ITO, Ward 3(1), Pune V. Shraddha & S.S. Kale Joint Venture, Pune

ITA 2561/PUN/2012

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 76080 (ITAT-PUNE)
• Duration Of Justice: 1 year(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-01-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2009-2010
• Appeal Filed On: 27-12-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S P WALIMBE
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCHES B, PUNE BEFORE SHRI G.S. PANNU, ACCOUNTANT MEMBER AND SHRI R.S. PADVEKAR, JUDICIAL MEMBER ITA NO. 2561/PN/2012 (ASSESSMENT YEAR : 2009-10) INCOME TAX OFFICER, WARD 3(1), PUNE. . APPELLANT VS. SHRADDHA & S.S. KALE JOINT VENTURE, CTS NO. 1206A-1, SHRADDHA HOUSE, SHIROLE ROAD, PUNE 411 004. PAN : AADAS7271F . RESPONDENT DEPARTMENT BY : SHRI S.P. WALIMBE ASSESSEE BY : SHRI SUNIL GANOO DATE OF HEARING : 15-01-2014 DATE OF PRONOUNCEMENT : 16-01-2014 ORDER PER G. S. PANNU, AM THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST AN ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS)-II, PUNE DATED 31.08.2012 WHICH, IN TURN, HAS ARISEN FROM AN ORDER DATED 22.12.2011 PAS SED BY THE ASSESSING OFFICER, U/S 143(3) OF THE INCOME-TAX ACT, 1961 (IN SHORT THE ACT), PERTAINING TO THE ASSESSMENT YEAR 2009-10. 2. IN THIS APPEAL, THE ONLY GRIEVANCE OF THE REVENU E IS AGAINST THE DECISION OF THE CIT(A) IN DELETING AN ADDITION OF RS.1,76,53 ,779/- MADE BY THE ASSESSING OFFICER BY INVOKING SECTION 40(A)(IA) OF THE ACT. 3. IN BRIEF, THE FACTS RELEVANT TO THE AFORESAID CO NTROVERSY ARE AS FOLLOWS. THE RESPONDENT-ASSESSEE IS ENGAGED IN THE BUSINESS OF CONTRACTING AND IT HAD INCURRED AN EXPENDITURE OF RS.1,76,53,779/- ON ACCO UNT OF SUB-CONTRACT CHARGES FOR WHICH THE TAX DEDUCTED AT SOURCE I.E. T DS OF RS.2,00,017/- WAS TO BE DEPOSITED WITH THE STATE-EXCHEQUER ON OR BEFORE THE LAST DAY OF THE PREVIOUS ITA NO. 2561/PN/2012 A.Y. 2009-10 YEAR I.E. 31.03.2009 BUT THE SAME WAS DEPOSITED ON 20.04.2009. ACCORDING TO THE ASSESSING OFFICER, BECAUSE OF THE AFORESAID, AS SESSEE VIOLATED THE PROVISIONS OF CHAPTER XVII-B AND THEREFORE THE EXPE NDITURE OF RS.1,76,53,779/- WAS DISALLOWABLE IN TERMS OF SECTION 40(A)(IA) OF T HE ACT. THE CIT(A) HELD THAT NO DISALLOWANCE U/S 40(A)(IA) OF THE ACT IS CALLED FOR IN THE LIGHT OF THE AMENDMENT MADE BY THE FINANCE ACT, 2010 WHICH WAS T O BE UNDERSTOOD AS RETROSPECTIVE IN OPERATION FOLLOWING THE DECISION O F THE PUNE BENCH OF THE TRIBUNAL IN THE CASE OF ITO VS. SHRI MATA TULSOMAL PREMCHAND IN ITA NO.713/PN/2011 DATED 21.06.2012 WHEREIN THE TRIBUNA L HAD FOLLOWED THE JUDGMENT OF THE HONBLE CALCUTTA HIGH COURT IN THE CASE OF CIT VS. VIRGIN CREATIONS IN ITA NO.302 OF 2011 GA 3200 OF 2011 DAT ED 23.11.2011. AGAINST THE AFORESAID ORDER OF THE CIT(A), REVENUE IS IN AP PEAL BEFORE US. 4. BEFORE US, THE LEARNED DEPARTMENTAL REPRESENTATI VE HAS REITERATED THE STAND OF THE ASSESSING OFFICER WHICH WE HAVE ALREAD Y NOTED IN THE EARLIER PARAGRAPH AND IS NOT BEING REPEATED FOR THE SAKE OF BREVITY. 5. ON THE OTHER HAND, LEARNED REPRESENTATIVE FOR TH E RESPONDENT- ASSESSEE POINTED OUT THAT THE PUNE BENCH OF THE TRI BUNAL HAS FOLLOWED THE JUDGMENT OF THE HONBLE CALCUTTA HIGH COURT IN THE CASE OF VIRGIN CREATIONS (SUPRA) EVEN SUBSEQUENTLY IN THE CASE OF ACIT, CIR. 9, PUNE VS. H.A. DEVELOPERS IN ITA NO.373/PN/2009 DATED 27.04.2012. 6. WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISSIO NS. OSTENSIBLY, THE PROVISIONS OF SECTION 40(A)(IA) HAVE BEEN INVOKED B Y THE ASSESSING OFFICER TO DISALLOW AN EXPENDITURE INCURRED DURING THE YEAR UN DER CONSIDERATION BECAUSE AS PER THE ASSESSING OFFICER, THE CORRESPONDING TDS HAS NOT BEEN DEPOSITED BY THE ASSESSEE BEFORE 31.03.2009 WHEREAS THE SAME WAS DEPOSITED ON 20.04.2009. THE PLEA OF THE ASSESSEE IS THAT THE T DS HAS BEEN DEPOSITED WITH THE STATE-EXCHEQUER MUCH BEFORE THE DUE DATE O F FILING OF RETURN OF INCOME ITA NO. 2561/PN/2012 A.Y. 2009-10 PRESCRIBED IN SECTION 139(1) OF THE ACT AND THEREFO RE, CONSIDERING THE AMENDMENT MADE IN SECTION 40(A)(IA) OF THE ACT BY T HE FINANCE ACT, 2010, WHICH IS RETROSPECTIVE IN ITS OPERATION SO AS TO BE AVAILABLE TO THE ASSESSEE EVEN FOR THE ASSESSMENT YEAR UNDER CONSIDERATION, A NY PAYMENT OF TAX DEDUCTED DURING THE PREVIOUS YEAR CAN BE MADE TO TH E STATE-EXCHEQUER ON OR BEFORE THE DUE DATE OF FILING OF RETURN OF INCOME P RESCRIBED U/S 139(1) OF THE ACT. IF THE PAYMENT IS SO MADE, THE CORRESPONDING EXPENDITURE CANNOT INVITE THE DISALLOWANCE U/S 40(A)(IA) OF THE ACT. IN OUR CONSIDERED OPINION, THE POINT CANVASSED BY THE ASSESSEE AND WHICH HAS ALSO BEEN A CCEPTED BY THE CIT(A), IS IN LINE WITH THE JUDGMENT OF THE HONBLE CALCUTT A HIGH COURT IN THE CASE OF VIRGIN CREATIONS (SUPRA) WHEREIN AN IDENTICAL CONTR OVERSY HAS BEEN CONSIDERED. AS PER THE HONBLE HIGH COURT, AMENDME NT MADE TO SECTION 40(A)(IA) OF THE ACT BY THE FINANCE ACT, 2010 IS RE TROSPECTIVE IN OPERATION AND CONSIDERED IN THE SAID LIGHT, IN THE PRESENT CASE A SSESSEE HAS DEPOSITED THE TDS ON OR BEFORE THE DUE DATE OF FILING OF RETURN O F INCOME PRESCRIBED U/S 139(1) OF THE ACT AND THEREFORE, THE ASSESSING OFFI CER WAS NOT JUSTIFIED IN DISALLOWING THE CORRESPONDING EXPENDITURE U/S 40(A) (IA) OF THE ACT. IN THIS MANNER, WE DEEM IT FIT AND PROPER TO AFFIRM THE ORD ER OF THE CIT(A), WHICH HAS BEEN RENDERED FOLLOWING THE JUDGMENT OF THE HONBLE CALCUTTA HIGH COURT IN THE CASE OF VIRGIN CREATIONS (SUPRA), AND NO CONTRA RY DECISION OF ANY OTHER HIGH COURT HAS BEEN BROUGHT TO OUR NOTICE. THUS, T HE ORDER OF THE CIT(A) IS HEREBY AFFIRMED. 7. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSE D. ORDER PRONOUNCED IN THE OPEN COURT ON 16 TH JANUARY, 2014. SD/- SD/- (R.S. PADVEKAR) (G.S. PANNU) JUDICIAL MEMBER ACCOUNTANT MEMBER PUNE, DATED: 16 TH JANUARY, 2014. SUJEET ITA NO. 2561/PN/2012 A.Y. 2009-10 COPY OF THE ORDER IS FORWARDED TO : - 1) THE ASSESSEE; 2) THE DEPARTMENT; 3) THE CIT(A)-II, PUNE; 4) THE CIT-II, PUNE; 5) THE DR, B BENCH, I.T.A.T., PUNE; 6) GUARD FILE. BY ORDER //TRUE COPY// SR. PRIVATE SECRETARY I.T.A.T., PUNE