IN INCOME TAX APPELLATE TRIBUNAL BENCH, MUMBAI BEFORE SHRI D. KARUNAKARA RAO, ACCOUNTANT MEMBER AND SHRI SAKTIJIT DEY, JUDICIAL MEMBER I.T.A. No. 256/M/2011 (Assessment Year: 2007-2008) M/s. Lily Minerals, ACIT 13(3), st 1 Floor, Mahesh Chambers, Aayakar Bhavan, Vs. 391, Narsi Natha Street, Mumbai 400 020. Masjid Bunder (W), Mumbai -09. PAN : AAAFL2252K (Appellant)..(Respondent) Appellant by : Shri Vijay Kothari Respondent by : Shri A. Ramachandran, DR Date of Hearing : 29.08.2016 Date of Pronouncement : 30 .09.2016 ORDER PER D. KARUNAKARA RAO, AM: This appeal filed by assessee on 11.1.2011 is against order of CIT (A)-24, Mumbai dated 30.11.2010 for assessment year 2007-2008. In this appeal, assessee raised following grounds which read as under:- 1. Ld CIT (A) erred in disallowing u/s 40(a)(ia) amount of Rs. 8,18,201/- being amount of transportation charges paid to following transporters. 1. Shivshakti Roadways Rs. 1,780/- 2. Raja Roadways Rs. 3,706/- 3. Kaka Roadways Rs. 42,340/- 4. Pearl Shipping Rs. 7,70, 375/- Total Rs. 8,18,201/- 2. Ld CIT (A) erred in confirming interest charged u/s 234B and 234C of Act and in facts and circumstances of case and in law, appellant denies its liability for payment of interest under any of provisions of Act. 2. Briefly stated relevant facts of case are that assessee, who is engaged in business of export trade of processed minerals , filed return of income declaring total income of Rs. 90,91,430/-. Assessment was completed u/s 143(3) of Act and determined assessed income of Rs. 99,09,630/-. In assessment, AO made disallowance of Rs. 8,18,201/- u/s 40(a)(ia) of Act in respect of payments of Transportation Charges. Aggrieved, assessee carried matter in appeal before first appellate authority. 2 3. During proceedings before first appellate authority, after considering submissions of assessee, CIT (A) dismissed appeal. Again aggrieved with decision of CIT (A), assessee is in further appeal before Tribunal by raising above mentioned grounds. 4. During proceedings before us, at outset, Ld Counsel for assessee, bringing our attention to grounds, mentioned that AO invalidly invoked provisions of section 40(a)(ia) of Act ignoring provisions of section 194(5) and its proviso. proviso provides for quantum limits for non-applicability of TDS provisions and therefore, provisions of section 40(a)(ia) are not applicable if payments are below such limits. Further, Ld Counsel for assessee submitted that AO added sum of Rs. 8,18,201/- in aggregation. Submitting that it has 4 different items and amounts, Ld AR mentioned that payments of Rs. 1,780/-; Rs. 3,706/- and Rs. 42,340/- are below applicable limitation of Rs. 50,000/- relevant for year under consideration. Ld DR agrees with same. Accordingly, we grant relief to assessee. 5. Referring to payment of 4th item of Rs. 7,70,375/-, Ld AR submitted that this issue can be remanded to file of AO for examining set principle ie no TDS provisions apply, if payment in question constitutes reimbursements . Referring to page 6 of assessees paper book, Ld AR submitted that if remanded, AO will come to conclusions that amount in question constitutes payment by virtue of reimbursement. After hearing both parties, we find that issue should be remanded to file of AO for fresh consideration and assessment. AO shall grant reasonable opportunity of being heard to assessee as per set principles of natural justice. Thus, grounds raised by assessee are allowed for statistical purposes. 6. In result, appeal of assessee is partly allowed for statistical purposes. Order pronounced in open court on 30th September, 2016. Sd/- Sd/- (SAKTIJIT DEY) (D. KARUNAKARA RAO) JUDICIAL MEMBER ACCOUNTANT MEMBER Mumbai; 30.09.2016 . OKK , Sr. PS 3 Copy of Order forwarded to : 1. Appellant 2. Respondent. 3. CIT(A)- 4. CIT 5. DR, ITAT, Mumbai 6. Guard file. //True Copy// BY ORDER, (Dy./Asstt. Registrar) , ITAT, Mumbai M/s. Lily Minerals v. ACIT 13(3), Mumbai