2014 (12) TMI 1328

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....he facts and in the circumstances of the case and in Law, the Ld. CIT(A) erred in deleting the addition ujs.40(a)(ia) of the Act amounting to Rs. 11,89,18,600/-?" 2. "Whether on the facts and in the circumstances of the case and in Law, the Ld, CIT(A) is justified in deleting the addition of Rs. 11,89,18,600/- on the ground that the amount added by the Assessing Officer ujs.40(a){ia) was not claimed as deduction in the Profit & Loss Account when as a matter of fact the Assessing Officer had categorically invoked Section 145 of the Act and had held that the amounts received by the assessee from Insurance companies and deposited in float account has to be recognized as revenue receipt and the outflow as expenses and, this decision of the A....

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....d under the TPA agreement. 3. The assessee challenged the action of Assessing Officer before CIT(A). The CIT(A) deleted the addition on the ground that the payment in question is not for professional services rendered by the assessee but it is acting as pass through between insurer and the insured. 4. We have heard the Ld. DR as well as Ld. AR and considered the relevant material on record. The Ld. Authorized Representative of the assessee has submitted that this issue is covered in favour of the assessee by the decisions of this Tribunal in the case of ACIT Vs. Health India TPA Services P. Ltd. dated 21.2.2014 in ITA no. 6475/Mum/2012 as well as the decision dated 25.7.2014 of this Tribunal in the case of Paramount Health Services (T....

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.... section 201(1A) of the Act are attracted. The issue in the case before us is not regarding the liability under section 201(1) and 201(1A) but the dispute is regarding adition under section 40(a)(ia) for non-deduction of tax at source. The assessee has relied upon a series of decisions in support of its claim and submitted that provisions of section 40(a)(ia) cannot be invoked for non deduction of tax by TPA service provided being a conduit between the insurer and hospital/ the insured. In the case of ACIT vs. M/s. Health India TPA Services P. Ltd. in ITA No.5856/M/11 for assessment year 2008-09 this Tribunal vide its decision dated 22/2/2013 has held in para-5 as under :- "5. We have considered the issue. As seen from the facts placed o....