Dis-allowance for Short Deduction of TDS

Dear Member,

 
The following important judgement is attached herewith for your information

DCIT vs. M/s. S. K. Tekriwal (ITAT Kolkata)

No s. 40(a)(ia) disallowance for short-deduction TDS default

The assessee paid Rs. 3.37 crores as “machine hire charges” on which it deducted TDS u/s 194C at 1%. The AO held that the payment was “rent” and TDS ought to have been deducted at 10% u/s 194-I. He disallowed the expenditure u/s 40(a)(ia). This was reversed by the CIT (A). On appeal by the department, HELD dismissing the appeal:

CA. Chiranjiv SodhiB.Com, FCA, DISA(ICA)