M/s. Vission Construction, SILVASSA V. The Income Tax Officer, Vapi Ward-3, Vapi

ITA 1865/AHD/2013

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 0779 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 1 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-08-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 02-08-2016
• Assessment Year: 2006-2007
• Appeal Filed On: 28-06-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SATISH SOLANKI HEARING CONCLUD
• Keywords: Retrospective amendment
• Section: 143(3)

Judgement Text

I.T.A. NO.: 1865/AHD/2013 ASSESSMENT YEAR: 2006 - 07 PAGE 1 OF 4 IN THE INCOME TAX APPELLATE TRIBUNAL, AHMEDABAD SMC BENCH, AHMEDABAD [CORAM : PRAMOD KUMAR AM ] I.T.A. NO. : 1865/AHD/2013 ASSESSMENT YEAR: 2006 - 07 VISSION CONSTRUCTION ... ....APPELLANT [PAN: AADFV0387J ] VS INCOME TAX OFFICER WARD 3, VAPI ....... ....RESPONDENT APPEARANCES BY KAMLESH BHATT FOR THE APPELLANT SATISH SOLANKI FOR THE RESPONDENT HEARING CONCLUDED ON: 0 2 /0 8 /16 ORDER PRONOUNCED ON : 16 /08/16 O R D E R 1. THIS APPEAL, FILED BY THE ASSESSEE, IS DIRECTED AGAINST THE ORDE R DATED 31 ST MARCH 2013 PASSED BY THE CIT(A), IN THE MATTER OF ASSESSMENT UNDER SECTION 143(3) OF THE INCOME TAX ACT, 1961, FOR THE ASSESSMENT YEAR 2006 - 07 . 2. IN THE COURSE OF SCRUTINY ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER HAD MADE A DISALLOWANCE OF RS 11,89,049 UNDER SECTION 40(A)(IA) OF THE ACT ON THE GROUND THAT THERE WAS A DELAY IN DEPOSITING THE TAX DEDUCTED AT SOURCE. THE TAXES WHICH SHOULD HAVE BEEN DEPOSITED BY 31 ST MARCH 2006, I.E. THE END OF THE RELEVANT PREVIOUS YEAR, WERE INFACT DEPOSI TED ON 6 TH APRIL 2006. THE ASSESSMENT ORDER SO MAKING THE DISALLOWANCE UNDER SECTION 40(A)(IA) WA S SERVED ON THE ASSESSEE ON 27 TH NOVEMBER 2008 BUT IT WAS ONLY ON 16 TH APRIL 2011 THAT A REVISION PETITION WAS FILED BEFORE THE CIT, BUT, ON 10 TH OCTOBER 2011, THIS REVISION PETITION WAS WITHDRAWN, AND I.T.A. NO.: 1865/AHD/2013 ASSESSMENT YEAR: 2006 - 07 PAGE 2 OF 4 SHORTLY THEREAFTER, NON 3 RD NOVEMBER 2011, THE APPEAL WAS FILED BEFORE THE CIT(A). LEARNED CIT(A) DECLINED TO CONDONE THE DELAY, AGGRIEVED BY WHICH THE ASSESSEE IS IN APPEAL BEFORE ME. 3. I HAVE HEARD THE RIVAL CONTENTIONS, PERUSED THE MATERIAL ON RECORD AND DULY CONSIDERED FACTS OF THE CASE IN THE LIGHT OF THE APPLICABLE LEGAL POSITION. 4. I HAVE NOTED THAT THERE IS INDEED THE ASSESSEE SHOULD HAVE FILED THE APPEAL BY 27 TH JANUARY 2009 BUT HE DID SEEK THE LEGAL REMEDY, AGAINST THE DISALLOWANCE, FOR THE FIRST TIME ON 16 TH APRIL 2011 BY SEEKING REVISION UNDER SECTION 264. EVEN THIS REVISION PETITION WAS LATER WITHDRAWN AND THE ASSESSEE THEN FILED THE APPEAL BEFORE THE CIT(A) SHORTLY AFTER THE WITHDRAWAL. SO FAR AS THE PERIOD AFTER 16 TH APRIL 2011 IS CONCERNED, THE DELAY IS REASONABLY EXPLAINED BY THE FACT THAT AN ALTERNATIVE REMEDY, WHICH ESSENTIALLY REQUIRES MUCH GREATER CONFIDENCE OF THE TAXPAYERS IN THE TAX ADMINISTRATION THAN THE DEGREE OF SUCH CONFIDENCE AS IT EXISTS, WAS BEING PURSUED. IN MY CONSIDERED OPINION, A MERE EXERCISE SWAP OF OPTIONS, IN AVAILABLE REMEDIES, CAN INDEED BE TREATED AS A REASONABLE GROUND FOR CONDONATION OF DELAY. THE QUESTION REALLY IS WHETHER THIS DELAY BETWEEN 27 TH JANUARY 20 09 TO 16 TH APRIL 2011 SHOULD HAVE BEEN CONDONED BY THE LEARNED COMMISSIONER (APPEALS) OR NOT. AS I EXAMINE THIS ASPECT OF THE MATTER, IT IS ESSENTIAL TO BEAR IN MIND SECTION 40(A)(IA) WHICH IS OFTEN DESCRIBED AS A RATHER DRASTIC PROVISION WAS SUBJECTED TO QUITE A FEW AMENDMENTS, MANY OF WHICH WERE RETROSPECTIVE AND MANY OF WHICH HELD TO BE RETROSPECTIVE BY THIS TRIBUNAL AS INDEED BY HON BLE COURTS ABOVE, FROM TIME TO TIME. AS A MATTER OF FACT, FINANCE ACT 2010 ITSELF MADE A RETROSPECTIVE AMENDMENT W.E.F. 1 ST APRIL 20 10 BY AMENDING FIRST PROVISO TO SECTION 40(A)(IA). IT WAS LITTLE LATER, HOWEVER, THAT THERE WERE STREAM OF DECISIONS BY THE JUDICIAL AUTHORITIES THAT THIS AMENDMENT WAS RETROSPECTIVE EFFECTIVE FROM THE DATE ON WHICH THE SECTION 40(A)(IA) ITSELF WAS INTRODU CED. AS ON THE POINT OF TIME WHEN THE ASSESSEE WAS TO FILE THE APPEAL I.E. 27 TH JANUARY 2009, THE LEGAL POSITION WAS AGAINST THE ASSESSEE. THE AMENDMENT WAS MADE IN MID 2010 AND THEN ALSO IT WAS MUCH LESS THAN CRYSTAL CLEAR THAT SUCH AN AMENDMENT WILL AFFE CT THE I.T.A. NO.: 1865/AHD/2013 ASSESSMENT YEAR: 2006 - 07 PAGE 3 OF 4 POSITION OF THE ASSESSEE WHICH WAS DEALIN G WITH ASSESSMENT YEAR 2006 - 07. WHEN THE LEGAL POSITION WAS SO FLUID, WHEN THE LEGISLATURE ITSELF WAS GRANTING RELIEF BY GIVING RETROSPECTIVE AMENDMENTS AND WHEN HON BLE COURTS AND TRIBUNALS WERE TIME AND AGA IN HOLDING THE PROVISIONS TO BE IN THE NATURE OF PROVISIONS GRANTING RELIEF FOR UNINTENDED CONSEQUENCES OF SECTION 40(A)(IA), AN ASSESSEE CANNOT BE HELD TO BE AT FAULT IN FILING DELAYED APPEALS. NONE CAN BE EXPECTED TO HAVE THE CLAIRVOYANCE OF KNOWING AS T O WHAT STATUTORY AMENDMENTS WILL BE INTRODUCED BY THE LEGISLATURE AND WHETHER THESE AMENDMENTS WILL BE HELD TO COMPLETELY RETROSPECTIVE IN NATURE. THE ASSESSEE IS A SMALL TIME ASSESSEE, AND, UNLIKE BIG CORPORATES, IT MAY NOT EVEN HAVE THE BENEFIT OF RIGHT LEGAL ADVICE AT ALL TIMES. THE MAZE OF AMENDMENTS IN SECTION 40(A)(IA) AND TWISTS AND TURNS IN LEGAL INTERPRETATIONS OF THESE AMENDMENTS LEAVE EVEN TODAY AND EVEN SEASONED PROFESSIONAL BAFFLED. THE CONFUSION ABOUT THE LEGAL IMPACT OF THESE AMENDMENTS, AT T HE RELEVANT POINT OF TIME, IS COMPLETELY UNDERSTANDABLE. IN ANY EVENT, WHEN LEGISLATURE ITSELF IS RELAXING THE RIGOUR OF LAW WITH RETROSPECTIVE EFFECT, THE ASSESSEE CANNOT BE FAULTED FOR AVAILING SUCH RELAXATIONS. IN THESE CIRCUMSTANCES, THE DELAY IN FILIN G OF APPEAL IS QUITE UNDERSTANDABLE AND DESERVES TO BE CONDONED. THE LAW, PARTICULARLY PROCEDURAL LAW, SHOULD BE IMPLEMENTED WITH SOME DEGREE OF COMPASSION AND CONCERN FOR THE GENUINE TAXPAYERS - PARTICULARLY WHEN THE POINT OF DISPUTE ITSELF IS A PROCEDURAL ASPECT. AS HELD BY HON BLE SUPREME COURT IN THE CASE OF COLLECTOR LAND ACQUISITION VS MST KATIJI [ (1987) 167 ITR 471 (SC)] THERE IS NO PRESUMPTION THAT DELAY IS OCCASIONED DELIBERATELY, OR ON ACCOUNT OF CULPABLE NEGLIGENCE, OR ON ACCOUNT OF MALA FIDES. A LITIGANT DOES NOT STAND TO BENEFIT BY RESORTING TO DELAY. IN FACT, HE RUNS A SERIOUS RISK. IT MUST BE GRASPED THAT THE JUDICIARY IS RESPECTED NOT ON ACCOUNT OF ITS POWER TO LEGALIZE INJUSTICE ON TECHNICAL GROUNDS BUT BECAUSE IT IS CAPABLE OF REMOVING INJU STICE AND IS EXPECTED TO DO SO . VIEWED IN THIS PERSPECTIVE, I AM INCLINED TO CONDONE THE DELAY AND REMIT THE MATTER TO THE FILE OF LEARNED CIT(A) FOR ADJUDICATION ON MERITS. I DIRECT SO. I.T.A. NO.: 1865/AHD/2013 ASSESSMENT YEAR: 2006 - 07 PAGE 4 OF 4 7 . IN THE RESULT, T HE APPEAL IS ALLOWED FOR STATISTICAL PURPOSES IN THE TERMS INDICATED ABOVE . PRONOUNCED IN THE OPEN COURT TODAY ON 16 TH DAY OF AUGUST, 2016. SD/ - PRAMOD KUMAR (ACCOUNTANT MEMBER) DATED: 16 TH DAY OF AUGUST ,2016 . COPIES TO : (1) THE APPELLANT (2) THE RESPONDENT (3) CIT (4) CIT(A) (5) DR (6) GUARD FILE BY ORDER ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCHES, AHMEDABAD