Shri Rameshchandra Thakarshi Shah, Ahmedabad V. The Income tax Officer,Ward-9(1), Ahmedabad

ITA 167/AHD/2010

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 60449 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 4 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-05-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Assessment Year: 2006-2007
• Appeal Filed On: 19-01-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SHRIVINOD TANWANI
• Section: 194C

Judgement Text

ITA NO.1 67/AHD/2010 ASSESSME NT YEAR 2006- 07 . 1 IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, AHMEDABAD (BEFORE SHRI G.C.GUPTA VICE PRESIDENT & SHRI ANIL C HATURVEDI, A.M.) I.T.A. NO.167 /AHD/2010 (ASSESSMENT YEAR: 2006 - 07) SHRI RAMESHCHANDRA T. SHAH, PROP. JYOTI BUILDERS, 2-B NALKUNG SOCIETY, VIJAY NAGAR ROAD, NARANPURA, AHMEDABAD. (APPELLANT) VS. THE INCOME TAX OFFICER, WARD 9(1), KENDRIYA PRATYAKSHA BHAVAN, NEAR PANJARA POLE, AMBAWADI, AHMEDABAD. (RESPONDENT) PAN: AIIPS 7429P APPELLANT BY : NONE (WRITTEN SUBMISSION) RESPONDENT BY : SHRIVINOD TANWANI, SR. D.R. ( )/ ORDER DATE OF HEARING : 16-5-2012 DATE OF PRONOUNCEMENT : 25-5-2012 PER: SHRI ANIL CHATURVEDI,ACCOUNTANT MEMBER. THIS APPEAL IS FILED BY THE ASSESSEE AGAINST THE OR DER OF LD. CIT (A)-XV, AHMEDABAD DATED 12-11-2009 FOR THE ASSESSME NT YEAR 2006- 07. ITA NO.1 67/AHD/2010 ASSESSME NT YEAR 2006- 07 . 2 2 ON THE DATE OF HEARING NOBODY APPEARED ON BEHALF OF THE APPELLANT NOR ANY ADJOURNMENT APPLICATION WAS RECEI VED FROM ASSESSEE. THE ASSESSEE HAS HOWEVER SUBMITTED WRITTE N SUBMISSIONS. WE ARE THEREFORE DECIDING THE APPEAL ON THE BASIS O F MATERIAL ON RECORD AND THE WRITTEN SUBMISSIONS. 3. BRIEF FACTS OF THE CASE ARE THAT ASSESSEE IS AN INDIVIDUAL ENGAGED IN THE BUSINESS OF CONSTRUCTION ACTIVITIES. THE ASSESSEE FILED ITS RETURN OF INCOME ON 7-9-2006 DECLARING TOTAL IN COME OF RS.6,45,313/-. THE RETURN WAS PROCESSED U/S. 143(1) ON20-12-2006 ACCEPTING THE RETURNED INCOME. SUBSEQUENTLY, CASE W AS SELECTED FOR SCRUTINY. DURING THE COURSE OF ASSESSMENT PROCEEDIN GS, THE A.O. OBSERVED FROM THE COPY OF ACCOUNT OF M/S. NEW BHARA T WATERPROOFING CORPORATION, THAT TAX WAS DEDUCTED AT SOURCE FROM T HE BILL DATED15-2- 2006 FOR RS.2,16,000/- BUT THE SAME WAS NOT DEPOSIT ED INTO THE GOVERNMENT ACCOUNT BEFORE THE END OF F.Y. 2005-06. SINCE THE TDS WAS DEPOSITED LATE IN CONTRAVENTION OF SECTION 194C , THE ASSESSEE WAS ISSUED SHOW CAUSE NOTICE. IN RESPONSE TO THE SH OW CAUSE NOTICE, THE ASSESSEE REPLIED THAT SINCE THE BILLS WERE IN D ISPUTE DUE TO MEASUREMENT AND MATERIAL QUALITY, THE TAX WAS NOT D EDUCTED AND THEREFORE NOT PAID THE TAX. THE CONTENTION OF THE A SSESSEE WAS NOT ACCEPTED BY THE A.O. AND HE HELD THAT THE PAYMENT A MOUNTING TO RS.2,16,000/- WAS IN VIOLATION OF SECTION 194C R.W. S. 40(A)(IA) AND THEREFORE, DISALLOWED IT AND ADDED TO THE TOTAL IN COME. THE ASSESSEE BEING AGGRIEVED BY THE ORDER OF A.O. CARRIED THE MA TTER IN APPEAL BEFORE THE CIT (A). ITA NO.1 67/AHD/2010 ASSESSME NT YEAR 2006- 07 . 3 4. CIT (A) HELD THAT THE ASSESSEE WAS REQUIRED TO D EDUCT AND DEPOSIT THE TAX BEFORE 31-3-2006. AS THE ASSESSEE D ID NOT DEPOSIT TDS BEFORE 31 ST MARCH, 2006, NO DEDUCTION WAS ALLOWABLE TO ASSESSE E AND ACCORDINGLY HE UPHELD THE ORDER OF A.O. 5. AGGRIEVED BY THE ORDER OF CIT (A), THE ASSESSEE IS NOW IN APPEAL BEFORE US. 6. BEFORE US THE ASSESSEE HAS MADE WRITTEN SUBMISS IONS WHEREIN IT HAS BEEN SUBMITTED BY THE ASSESSEE THAT THE TAX HAS BEEN DEDUCTED AND PAID ON IMPUGNED LABOUR EXPENDITURE OF RS.2,16, 000/- ON 24-4- 2006 I.E. BEFORE THE DUE DATE OF FILING OF THE RETU RN. HE THEREFORE, SUBMITTED THAT SINCE THE TDS HAS BEEN PAID BEFORE T HE FILING OF THE RETURN THE SAME SHOULD BE ALLOWED AS DEDUCTION. HE FURTHER SUBMITTED THAT HIS CASE IS COVERED BY THE DECISION OF HONBLE CALCUTTA HIGH COURT IN THE CASE OF CIT VS. VIRGIN CREATORS IN G.A . NMO.3200/2011 DATED 23-11-2011 WHICH HAS BEEN SUBSEQUENTLY FOLLOW ED BY THE AHMEDABAD BENCH OF ITAT IN THE CASE OF ALPHA PROJEC TS SOCIETY LTD., IN ITA NO.2869/AHD/2011. HE THEREFORE, URGED THAT T HE ASSESSEE BE ALLOWED THE DEDUCTION. 7. THE LD. D.R. ON THE OTHER HAND RELIED ON THE OR DER OF THE A.O. 8. WE HAVE HEARD THE CONTENTIONS OF LD. D.R. AND P ERUSED THE MATERIAL ON RECORD. THE UNDISPUTED FACT IN THE CASE IS THAT TDS HAS BEEN DEDUCTED BEFORE THE YEAR END BUT HAS BEEN PAID AFTER THE YEAR ITA NO.1 67/AHD/2010 ASSESSME NT YEAR 2006- 07 . 4 END BUT BEFORE THE FILING OF THE RETURN. IN THE CAS E OF ALPHA PROJECTS SOCIETY LTD. VS. DCIT (SUPRA), THE CO-ORDINATE BENC H RELYING ON THE DECISION OF CALCUTTA HIGH COURT IN THE CASE OF CIT VS. VIRGIN CREATORS (SUPRA) HAS HELD THAT AMENDMENT TO SECTION 40(A)(IA ) IS PROSPECTIVE IN NATURE. FOLLOWING THE AFORESAID DECISION OF THE CO -ORDINATE BENCH, WE ARE OF THE CONSIDERED VIEW THAT SINCE THE ASSES SEE HAS MADE THE PAYMENTS OF TDS BEFORE THE FILING OF RETURN, THE AS SESSEE SHOULD BE ALLOWED DEDUCTION. A.O. IS DIRECTED TO GIVE RELIEF AND DELETE THE ADDITION MADE U/S. 40(A) (IA) OF THE ACT. 9. IN THE RESULT, ASSESSEES APPEAL IS ALLOWED. ORDER PRONOUNCED IN OPEN COURT ON 25 -5- 2012. SD/- SD/- (G.C.GUPTA) (ANIL CHATURVEDI) VICE PRESIDENT ACCOUNTANT MEMBER AHMEDABAD. S.A.PATKI. COPY OF THE ORDER FORWARDED TO: - 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE CIT (APPEALS) XV,AHMEDABAD. 4. THE CIT CONCERNED. 5. THE DR., ITAT, AHMEDABAD. 6. GUARD FILE. BY ORDER DEPUTY/ASSTT.REGISTRAR ITAT,AHMEDABAD. ITA NO.1 67/AHD/2010 ASSESSME NT YEAR 2006- 07 . 5 1.DATE OF DICTATION 16 - 5 -2012 2.DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE TH E DICTATING 17 / 5 / 2012 MEMBER.OTHER MEMBER. 3.DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR. P.S./P.S 18 - 5 -2012. 4.DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE DICTATING MEMBER FOR PRONOUNCEMENT 25 - 5 -2012 5.DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR .P.S./P.S 25 - 5 -2012 6.DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 2 8 - 5 -2012. 7.DATE ON WHICH THE FILE GOES TO THE HEAD CLERK . 8.THE DATE ON WHICH THE FILE GOES TO THE ASSTT. REG ISTRAR FOR SIGNATURE ON THE ORDER 9.DATE OF DESPATCH OF THE ORDER..