406 October 20 To October 26, 2018 u Taxmann’s Corporate Professionals Today u Vol. 43 u^48
assessee had not complied with TDS provi-
sions which had resulted in non-compliance
of provisions of section 194C on pay-outs/
dues to Driver-Partners. Accordingly, asses-
see was treated in default and demands of
24.92 crores and 84.13 crores for assess-
ment years 2016-17 and 2017-18 were raised
and penalty proceedings initiated.
Assessee had denied liability to deduct TDS
under section 194C on ground that it was not
a ‘person responsible for making payment’ to
Driver-Partners as contract was between Uber
B.V. & Driver-Partners. It filed an application
before ITAT for stay of demand.
The Mumbai ITAT held in favour of assessee
as under:
It was submitted by the assessee that the
modus operandi of collecting the payments by
the assessee on behalf of the Dutch company
which were made by way of debit or credit
cards or collecting by the Driver-Partners
directly from the customers. It was also stat-
ed that there were practical difficulties as it
was not possible for the assessee to collect
TDS on the cash payments received by the
Driver-Partners directly.
Since the assessee had proved that the facts
of the case were not properly and thoroughly
examined and verified by the lower author-
ities. Demand raised by the revenue had to
be stayed subject to deposit of ` 20 Crore
till the disposal of appeal by the tribunal
so that the business of the assessee was not
adversely impacted.
Return filed in response to section 148
notice fulfilled requirement of filing of
return as mandated by section 12AGenius Education Society v. ACIT [2018] 98
taxmann.com 54 (Chandigarh - Trib.)
The ITAT held that where return of income
had been filed in response to notice under
section 148, requirement under section 12A
of filing of return of income stood fulfilled.
Since section 12A nowhere prescribes filing
of return by any due date, it could not be
alleged that assessee had not filed its return
within prescribed time. Requirement of fil-
ing report of audit in prescribed form was
merely procedural and, therefore, directory in
nature and not mandatory for the purpose of
claiming exemption under sections 11 and 12. No duction de of provision for
warranty if its estimated cost
wasn’t on basis of past experienceLaser Soft Infosystems Ltd. v. ITO [2018] 98
taxmann.com 51 (Madras)
Assessee was engaged in the business of
software development. During relevant year,
assessee made provision towards liability for
warranty for goods supplied.
In course of assessment, the Assessing Officer
(AO) rejected assessee’s claim for deduction
of said provision on ground that it had not
crystallised or ascertained at the end of the
previous year.
The High Court held in favour of revenue
as under:
Admittedly, the assessee had not placed any
material before the AO with regard to the
previous experience as to how the provision
had been created. AO found that the assessee
had deducted a sum of ` 17,15,000 towards
provision for warranty and he found that it
was made as a provision towards an una-
scertained liability and, therefore, proposed
that it was not an admissible expenditure
being contingent in nature.
In the light of the said provisional conclu-
sion, the assessee submitted a letter stating
that the provision created in the accounts
for the possible costs that might have to be
incurred had to be borne by the assessee
for rectification of the bugs in the software
supplied to the customers and also had to
be done free of charge to customers and it
was claimed that the provision for warrantyWeekly reVieW