ITAT rules commercial discounts to spare parts dealers not subject to TDS under section 40(a)(ia)

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....ITAT allowed the assessee's appeal regarding disallowance under section 40(a)(ia) for target, consistency, and cash discounts provided to spare parts dealers. The tribunal distinguished between principal-to-principal dealership arrangements and agency relationships, holding that discounts given under dealership agreements constitute genuine commercial discounts rather than commission payments requiring TDS deduction. Following the Supreme Court precedent in CIT v. Ahmadabad Stamp Vendors Association, the tribunal found that bulk purchase discounts are sales transaction discounts, not subject to section 194H. The revenue authorities failed to investigate dealer agreements or establish any agency relationship. Without evidence that dealers ac.........