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Facts:
For non-deduction of tax at source from the payments made towards advertisement expenses, the AO disallowed the sum of Rs.5.10 lac and taxed the same as business income. Before the CIT(A) the assessee contended that since its income is not chargeable u/s.26 to section 44AD under the head ‘Business income’, the provisions of section 40(a)(ia) were not applicable. However, the CIT(A) upheld the order of the AO.
Held:
Relying on the Amritsar Tribunal decision in the case of ITO v. Sangat Sahib Bhai Pheru Sikh Educational Society, (ITA Nos. 201 to 203/ASR/2004, dated 31- 3-2006), which in turn was based on the Mumbai Tribunal decision in the case of CIT v. India Magnum Fund, (74 TTJ 620), the Tribunal accepted the contention of the assessee and allowed the appeal of the assessee.
