The Delhi Bench of ITAT has held that no disallowance shall be made to the assessee

The Delhi Bench of ITAT has held that no disallowance shall be made to the assessee 

The Delhi Bench of ITAT has held that no disallowance shall be made to the assessee in regards to the chargeable sum paid by the assessee to a foreign company without deduction of tax because the second proviso clause (i) of Section 40(a) has been inserted w.e.f. 1.4.2020. The said proviso essentially provides that where the relevant income has been declared by the payee and tax thereon has been paid by him then no disallowance shall be made in the hands of the payer. This proviso is similar to the second proviso to clause (ia) of s. 40(a) which was inserted w.e.f. 1.4.2013. Both these provisos were inserted to remove an anomaly and were therefore curative and declaratory in nature. Hence they had to be given retrospective effect.



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