TaxTMI 
TaxTMI 
TaxTMI 
2017 (1) TMI 943
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....ears. First we take up the assessee's appeal for A.Y. 2008-09. ITA No.826/M/2013 for A.Y. 2008-09 2. The assessee in this appeal has taken as many as of six grounds of appeal. At the outset, the Ld. A.R. of the assessee has stated that ground No.3, 5 & 6 are not pressed. Ground Nos.3, 5 & 6 are therefore dismissed accordingly. 3. Now we have remained with ground Nos.1, 2 & 4. Vide ground Nos.1 & 2, the assessee has contested the action of the Commissioner of Income Tax (Appeals) [hereinafter referred to as the CIT(A)] in confirming the disallowance of Rs. 11950669/- under section 40(a)(ia) on account of non deduction of tax at source on the payments made by the assessee hospital to the doctors and pathology laboratory in relation to inp....
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....nts in the form of registration fees, bed charges and other hospital charges etc. The facilities for medical consultation, surgery and other professional services were provided by the doctors to the patients directly; only the premises of the hospital was used for the said purpose. Thus, the collection made from patients on behalf of doctors or pathology were not recorded in the books of account of the assessee. It was further pleaded that since no expenditure was claimed in P & L account in respect of the payments made to the doctors and pathology laboratory, hence there was no question of disallowance of expenditure under section 40(a)(ia) in respect of the above stated payments. The AO however observed that there was no written agreement....
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....st. In this process the hospital had availed the professional services of the doctors and had been paying the fees for such professional services to the doctors. He observed that such payment made by the hospital to the doctors was the fees for professional services done by the doctors to the hospital. He accordingly upheld the disallowance made by the AO under section 40(a)(ia) of the Act for non deduction of TDS in relation to the payment made by the hospital to the doctors and pathology laboratory in respect of inpatients. Being aggrieved by the above order of the Ld. CIT(A), the assessee has come in appeal before us. 7. The Revenue has also come in appeal agitating the relief granted by the Ld. CIT(A) on payments remitted to doctors in....
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....d to the patients by the hospital, in that event any payment collected by the hospital from the patients will be the income of the hospital and any payment made by the hospital to the doctors or the lab will be the expenditure at the hands of the hospital at which the hospital will be liable to deduct TDS. Admittedly, neither the AO nor the Ld. CIT(A) have added the amount collected by the hospital from the patients on behalf of the doctors as income of the hospital. What has been disallowed is the expenditure; that too on account of non deduction of TDS as per the provisions of section 194J of the Act. The disallowance has been made accordingly under section 40(a)(ia) of the Act. Admittedly, the assessee hospital has not debited the said e....
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....not agree with the appellant. I have gone through the revised P & L account and balance sheet filed by the appellant while filing the return of income consequent to the survey conducted u/s 133A of the Income-tax Act. The Bisi payments are not reflected in the capital accounts as separate drawings and it is not shown as an investment in the balance sheet. So whatever the amount declared by the appellant in the revised return is already mereflecting asassets disclosed (which doesn't contain Bisi payments) in the revised balance sheet. In view of this, it cannot be considered that the additional income offered of Rs. 27,03,620/- is used for Bisi payments. The appellant's contentions are not accepted. Addition is upheld." 1. We have h....