Amended provisions of S.194I related to TDS for the purpose of S. 40(a)(ia) applicable from AY 2007-08

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INCOME TAX APPELLATE TRIBUNAL, DELHI

ITA No.774/Del/2011 - Assessment Year: 2006-07

Assistant Commissioner of Income Tax

Vs.

M/s Global One India Pvt.Ltd.

When the CBDT itself has clarified that the amended provisions of Section 194I relating to deduction of tax at source for the purpose of Section 40(a)(ia) would be applicable for AY 2007-08, the Assessing Officer was not justified in making the disallowance. We also find that similar issue came up before the learned CIT (A) in AY 2005-06 wherein he accepted the assessee’s contention. Though in AY 2005-06, the Revenue filed the appeal against the order of CIT (A) on this point, but the ground relating to deletion of disallowance of circuit charges by the CIT (A) was not raised before the ITAT. Thus, the Revenue has accepted the order of the CIT (A) on this point for AY 2005-06. In such circumstances, we do not find any justification for interfering with the order of the learned CIT (A) in the year under consideration wherein he has followed the order of his predecessor for AY 2005-06 which is accepted by the Revenue. In view of the above, we do not find any merit in the appeal of the Revenue.