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The Tax PublishersITA No. 1099/Del/2017
2021 TaxPub(DT) 0515 (Del-Trib)INCOME TAX ACT, 1961
Section 194C
Where AO made disallowance of advertisement expenses on the ground that no tax at source had been deducted on the same; however, the payment made on account of advertisement expenses being less than Rs. 20,000, the provisions of section 194C would not be attracted in such case.
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Tax deduction at source - Applicability of section 194C - Payment being less than Rs. 20,000 -
Assessee-company claimed expenditure of Rs. 42,340 on account of 'Advertisement & Publicity expenses'. AO disallowed the said expenditure on the ground that no tax at source had been deducted on the same. Further, CIT(A) confirmed such disallowance. Held: It was found that the amount of Rs. 42,340 consisted of an amount of Rs. 17,340 paid on account of advertisement and since the amount was less than Rs. 20,000, the provisions of section 194C were not attracted. Further, out of Rs. 42,340, an amount of Rs. 25,000 had been paid on account of car expenses and there was no contract between the assessee and recipient. Therefore, the assessee being a payer was not liable to deduct tax at source under section 194C. Hence, the disallowance made by the AO was directed to be deleted.
REFERRED :
FAVOUR : In assessee's favour.
A.Y. :
INCOME TAX ACT, 1961
Section 41(1)
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