Assessee was engaged in business of providing consultancy services and supply of manpower services to power and infrastructure sector in India and abroad . Assessee created provisions for certain expenses and claimed that tax was deducted when liability to pay such expenses was crystallized on receipt of invoices . Assessing Officer denied said claim on ground that under mercantile system of accounting, accrual of liability for any expenditure was not dependent on receipt of invoices . He  held that assessee-company failed to deduct TDS and levied penalty under section 271C  of the Act .  CIT(A)    deleted penalty on ground that taxes were duly deducted and deposited against impugned expenses when liability to pay such expenses was crystallized . Dismissing the appeal of the Revenue the Tribunal held that  the assessee has made only provision and there was no crystallisation of income in the hands of the recipient at the end of the financial year . Referred ITO v. DLF Southern Homes (P) Ltd  2017 SCC Online ITAT 148 / DCIT v. Telco Construction Equipment Co Ltd ( ITA. 478 /Bang /2012  dt.7-3 -2014 .  (AY. 2013 -14 )