M/s. A.B. Construction, Kolkata V. DCIT, C ircle- 49, Kolkata, Kolkata

ITA 1508/KOL/2010

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 48093 (ITAT-KOLKATA)
• Duration Of Justice: 8 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-04-2011
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Next Hearing Date: 26-04-2011
• Assessment Year: 2006-2007
• Appeal Filed On: 29-07-2010
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: S C JAIN
• Assessee Lawyers: A K CHAKRABORTY; D SAHA
• Keywords: Bonafide belief
• Section: 43B; 143(3)

Judgement Text

, A , IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH: KOL KATA () , , , !' ) [BEFORE HONBLE SRI MAHAVIR SINGH, JM & HONBLE SHR I AKBER BASHA, AM] # # # # / I.T.A NO. 1508/KOL/2010 $% &' $% &' $% &' $% &'/ // / ASSESSMENT YEAR: 2006-07 M/S. A. B. CONSTRUCTION VS. DEPUTY COMMISSIONER OF INCOME-TAX (PAN-AAFFA 2478 M) CIRCLE-49, KOLKATA. ()* /APPELLANT ) (+,)*/ RESPONDENT ) FOR THE APPELLANT: S/SHRI A. K. CHAKRABORTY & D. SAHA FOR THE RESPONDENT: SHRI S. C. JAIN ! / ORDER PER SHRI MAHAVIR SINGH/ : THIS APPEAL BY ASSESSEE IS ARISING OUT OF THE ORDER OF CIT(A)-XXXII, KOLKATA IN APPEAL NO. 91/CIT(A)-XXXII/08-09/CIR-49/KOL DATED 0 3.02.2010. THE ASSESSMENT WAS FRAMED BY DCIT, CIRCLE-49, KOLKATA, U/S. 143(3) OF THE INCOME TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT) FOR ASSESSMENT YEAR 2006- 07 VIDE HIS ORDER DATED 27.11.2008. 2. THE FIRST ISSUE IN THIS APPEAL OF THE ASSESSEE I S AGAINST THE ORDER OF CIT(A) CONFIRMING THE ADDITION OF AMOUNT NOT RECEIVED DURING THE YEAR UNDER CONSIDERATION. FOR THIS, ASSESSEE HAS RAISED THE FOLLOWING GROUND NO.1: 1. FOR THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) ERRED IN SUSTAINING THE ADDITION OF RS.5,99,585/- IGNORING T HE CONTENTION THAT THE SAID AMOUNT WAS NOT RECEIVED DURING THE YEAR UNDER CONSI DERATION. MOREOVER THERE WAS NO SCOPE TO KNOW THE ACCRUAL OF THE SAID AMOUNT IN THE YEAR IN QUESTION. 3. WE HAVE HEARD RIVAL SUBMISSIONS AND GONE THROUGH FACTS AND CIRCUMSTANCES OF THE CASE. THE BRIEF FACTS ARE THAT THE ASSESSING OFFICER RECE IVED ANNUAL INFORMATION RETURN (AIR) INFORMATION IN RESPECT OF CONTRACT RECEIPTS IN RESP ECT OF ASSESSEE AMOUNTING RS.2,77,77,585/-, AS AGAINST DISCLOSED RECEIPTS ONLY AT RS.2,71,78,00 0/-. THE ASSESSING OFFICER WAS OF THE VIEW THAT THE BALANCE RECEIPT OF RS.5,99,585/- HAS NOT B EEN DISCLOSED BUT WAS RECEIVED DURING RELEVANT ASSESSMENT YEAR 2006-07. THE ASSESSING OF FICER WAS OF THE VIEW THAT ASSESSEE IS MAINTAINING MERCANTILE SYSTEM OF ACCOUNTING AND REC EIPTS HAVE ALREADY BEEN ACCRUED, THE SAME SHOULD HAVE BEEN PART OF THE P&L ACCOUNT. ACCORDIN GLY, HE ADDED THESE RECEIPTS TO THE TOTAL INCOME OF THE ASSESSEE AND CIT(A) ALSO CONFIRMED TH E ADDITION BY GIVING FOLLOWING FINDING: 2 ITA 1508/K/201 0 A.B. CONSTRUCTION A.Y. 06-07 AS PER THE INFORMATION RECEIVED BY THE A.O. FROM A IR SYSTEM, TAX HAD BEEN COLLECTED AT SOURCE ON ACCOUNT OF PAYMENTS MADE OR ACCRUED TO TH E ASSESSEE DURING THE RELEVANT PREVIOUS YEAR TO THE TUNE OF RS.2,77,77,585/- BUT T HE ASSESSEE HAD ACCOUNTED FOR THE INCOME OF RS.2,71,78,000/- ONLY. THE ASSESSEE CONT ENDED THAT THE DIFFERENCE OF SUM OF RS.5,99,585/- WAS NOT TAKEN INTO CONSIDERATION AS I NCOME FOR THE REASON THAT THE SAME WAS NOT RECEIVED BY IT DURING THE RELEVANT PREVIOUS YEAR. THIS CLAIM OF THE ASSESEE IS NOT CORRECT SINCE IT IS FOLLOWING THE MERCANTILE SYSTEM OF ACCOUNTING. THE ASSESSEE OR ITS A.R. HAVE NOT BEEN ABLE TO PRODUCE ANY EVIDENCE THA T THE ASSESSEE HAD NO INTIMATION OR KNOWLEDGE ABOUT THE ACCRUAL OF SUCH INCOME OF RS.5, 99,585/- DURING THE RELEVANT PREVIOUS YEAR. FOR THE ABOVE REASON I DO NOT FIND ANY FORCE IN THE CONTENTION OF THE ASSESSEE AS RAISED BEFORE ME AND THE ACTION OF THE A.O. IN INCLUDING THE INCOME OF RS.5,99,585/- AS PART OF ASSESSEES INCOME FOR THE RELEVANT PREVIOUS YEAR IS IN ACCORDANCE AND IN CONFORMITY WITH THE ESTABLISHED ACCOUNTING S TANDARDS AND PRINCIPLE. THEREFORE, THE ADDITION MADE BY THE A.O. TO THAT EXTENT IS CON FIRMED. 4. WE FIND THAT THE ASSESSEE IS A CIVIL CONTRACTOR AND HAS RECORDED RECEIPTS AT RS 2,71,78,000/- ONLY FOR THE REASON THAT IT HAD NOT R ECEIVED PAYMENT AS PER CERTIFICATE DESPITE RAISING OF BILLS. THE CONTENTION OF THE ASSESSEE B EFORE US WAS THAT THE CONTRACTEE SENT THIS CHEQUE WITH THE PAYMENT CERTIFICATE AND ON THE BASI S OF THE SAME ENTRIE IN THE BOOKS OF ACCOUNT WAS MADE. BUT AS PER AIR INFORMATION, THE ASSESSING OFFICER HAS RIGHTLY MADE THE ADDITION OF DIFFERENTIAL AMOUNT OF RS.5,99,585/-, BECAUSE, WHET HER IT IS IN THE KNOWLEDGE OF THE ASSESSEE, REGARDING THIS RECEIPT, OR NOT, THIS PAYMENT HAS AC CRUED TO HIM AS HE IS FOLLOWING MERCANTILE SYSTEM OF ACCOUNTING. ACCORDINGLY, WE ARE OF THE V IEW THAT THE ASSESSING OFFICER HAS RIGHTLY MADE THE ADDITION AND CONFIRMED BY CIT(A). THE ASS ESSEE MAY BE UNDER BONAFIDE BELIEF THAT IT HAS NOT RECEIVED THIS PAYMENT BUT IT HAS RAISED BIL LS AND THE ITEM OF RECEIPT HAS ACCRUED TO IT. ACCORDINGLY, WE CONFIRM THE ACTION OF THE CIT(A) AN D THIS ISSUE OF ASSESSEES APPEAL IS DISMISSED. 5. THE NEXT ISSUE IN THIS APPEAL OF THE ASSESSEE IS AGAINST THE ORDER OF CIT(A) CONFIRMING THE DISALLOWANCE OF SALES TAX PAID BY CONTRACTEE BY INVOKING PROVISIONS OF SECTION 43B OF THE ACT. FOR THIS, THE ASSESSEE HAS RAISED FOLLOWING G ROUND NO.2: 2. FOR THAT HAVING REGARD TO THE FACTS AND CIRCUMS TANCES OF THE CASE, THE LD. CIT(A) OUGHT TO HAVE ALLOWED THE DISALLOWANCES OF RS.5,64, 010/- AS MADE BY ASSESSING OFFICER UNDER SECTION 43B OF THE INCOME TAX ACT, 1961. 6. THE BRIEF FACTS ARE THAT THE ASSESSEE DEBITED A SUM OF RS.5,64,010/- ON ACCOUNT OF SALES TAX TO ITS P & L ACCOUNT FOR THE FY 2005-06 RELEVAN T TO ASSESSMENT YEAR 2006-07. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSING OFF ICER REQUIRED THE ASSESSEE TO FILE PROOF OF PAYMENT OF SALES TAX SO THAT DEDUCTION CAN BE ALLOW ED. THE ASSESSEE STATED THAT THE SALES TAX WAS DEDUCTED BY THE CONTRACTEE AND FILED PROOF IN T HE SHAPE OF TDS CERTIFICATES WHEREBY THE 3 ITA 1508/K/201 0 A.B. CONSTRUCTION A.Y. 06-07 SALES TAX WAS DEDUCTED BY THE CONTRACTEE BUT THE AS SESSING OFFICER HAS NOT ACCEPTED THE EXPLANATION OF THE ASSESSEE AND NOTED THAT SECTION 43B OF THE ACT IS APPLICABLE TO THE CASE OF THE ASSESSEE, AS THE ASSESSEE IS UNABLE TO PROVE TH E PAYMENT OF SUCH TAX OR DUTY AND MOREOVER IT IS NOT KNOWN WHETHER THE SAME HAS BEEN ACTUALLY PAI D TO THE GOVT. EXCHEQUER OR NOT. ACCORDINGLY, HE DISALLOWED THE DEDUCTION. AGGRIEVE D, ASSESSEE PREFERRED APPEAL BEFORE CIT(A) AND HE ALSO CONFIRMED THE ACTION OF THE ASSE SSING OFFICER EVEN THOUGH NOTED THAT IN MY OPINION IF THE SALES TAX HAS BEEN DEDUCTED AT S OURCE BY THE PAYER WHILE MAKING THE PAYMENT TO THE ASSESSEE, SUCH SALES TAX SHALL BE DE EMED TO HAVE BEEN PAID BY THE ASSESSEE PROVIDED THAT SUCH SALES TAX DEDUCTED AT SOURCE IS DEPOSITED BY THE DEDUCTOR TO THE GOVT. ACCOUNT BEFORE THE DUE DATE OF FILING OF RETURN OF INCOME BY THE ASSESSEE. THE CIT(A) FURTHER OBSERVED THAT HOW THE ASSESSEE HAS ACCOUNTED FOR SU CH SALES TAX BUT THE ASSESSEE IS UNABLE TO PRODUCE ANY EVIDENCE THAT THE SALES TAX SO DEDUCTED BY THE PAYER HAS BEEN DEPOSITED IN THE GOVT. ACCOUNT BEFORE THE DUE DATE AND ACCORDINGLY, HE SET ASIDE THE ISSUE TO THE FILE OF THE ASSESSING OFFICER DIRECTING HIM TO VERIFY. AGGRIEV ED, ASSESSEE IS IN APPEAL BEFORE US. 7. WE HAVE HEARD RIVAL SUBMISSIONS AND GONE THROUGH FACTS AND CIRCUMSTANCES OF THE CASE. WE FIND THAT CONTRACTEE HAS DEDUCTED SALES TAX AT S OURCE AND ISSUED CERTIFICATE ALONG WITH TDS CERTIFICATE. THE TDS CERTIFICATE CLEARLY REVEALS, AS NOTED BY LOWER AUTHORITIES, THAT THE CONTRACTEE HAS DEDUCTED SALES TAX AND MORE PARTICUL ARLY, CIT(A) CLEARLY OBSERVED THAT THIS SALES TAX HAS BEEN DEDUCTED BY THE PAYER WHILE MAKING PAY MENT TO ASSESSEE. BUT HE HIMSELF GOT CONFUSED IN THE CONCEPT. ONCE THE CONTRACTEE ISSUE D THE CERTIFICATE, IT CAN BE VERIFIED FROM HIM ONLY BECAUSE HE HAS DEDUCTED SALES TAX AND NOT THE ASSESSEE. WE ARE OF THE VIEW THAT THE DEDUCTOR HAD TO PAY SALES TAX AND NOT THE DEDUCTEE. HERE, THE ASSESSING OFFICER AS WELL AS CIT(A) HAS LAID DOWN IMPOSSIBLE BURDEN AND IT IS NO T THE DUTY OF THE ASSESSEE TO PAY SALES TAX RATHER IT IS THE CONTRACTEE, WHO HAS DEDUCTED TAX O N BEHALF OF THE ASSESSEE AND HE WILL PAY THE SALES TAX ON ACCOUNT OF THE ASSESSEE. LD. COUNSEL F OR THE ASSESSEE FILED A COPY OF JUDGMENT OF HONBLE APEX COURT IN THE CASE OF CIVIL APPEAL NOS. 140-143 OF 1973, SUPDT. OF TAXES, DHUBRI & ORS. VS. M/S. ONKARMAL NATHMAL TRUST, AIR 1975 SC 2065, WHEREIN IT IS HELD AS UNDER: THE FIRST CONTENTION ON BEHALF OF THE STATE THAT IT BECAME IMPOSSIBLE FOR THE STATE TO ISSUE NOTICE UNDER SECTION 7(2) OF THE NEW ACT WITH IN TWO YEARS OF THE EXPIRY OF THE PERIOD OF RETURN IS UNSOUND ON PRINCIPLE AND FACTS. THE MAXIM LEX NON COGIT AD IMPOSSIBILIA MEANS THAT THE LAW DOES NOT COMPEL A M AN TO DO THAT WHICH HE CANNOT POSSIBLY PERFORM. IN THE PRESENT APPEALS, THE APPL ICATIONS WERE MOVED IN THE HIGH COURT FOR STAY OF PROCEEDINGS. THE RESPONDENTS CHA LLENGED THE VALIDITY OF THE ACT, AND THEREFORE, ASKED FOR AN INJUNCTION RESTRAINING THE STATE FROM TAKING PROCEEDINGS UNDER THE ACT. AT NO STAGE, DID THE STATE ASK FOR VARIAT ION OR MODIFICATION OF THE ORDER OF INJUNCTION. IT IS WELL KNOWN THAT IF IT IS BROUGHT TO THE NOTICE OF A COURT THAT PROCEEDINGS 4 ITA 1508/K/201 0 A.B. CONSTRUCTION A.Y. 06-07 ARE LIKELY TO BE BARRED BY TIME BY REASON OF ANY OR DER OF INJUNCTION OR STAY THE COURT PASSES SUCH SUITABLE OR APPROPRIATE ORDERS AS WILL PROTECT THE INTEREST OF THE PARTIES AND WILL NOT PREJUDICE EITHER PARTY. EVEN WHEN CERTIFI CATE TO APPEAL TO THIS COURT WAS GRANTED ON 1 AUGUST, 1963, THE STATE DID NOT ASK FO R ANY ORDER FOR STAY OF OPERATION OF THE JUDGMENT. THAT IS QUITE OFTEN DONE. FOR THE F IRST TIME, ON 10 AUGUST, 1964 THE STATE FILED AN APPLICATION FOR STAY OF OPERATION OF THE J UDGMENT OF THE HIGH COURT, THE STATE DID NOT TAKE STEPS AT THE APPROPRIATE TIME. THIS CO URT ON 28 OCTOBER, 1964 GRANTED AN INTERIM ORDER STAYING THE OPERATION OF THE HIGH COU RT JUDGMENT. THE INTERIM ORDER WAS MADE ABSOLUTE ON 28 JANUARY, WITH CERTAIN CONDITION S. THE STATE CANNOT TAKE ADVANTAGE OF ITS OWN WRONG AND LACK OF DILIGENCE. THE STATE C ANNOT CONTEND THAT IT WAS IMPOSSIBLE TO ISSUE ANY NOTICE WITHIN THE PERIOD MENTIONED IN SECTION 7 (2) OF THE NEW ACT. THE STATE DID NOT ENDEAVOUR TO OBTAIN APPROPRIATE ORDER S TO SURMOUNT THE DIFFICULTIES BY REASON OF THE INJUNCTION AGAINST TAKING STEPS WITHI N THE TIME CONTEMPLATED IN SECTION 7 (2) OF THE NEW ACT. THE STATE IS GUILTY OF DEFAULT. THE STATE HAD REMEDIES OPEN TO TAKE STEPS BY ASKING FOR MODIFICATION OF THE ORDER. THE STATE HAD TO ASSERT THE RIGHT THAT THE STATE WAS ENTITLED TO DEMAND TAXES AND THE RESPONDE NT WAS LIABLE TO PAY THE SAME. THE STATE FOLLOWED THE POLICY OF INACTIVITY. INACTIVITY IS NOT IMPOSSIBILITY. THE ORDER OF INJUNCTION IS NOT TO BE EQUATED WITH AN ACT OF GOD OR AN ACTION OF THE ENEMY OF THE STATE OR A GENERAL STRIKE. WE FIND THAT THE ASSESSEE IS UNDER NO OBLIGATION TO DEDUCT SALES TAX AND MOREOVER HE IS NOT THE PERSON WHO IS MAKING PAYMENT RATHER IT IS THE CONTR ACTEE WHO IS MAKING PAYMENT TO THE ASSESSEE AND DEDUCTING SALES TAX. ONCE IT IS THE C ONTRACTEE WHO HAS DEDUCTED SALES TAX AND PAID TO THE EXCHEQUER AS PER THE WEST BENGAL SALES TAX A CT, 1994. EVEN THE WEST BENGAL SALES TAX ACT, 1994 CAST A DUTY ON THE CONTRACTEE TO MAKE DEDUCTION AT SOURCE FROM PAYMENT TO A DEALER AGAINST EXECUTION OF WORK CONTRACT. IT IS T HE PERSON MAKING SUCH DEDUCTION SHALL DEPOSIT THE AMOUNT SO DEDUCTED INTO GOVT. TREASURY WITHIN S UCH TIME, IN SUCH MANNER AND IN SUCH FORM AS MAY BE PRESCRIBED. HERE IN THE PRESENT CASE THE CONTRACTEE HAS DEDUCTED THE SALE TAX AND IT IS HIS DUTY TO DEPOSIT THE SALES TAX, WHICH HE HAS DON E PERFECTLY. THIS FACT IS PROVED FROM THE TDS CERTIFICATE, WHICH CLEARLY REVEALED THAT SALES TAX IS DEDUCTED AND DEPOSITED BY CONTRACTEE. ACCORDINGLY, THE LOWER AUTHORITIES HAVE ERRED IN NO T ACCEPTING THE EXPLANATION OF THE ASSESSEE. WE DECIDE THIS ISSUE IN FAVOUR OF THE ASSESSEE ALLO WING THE CLAIM. THIS ISSUE OF THE ASSESSEES APPEAL IS ALLOWED. 8. THE NEXT ISSUE IN THIS APPEAL OF THE ASSESSEE IS AGAINST THE ORDER OF CIT(A) CONFIRMING THE DISALLOWANCE OF MACHINERY HIRE CHARGES BY INVO KING PROVISIONS OF SECTION 40(A)(IA) OF THE ACT AS TDS IS NOT DEDUCTED ON THE SAME. FOR THIS, ASSESSEE HAS RAISED FOLLOWING GROUND NO.3: FOR THAT, ON THE FACTS, THE LD. CIT(A) ERRED IN CO NFIRMING THE ADDITION OF RS.22,60,590/- UNDER SECTION 40(A)(IA) OF THE INCOM E TAX ACT, 1961. MOREOVER, THE SAID PROVISION IS NOT APPLICABLE IN THE ASSTT. YEAR UNDE R CONSIDERATION. 9. BRIEF FACTS LEADING TO THE ABOVE ISSUE ARE THAT THE ASSESSING OFFICER DURING THE COURSE OF ASSESSMENT PROCEEDINGS NOTICED THAT ASSESSEE HAD PA ID MACHINERY HIRE CHARGES AMOUNTING TO RS.22,60,590/- AND NO TDS HAS BEEN DEDUCTED ON THE SAME. THE ASSESSING OFFICER DISALLOWED 5 ITA 1508/K/201 0 A.B. CONSTRUCTION A.Y. 06-07 THE ENTIRE MACHINERY HIRE CHARGES BY INVOKING THE P ROVISIONS OF SECTION 40(A)(IA) OF THE ACT. AGGRIEVED, ASSESSEE PREFERRED APPEAL BEFORE CIT(A) AND HE ALSO CONFIRMED THE ACTION OF THE ASSESSING OFFICER BY GIVING FOLLOWING FINDING: DURING THE COURSE OF APPELLATE PROCEEDINGS THE A.R . OF THE ASSESEE SUBMITTED THAT NO DETAILS IN THIS RESPECT WERE AVAILABLE WITH THE ASS ESSEE. IN THE LIGHT OF THE ABOVE FACTS I FIND NO REASON TO INTERFERE WITH THE DISALLOWANCE M ADE BY THE A.O. ACCORDINGLY, THE DISALLOWANCE OF RS.22,60,590/- IS CONFIRMED. AGGRIEVED, NOW ASSESSEE IS IN APPEAL BEFORE US. 10. WE HAVE HEARD RIVAL SUBMISSIONS AND GONE THROUG H MATERIAL FACTS AND CIRCUMSTANCES OF THE CASE. WE FIND FROM THE ARGUMENT OF LD. COUNSEL FOR THE ASSESSEE, WHO REFERRED TAX LAWS (AMENDMENT) ACT, 2006 AND PARTICULAR AMENDMENT OF S ECTION 40 READS AS UNDER: 8. AMENDMENT OF SECTION 40 IN SECTION 40 OF THE INCOME-TAX ACT, IN CLAUSE (A), IN SUB- CLAUSE (IA), WITH EFFECT FROM THE 1 ST DAY OF APRIL, 2006,- (A) AFTER THE WORDS COMMISSION OR BROKERAGE, THE WORDS RENT, ROYALTY. SHALL BE INSERTED; (B) IN THE EXPLANATION, AFTER CLAUSE (IV), THE FOLL OWING CLAUSES SHALL BE INSERTED AT THE END, NAMELY:- (V) RENT SHALL HAVE THE SAME MEANING AS IN CLAU SE (I) TO THE EXPLANATION TO SECTION 194-I; (VI) ROYALTY SHALL HAVE THE SAME MEANING AS IN E XPLANATION 2 TO CLAUSE (VI) OF SUB-SECTION (1) OF SECTION 9; LD. COUNSEL FOR THE ASSESSEE, AT THE TIME OF HEARIN G BEFORE US, DREW OUR ATTENTION TO SECTION 194-I, BY VIRTUE OF THIS AMENDMENT W.E.F. ASSESSMEN T YEAR 2007-08 BY THE TAXATION LAWS (AMENDMENT) ACT, 2006, ENLARGED THE SCOPE OF RENT FOR THE PURPOSE OF SECTION 194-I, SO AS TO INCLUDE MACHINERY, PLANT AND EQUIPMENT, WHETHER REN TED TOGETHER WITH BUILDING OR SEPARATELY IRRESPECTIVE OF THE FACT THAT THEY ARE OWNED BY THE PAYEE OR NOT. THE LD. COUNSEL FURTHER STATED THAT IN VIEW OF THE ABOVE AMENDMENT W.E.F. 1 ST JUNE, 2007, WHICH IS APPLICABLE FOR AND FROM ASSESSMENT YEAR 2007-08, TAX IS TO BE DEDUCTED AT T HE TIME OF PAYING RENT EXCEEDS RS.1,20,000/- DURING ANY OF THE FINANCIAL YEAR. IN VIEW OF THIS, THE LD. COUNSEL FOR THE ASSESSEE STATED THAT THE PROVISIONS OF SECTION 40(A)(IA) R.W.S. 194-I AS AMENDED, WILL NOT APPLY FOR THE RELEVANT ASSESSMENT YEAR UNDER CONSIDERATION I.E. ASSESSMENT YEAR 2006-07. THE LD. DR, ON THE OTHER HAND, COULD NOT CONTROVERT THIS LEGAL POSITION. 11. WE FIND THAT PROVISIONS OF SECTION 194-I HAS AM ENDED W.E.F. 1.6.2007 WILL BE APPLICABLE W.E.F. 1.6.2007 FOR AND FROM ASSESSMENT YEAR 2007-0 8 AND NOT TO THE PRESENT ASSESSMENT YEAR 2006-07. ONCE THE PROVISIONS OF SECTION 40(A)(IA) AS WELL AS SECTION 194-I WILL NOT APPLY, THERE IS NO REQUIREMENT OF DEDUCTION OF TDS IN THE PRESEN T ASSESSMENT YEAR. ACCORDINGLY, WE DELETE 6 ITA 1508/K/201 0 A.B. CONSTRUCTION A.Y. 06-07 THE DISALLOWANCE MADE BY ASSESSING OFFICER AND CONF IRMED BY CIT(A). THIS ISSUE OF THE ASSESSEES APPEAL IS ALLOWED. 12. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS PA RTLY ALLOWED. 13. ORDER IS PRONOUNCED IN THE OPEN COURT. SD/- SD/- , !' , (AKBER BASHA) (MAHAVIR SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER ( -' -' -' -') )) ) DATED 26TH APRIL, 2011 ./ $01 2 JD.(SR.P.S.) ! 3 +4 5!4&6- COPY OF THE ORDER FORWARDED TO: 1 . )* / APPELLANT M/S. A. B. CONSTRUCTION, 14, DUTTABAD ROAD, SALT LAKE CITY, KOLKATA-700 064. 2 +,)* / RESPONDENT DCIT, CIRCLE-49, KOLKATA. 3 . $ ( )/ THE CIT(A), KOLKATA 4. 5. $ / CIT KOLKATA 4<= +$ / DR, KOLKATA BENCHES, KOLKATA ,4 +/ TRUE COPY, ! $>/ BY ORDER, 1 /ASSTT. REGISTRAR .