TaxTMI 
TaxTMI 
2016 (9) TMI 589
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....sessing Officer. 3. The short facts of the case are that the assessee is a private limited company engaged in the business of developing township at Indore under the name of 'Silver Spring'. The return of income was filed at nil income. The Assessing Officer completed the assessment by making disallowance of Rs. 154 lacs for short deduction of TDS holding that advertisement expenses paid to dainik bhaskar was a professional payment. The assessee made payment of Rs. 172 lacs and TDS was made at 1% as per section 194C of the Act. The Assessing Officer observed that the entire expenses claimed on account of advertisement are not allowable this year as assessee company accounted for sales at Rs. 15.28 crores only. The Assessing Officer was t....
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....has retrospective effect from Ist April, 2005". However, the learned counsel for the assessee submitted the following written submissions :- " During the course of assessment under section 143(3) the ld assessing officer has disallowed advertisement expenses on two norms. First, on the ground that TDS was deducted on payment to Dainik Bhaskar @1% applicable for advertisement expenses whereas it was required to be deducted at higher rate, being professional fees. Second ground for disallowance was that the advertisement expenses where more than the income recognised during the year. In the first appeal the ld CIT appeals deleted the addition rightly holding that the expenses where advertisement in nature. However, the ld CIT (appeals) did....
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....ertiser Danik Bhaskar. The advertiser had published advertisement in the newspapers on different rates which resulted into substantial response in the shape of booking in the asssesss's project. Therefore, it was clearly a case of advertisement wherein there was no aota of professional services. As regards second issue that the advertisement expenses are more than the receipt shown in the P& l: it is to submit that income has been recognised in accordance with AS9 of Institute of Chartered Accountant. However the business gained is sofaras much more than the income recognised, which is in the shape of bookings which yielded income in the subsequent years. Hence, ld AO was not justified in making disallowance. Ld Commissioner of Income Tax (....
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....difference of opinion as to the taxability of the item or the nature of the payments falling under various TDS provisions the assessee in default u/s 201 of the act and no disallowance can be made by invoking the provisions of section 40(a)(ia) of the act. 2. CIT vs S.K. Tekriwal, 361 ITR 432(Calcutta High Court) Business Expenditure- Disallowance- Payments Subject To Deducion Of Tax At Source- Payments To Sub-Contractor- Assessee Deducting Tax At Source Under Wrong Provision Resulting In Short Deduction Of Tax- No Disallowance- Can Be Made Applying Section 40(A)(Ia)- Income Tax Act, 1961 3. ACIT Vs PANKAJ BHARGAVA,( 34 CCH 0035, Delhi Tribunal) Business expenditure- Allowability - AO held that assessee has deducted tax at sourc....
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....re in nature of fees for professional services and accordingly provisions of s. 194J would attract and since assessee has not deducted the tax, disallowed amounts claimed of Rs. 26,75,535/- u/s. 40(a)(ia)- Commissioner of Income Tax (Appeals) deleted addition made by AO-Held, assessee has employed about 18 consultants with whom it entered into agreements for a period of two years-They were paid fixed amounts without any share in the profit-These consultants are prohibited from taking any private assignments and worked full time with the assessee firm-There was deduction of tax u/s 192 and in their individual assessments these payments were accepted as salary payments-Entire amount paid for 18 consultants is only an amount of Rs. 26,75,535/-....