAN Numbers were given originally and in one case, i.e. in the case of Shri Ashish Sham Talathi he noted that neither the PAN nor the name was included in the list submitted. 6.1 It is the submission of the Ld. Counsel for the assessee that only in one case, i....
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.... assessee to give a comparative chart of transportation charges paid to third parties, vis-a-vis to the related persons. The assessee filed the details of transportation charges paid to others, vis-a-vis the related parties. From the details furnished by the assessee, the Assessing Officer noted that the assessee has paid transportation charges of Rs. 1,93,49,440/- to outside parties and Rs. 75,49,633/- to parties covered u/s.40A(2)(b) of the I.T. Act. The payment of road transportation charges to related parties was to the extent of 28.12% and the same were paid to Dilip S. Bashte (brother of the assessee) Shri Prasad Bashte and Kunaal Bashte (Sons of the assessee) and Mrs. Madhura Bashte (Wife of the assessee). To ascertain the reasonableness of the transportation charges paid to the related parties, the Assessing Officer asked the assessee to give the details of rate paid to the third parties, vis-a-vis to persons covered u/s.40A(2)(b) of the I.T. Act. In absence of any details given by the assessee, the Assessing Officer held that this is nothing but bifurcation of segregation of income in different hands to avoid proper payment of tax. He further noted that none of the sons of....