$ * IN HIGH COURT OF DELHI AT NEW DELHI 6. + ITA 95/2015 COMMISSIONER OF INCOME TAX-21 (ERSTWHILE CIT-XIII) ..... Appellant Through: Ms Suruchi Aggarwal, Senior Standing Counsel with Ms Lakshmi Gurung, Junior Standing Counsel, Ms Radhika Gupta and Mr Abhishek Sharma, Advocates. versus DR. JAIDEEP KUMAR SHARMA ..... Respondent Through: Mr Gautam Jain, Advocate. AND 8. + ITA 352/2015 COMMISSIONER OF INCOME TAX-21 (ERSTWHILE CIT-XIII) ..... Appellant Through: Ms Suruchi Aggarwal, Senior Standing Counsel with Ms Lakshmi Gurung, Junior Standing Counsel, Ms Radhika Gupta and Mr Abhishek Sharma, Advocates. versus DR. JAIDEEP KUMAR SHARMA ..... Respondent Through: Mr Gautam Jain, Advocate. CORAM: JUSTICE S. MURALIDHAR JUSTICE VIBHU BAKHRU ORDER % 19.11.2015 ITA Nos.95 & 352 of 2015 Page 1 of 4 1. These appeals by Revenue are directed against common order dated 25th July, 2014 passed by Income Tax Appellate Tribunal ( ITAT ) in ITA No.5696/Del/2011 for Assessment Year ( AY ) 2008-09 and ITA No.3893/Del/2010 for AY 2007-08. 2. Assessee is Doctor and is carrying on his professional activities at his diagnostic centre i.e. Dr. Jaideep s Diagnostic Centre, 30 JCM DLF-II, Gurgaon. He is Proprietor of said Centre. Assessee filed return of income on 26th September, 2008 declaring income of Rs.7,95,291/-. return was picked up for scrutiny and notice was issued to Assessee by Assessing Officer ( AO ). During course of assessment proceedings, it was noticed that Assessee had debited sum of Rs.56,21,675/- under head Lab Test Expense . It was noticed that this payment was made to M/s SRL Ranbaxy Ltd. without deduction of tax at source although payment was covered under Section 194J of Act. Accordingly, AO disallowed expense under Section 40(a)(ia) of Act and added it back to income of Assessee. 3. Aggrieved by order of AO, Assessee filed appeal before Commissioner of Income Tax (Appeals) [CIT(A)]. CIT(A) accepted ITA Nos.95 & 352 of 2015 Page 2 of 4 plea of Assessee that payment made to M/s SRL Ranbaxy Ltd. was not liable for deduction under Section 194J of Act. 4. ITAT has in impugned order dated 25th July, 2014 referred to insertion of second proviso to Section 40(a)(ia) of Act by Finance Act, 2012 as discussed by Agra Bench of ITAT in case of Rajiv Kumar Aggarwal v. CIT (order dated 29th May, 2013 in ITA No.337/Agra/2013) which in turn followed decision of this Court in CIT v. Rajinder Kumar 362 ITR 241. It was held that second proviso is declaratory and curative in nature. It was held that as long as corresponding income was brought to tax in hands of payee, it was not intended to disallow expenditure in hands of payer due to non deduction of tax at source. 5. ITAT has in impugned order in present case noted that Assessee has filed necessary confirmation from payee that they have paid amount received from Assessee. confirmation filed by Assessee was enclosed in paper book filed before CIT(A). 6. In similar circumstances, this court recently in CIT v. Ansal Landmark Township (P.) Ltd. (2015) 377 ITR 635 (Del) decided similar issue in ITA Nos.95 & 352 of 2015 Page 3 of 4 favour of Assessee approving order of Agra Bench of ITAT in Rajiv Kumar Aggarwal (supra). 7. While admitting present appeal on 27th February, 2015 following questions were framed for consideration: Did ITAT fall into error in holding that disallowance under Section 40 (a) (ia) on account of assessee not following provisions of Section 194 (J) and 194 (C) in given facts of this case, was not justified. 8. In light of above discussion, question is answered in negative i.e. in favour of Assessee and against Revenue. appeal is dismissed. S. MURALIDHAR, J VIBHU BAKHRU, J NOVEMBER 19, 2015 MK ITA Nos.95 & 352 of 2015 Page 4 of 4 Commissioner Of Income Tax-21 (Erstwhile CIT-XIII) v. DR. Jaideep Kumar Sharma