Held that the services of the consultant were utilised for the purposes of SBI in order to secure the assets mortgaged to it. The bank settled the fee and recovered it from the assessee. The TDS provision would be applicable only when the services are utilised and payments are made directly to the service provider. On the facts the assessee neither appointed the consultant nor paid the consultancy charges hence the provision of section 40(a)(ia) of the Act is not applicable. (dt. 30-9-2021)
Hindustan Organic Chemicals Ltd. v. DCIT (2021) BCAJ-November-P. 33 (Mum.)(Trib.)
S. 40(a)(ia) : Amounts not deductible-Deduction at source-Asset valuer’s fees paid by the lender bank and recovered from the assessee-Not liable to deduct tax at source. [S. 194J]