ITAT directs the Assessing Officer to delete disallowance u/s.40(a)(ia) of the Income Tax Act against Tata Sky

ITAT directs the Assessing Officer to delete disallowance u/s.40(a)(ia) of the Income Tax Act against Tata Sky

The Income Tax Appellate Tribunal (ITAT) granted relief to the M/s Tata Sky wherein it directed the Assessing Officer (AO) to delete disallowance under Section 40(a)(ia) of the Income Tax Act, 1961, (IT Act)

M/s. Tata Sky Limited (assessee) sought to recall the order of the ITAT based on a particular issue about upholding the disallowance made under Section 40(a)(ia) of the IT Act. The assessee filed a case against the Assistant Commissioner of Income Tax (respondent) before the ITAT.

The assessee filed a miscellaneous application before the ITAT for recalling its order claiming that while passing the order the ITAT did not follow the decision rendered by it in the case of Mahindra and Mahindra Ltd. for the very same issue which was decided in favour of the assessee.

It was submitted on behalf of the respondent that the assessee has not submitted the break-up that was due based on the year-end provision made for various expenses.

The matter was listed before the Coram consisting of M. Balaganesh and Mahavir Singh. The ITAT directed the AO to delete the disallowance under Section 40(a)(ia) of the IT Act.

The ITAT found that the entire break-up had been duly submitted by the assessee before the lower authorities the figures mentioned are fairly ascertainable and are not mere adhoc provisions.

The ITAT stated, "The Tribunal while disposing of the appeal had rejected the contentions of the assessee and upheld the disallowance made u/s.40(a)(ia) of the IT Act. But we find that a contrary view has already been taken by this Tribunal in the case of Mahindra and Mahindra vide its order dated 19 June 2020. Non-following of the said order constitute a mistake apparent on record within the meaning of Section 254(2) of the IT Act."