M/s. Siddi Vinayak Sarees, Kolkata V. ITO, Ward - 45(3), , Kolkata

ITA 2056/KOL/2018

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 9322 (ITAT-KOLKATA)
• Duration Of Justice: 6 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-04-2019
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Assessment Year: 2006-2007
• Appeal Filed On: 01-10-2018
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: RAJA SENGUPTA
• Assessee Lawyers: S M SURANA
• Keywords: Retrospective amendment; TDS
• Section: 40(a)(ia)

Judgement Text

1 ITA NO.2056/KOL/2018 M/S. SIDDI VINA YAK SAREES, AY:2006-07 , B (SMC) , IN THE INCOME TAX APPELLATE TRIBUNAL B(SMC) BENCH : KOLKATA ( ) . . , ) [BEFORE SHRI A. T. VARKEY, JM] I.T.A. NO. 2056/KOL/2018 ASSESSMENT YEAR: 2006-07 M/S. SIDDI VINAYAK SAREES (PAN: AATFS6588A) VS. INCOME-TAX OFFICER, WD-45(3), KOLKATA APPELLANT RESPONDENT DATE OF HEARING 30.01.2019 DATE OF PRONOUNCEMENT 03.04.2019 FOR THE APPELLANT SHRI S. M. SURANA, ADVOCATE FOR THE RESPONDENT SHRI RAJA SENGUPTA, JCIT, SR. DR ORDER PER SHRI A.T.VARKEY, JM THIS APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF LD. CIT(A)-13, KOLKATA DATED 16.08.2018 FOR AY 2006-07. 2. THE MAIN GRIEVANCE OF THE ASSESSEE IN THIS APP EAL IS AGAINST THE ACTION OF LD. CIT(A) IN CONFIRMING THE ACTION OF THE AO IN DISALLOWING A SUM OF RS.8,96,450/- U/S. 40(A)(IA) OF THE INCOME-TAX ACT, 1961 (HEREINAFTER REFERRED TO A S THE ACT). 3. AT THE OUTSET ITSELF, THE LD. COUNSEL FOR THE AS SESSEE DREW OUR ATTENTION TO GROUND NO.2 OF THIS APPEAL, WHICH IS AS UNDER: 2 ITA NO.2056/KOL/2018 M/S. SIDDI VINA YAK SAREES, AY:2006-07 2. FOR THAT EVEN OTHERWISE THE DISALLOWANCE U/S. 40(A)(IA) SHOULD HAVE BEEN RESTRICTED TO 30% SINCE THE AMENDMENT TO THE SECTION WAS APPLICAB LE WITH RETROSPECTIVE EFFECT. 4. ACCORDING TO LD. AR, 30% OF THE DISALLOWANCE MA Y BE SUSTAINED IN VIEW OF THE AMENDMENT BROUGHT IN BY FINANCE ACT NO. 2 W.E.F. 01 .04.2015 TO SECTION 40(A)(IA) OF THE ACT WHICH HAS BEEN HELD TO BE CURATIVE IN NATURE AN D HENCE, RETROSPECTIVE BY THE COORDINATE BENCH OF THIS TRIBUNAL, CHANDIGARH BENCH IN THE CAS E OF DCIT VS. PUNJAB INFRASTRUCTURE & DEVELOPMENT BOARD LTD., ITA NO. 774/CHD/2013 DATED 30.09.2015. THE LD. DR OBJECTED TO THE RELIEF PRAYED BY THE ASSESSEE, AND ACCORDING TO HIM, THE AMENDMENT IS ONLY W.E.F. 01.04.2015 AND CAN BE ONLY PROSPECTIVE AND, THEREFO RE, THE DISALLOWANCE SHOULD BE SUSTAINED. 5. HAVING HEARD THE RIVAL SUBMISSIONS AND GONE THRO UGH THE FACTS AND CIRCUMSTANCES OF THE CASE IT IS NOTED THAT PURSUANT TO THE TRIBUNAL S DIRECTION THE AO AFTER EXAMINING THE VERACITY OF THE VOUCHERS SUBMITTED BY THE ASSESSEE AGAINST THE PAYMENTS MADE TO VARIOUS PERSONS FOUND OUT THAT PAYMENTS HAVE BEEN MADE WITH OUT DEDUCTING TDS AND HAS FOUND THAT THERE IS NO CREDENCE OF THE VOUCHERS PRODUCED BY TH E ASSESSEE SO, HE DISALLOWED THE EXPENDITURE CLAIMED TO THE TUNE OF RS.8,96,450/- BY INVOKING SECTION 40(A)(IA) OF THE ACT. ON APPEAL, THE LD. CIT(A) CONFIRMED THE ORDER OF TH E AO. BEFORE US, THE LD. AR TAKING NOTE OF THE AMENDMENT BROUGHT IN BY THE FINANCE ACT NO. 2 W.E.F. 01.04.2015 TO SEC. 40(A)(IA) OF THE ACT PRAYED THAT 30% OF THE DISALLO WANCE MAY BE SUSTAINED AND THUS PARTIAL RELIEF MAY BE GRANTED TO THE ASSESSEE. IT HAS BEEN BROUGHT TO MY NOTICE THAT THE ITAT CHANDIGARH BENCH HAS HELD IN THE CASE OF PUNJAB IN FRASTRUCTURE & DEVELOPMENT BOARD LTD. (SUPRA) THAT THOUGH THE AFORESAID AMENDMENT HAS BEE N BROUGHT W.E.F. 01.04.2015 IT IS CURATIVE IN NATURE AND SO RETROSPECTIVE IN OPERATIO N AND SO FOLLOWING THE RATIO LAID BY THE COORDINATE BENCH OF THIS TRIBUNAL, I AM INCLINED TO ALLOW THE SAID PRAYER OF THE LD. AR OF THE ASSESSEE, THEREFORE, I RESTRICT THE DISALLOWANC E TO 30% OF RS. 8,96,450/-. THE AO IS DIRECTED TO GIVE RELIEF IN ACCORDANCE TO LAW AS PER THE AFORESAID DIRECTION. 3 ITA NO.2056/KOL/2018 M/S. SIDDI VINA YAK SAREES, AY:2006-07 6. THE LAST GROUND IS GENERAL IN NATURE AND THEREFO RE, NO ADJUDICATION IS REQUIRED AND, HENCE, THE SAME IS DISMISSED. 7. IN THE RESULT, THE APPEAL OF ASSESSEE IS PARTLY ALLOWED. ORDER IS PRONOUNCED IN THE OPEN COURT ON 3RD APRIL, 2019. SD/- (ABY. T. VARKEY) JUDICIAL MEMBER DATED : 3RD APRIL, 2019 JD.(SR.P.S.) COPY OF THE ORDER FORWARDED TO: 1. APPELLANT M/S. SIDDI VINAYAK SAREES, 2 ND FLOOR, 23B, KALAKAR STREET, KOLKATA-700 007. 2 RESPONDENT ITO, WARD-45(3), KOLKATA. 3. 4. CIT(A)-13, KOLKATA(SENT THROUGH E-MAIL) CIT, . KOLKATA. 5. DR, ITAT, KOLKATA. (SENT THROUGH E-MAIL) / TRUE COPY, BY ORDER, ASSISTANT REGISTRAR