2015 (12) TMI 1520

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.... CIT(A) was not justified in allowing appeal on the basis of a non speaking order of Hon'ble Supreme Court rejecting SLP in the case of Victor Shipping Services (P) Ltd. The CIT(A) failed to appreciate that it has been held in various decisions of the apex court itself including the decision in the case of Kunhayammed & Others Vs State of Kerala (245 ITR 360) that a decision not assigning reasons for dismissing the SLP would neither attract the doctrine of merger nor would it be a declaration of law by the Supreme Court under article 141 of constitution. 2. On the facts and in the circumstances of the case and in law the Ld. CIT (Appeals) was not correct in holding that section 40(a)(ia) covers only the amounts which are payabl....

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....set aside the matter to the AO. In compliance of the direction again the impugned assessment was finalised. However, the disallowance was made u/s 40(a)(ia) at Rs. 54,58,831/-. Again an appeal was filed before the first appellate authority who has decided the issue in assessee's favour in the following manner : "6.2 The above decision of the Hon'ble Allahabad High Court in the case of CIT vs. Vector Shipp-ing Services (P) Ltd. has been upheld by the Hon'ble SC vide its order dated 02-07-2014 wherein it has been held that the disallowance u/s 40(a)(ia) would apply only to the amounts which are "payable" as on 31st of March and not to amounts already "paid" during the year. The Department had gone in appeal before the Hon&#39....

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.... as under: "9. We do not find that the revenue can take any benefit from the observations made by the Special Bench of the Tribunal in the case of Merilyn Shipping and Transport Ltd. (136 ITO 23) (SB) quoted a's above to the effect Section 40 (a) (ia) was introduced in the Act by the Finance Act, 2004 with I effect from 1.4.2005 with a view to augment the revenue through the mechanism of tax deduction at source. This provision was brought on statute to disallow the claim of even genuine and admissible expenses of the assessee under the head 'Income from Business and Profession' in case the assessee does not deduct TOS on such expenses. The default in deduction of TOS would result in disallowance of expenditure on which such TOS ....