2017 (4) TMI 569

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.... same order of the CIT(A), we dispose of both the appeal and the Cross Objection by this consolidated order for the sake of convenience. 2. The sole ground of appeal raised by the revenue is against the action of the Ld. CIT(A) in deleting the addition to the tune of Rs. 45,74,228/- made by the AO u/s. 40(a)(ia) of the Income-tax Act, 1961 (hereinafter referred to as the "Act"). 3. Brief facts are that during the year the assessee got transport contract from M/s. Bihar State Food & Civil Supplies Corporation Ltd., Bihar. According to the AO, the TDS was required to be deducted on the payment of Rs. 45,74,228/- made to the transporters. According to the AO, since the assessee has not deducted tax at source on the said amount, he disall....

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....ch were mostly less than Rs. 1300/- on any one occasion and there was no reason to doubt the genuineness of the payments. In the light of the aforesaid factual background, we do not find any infirmity in the order passed by the Ld. CIT(A) in allowing the claim of the assessee since the disallowance could not have been made u/s. 40(a)(ia) of the Act invoking sec. 194C of the Act as has been done by the AO. However, before us it was pleaded by Ld. DR that the ground of appeal says about violation of section 194H of the Act and not u/s. 194C of the Act. However, we do not agree with the said contention of the department because a perusal of the assessment order page 1 itself shows that the AO has taken note of the fact that the assessee has co....

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....see has failed to deduct tax on payment of Rs. 45,74,228/- as transportation charges and commission u/s. 194C of the Act , the said sum of Rs. 45,74,228/- is, therefore, disallowed u/s. 40(a)(ia) of the Act." From the perusal of the above clear finding rendered by the AO it emerges that assessee during the original assessment which was concluded on 13.05.2008 has made a claim of deduction that the amount of Rs. 45,74,228/- has been given to truck owners about 300 in numbers and details of it were mentioned in more than 110 pages in respect to the amount of 'freight paid' and just because word commission has also been added in the 3CD report along with the hiring charges to the transporters cannot be the ground on which the department can tu....