The ITO, Ward-5(2)(4), Ahmedabad V. M/s. Tejaskumar R. Shah (HUF), Ahmedabad

ITA 3309/AHD/2016

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 8266 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 5 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-05-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: Not Allotted
• Assessment Year: 2012-2013
• Appeal Filed On: 08-12-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: V K SINGH
• Keywords: Retrospective amendment; Corroborative evidences
• Section: 143(3); 194C; 201(1)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD D BENCH BEFORE: SHR I RAJPAL YADAV , JUDICIAL MEMBER AND SHRI AMARJIT SINGH, ACCOUNTANT MEMBER THE ITO, WARD - 5(2)(4), AHMEDABAD (APPELLANT) VS M/S. TEJASKUMAR R. SHAH (HUF), C/O. M/S. KESHTRAPAL EXPORTS, ABOVE GIRISH COLD DRINK, C.G. ROAD, AHMEDABAD PAN: AACHT0093E (RESPONDENT) REVENUE BY : S H RI V .K. SINGH , SR. D . R. ASSESSEE BY: NONE DATE OF HEARING : 20 - 03 - 2 018 DATE OF PRO NOUNCEMENT : 10 - 05 - 2 018 / ORDER P ER : AMARJIT SINGH, ACCOUNTANT MEMBER : - THIS REVENUE S APPEAL FOR A.Y. 2012 - 13 , ARIS ES FROM ORDER OF THE CIT(A) - 5 , AHM EDABAD DATED 21 - 09 - 2016 , IN PROCEEDINGS UNDER SECTION 143(3) OF THE INCOME TAX ACT, 1961; IN SHORT THE ACT . 2. THE REVENUE HAS RAISED FOLLOWING GROUNDS OF APPEAL: - (1) THE LD. CLT(A) HAS ERRED IN LAW AND ON FACTS BY TREATING THE SECOND PROVISO TO SECTION 40(A) (IA) AS CURATIVE IN NATURE AND THEREFORE GIVING RETROSPECTIVE EFFECT. ALTHOUGH THE ID. CLT(A) RELIED UPON JUDGMENT OF HON'BLE DELHI HIGH COURT IN THE CASE OF ANSAL LA NDMARK TOWNSHIP PVT. LTD. 279 CTR 384 (DELHI) IS STILL PENDING BEFORE THE HON'BLE SUPREME COURT. THE ORDER OF THE LD. CLT(A) TO DELETE THE DISALLOWANCE OF RS.66,66,523/ - U/S.40(A) (IA) OF THE ACT AFTER CONSIDERING THE EVIDENCES AS STIPULATED IN PROVISO TO SECTION 201(1) OF THE ACT IS NOT AS PER CORRECT PROVISION OF LAW. I T A NO . 3309 / A HD/20 16 A SSESSMENT YEAR 2012 - 13 I.T.A NO. 3309 /AHD/20 16 A.Y. 2012 - 13 PAGE NO ITO VS. M/S. TEJASKUMAR R. SHAH (HUF) 2 (2) ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. CIT (A) OUGHT TO HAVE UPHELD THE ORDER OF THE ASSESSING OFFICER. (3) IT IS, THEREFORE, PRAYED THAT THE ORDER OF THE LD. C1T (A) MAY BE SET ASIDE AND THE ORDER OF THE ASSESSING OFFICER BE RESTORED TO THE ABOVE EXTENT. 3. THE FACTS IN BRIEF IS THAT DURING THE COURSE OF ASSESSMENT PROCEEDINGS IT WAS DISCERNED TO THE ASSESSING OFFICER THE ASSESSEE HAS MADE PAYMENT OF FREIGHT CHARG ES OF RS. 66 , 66 , 523/ - WITHOUT DEDUCTION OF TDS AS PER PROVISION OF SECTION 194C OF THE ACT . THE ASSESSING OFFICER OBSERVE THAT ASSESSEE HAS PAID ABOVE FREIGHT CHARGES OF RS. 66,66,523/ - ABOVE RS.20000/ TO FIVE DIFFERENT PARTIES WITHOUT DEDUCTION OF TAX IN CONTRAVENTION OF THE PROVISION OF SECTION 194 C OF THE ACT. CONSEQUENTLY , THE ASSESSING OFFICER HAS DISALLOWED THE AMOUNT OF RS . 66 , 66 , 523/ - U/S. 40(A)(IA) OF THE ACT. 4. AGGRIEVED ASSESSEE FILED APPEAL BEFORE THE LD. CIT(A). THE LD. CIT(A) HAS A LLOWED THE APPEAL OF THE ASSESSEE ON THE GROUND THAT THESE PAYMENTS WERE MADE TO THE SHIPPING AGENT TOWARDS FREIGHT CHARGES AND THESE WERE IN THE NATURE OF RE IMBURSEMENT OF EXPENSES FURTHER THE ASSESSEE HAS FURNISHED A CERTIFICATE AS PRESCRIBED IN PROVI SO TO SECTION 201 IN VIEW OF THE AMENDED PROVISION OF SECTION 40(A)(IA) OF THE ACT. 5. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIAL ON RECORD CAREFULLY. ON SCRUTINY, THE ASSESSING OFFICER NOTICED THAT ASSESSEE HAS MADE PAYMENT OF FRE IGHT EXPENSE WITHOUT DEDUCTING T AX AGAINST THE PROVISION OF SECTION 194C OF THE ACT. THEREFORE, TH E ASSESSING OFFICER HAS DISALLOWED FREIGHT PAYMENT AGGREGATING OF R S. 66,66,523/ - U/S. 40(A)(IA) OF THE ACT. DURING THE COURSE OF APPELLATE PROCEEDINGS BEF ORE THE LD. CIT(A), THE ASSESSE H AS FURNISHED CERTIFICATE OF THE TAX PAYMENT BY THE TWO PARTIES REGARDING PAYMENT OF TAXES AS PER 1 ST PROVISO TO SUB - SECTION (1) OF SECTION 201 OF THE ACT. THE CIT(A) HAS DIRECTED THE ASSESSING OFFICER TO DELETE THE DISALLO WANCE MADE U/S. 40(A)(IA) AFTER I.T.A NO. 3309 /AHD/20 16 A.Y. 2012 - 13 PAGE NO ITO VS. M/S. TEJASKUMAR R. SHAH (HUF) 3 CONSIDERING THE SECOND PROV IS O TO THAT SECTION. THE LD. CIT(A) HAS PLACED RELIANCE ON THE FOLLOWING JUDICIAL PRONOUNCEMENTS . 1. COMMISSIONER OF INCOME - TAX VS. ANSAL LAND MARK TO279 CTR 0384 (DELHI HIGH COURT) 2. ITAT, AHMEDABAD BENCH DIPAK R. GONDALIYA VS. ITO (ITA NO. 3313 & 3314/AHD/2015 3. ITAT, AHMEDABAD BENCH M/S.MITRATA CONSTRUCTION VS. ACIT ITA NO. 1989/AHD/2013 AFTER CONSIDERING THE ABOVE FACTS AND THE JUDICIAL FINDINGS, WE ARE INCLINED WITH THE FIN DINGS OF THE LD. CIT(A). WE CONSIDER THAT IN VIEW OF THE PROVISION OF SECTION 40(A)(IA) BY THE FINANCE ACT 2012 AS PER WHICH THE 2 ND PROVISO OF ITS SUB - SECTION INTRODUCED IN THE ACT, NO DISALLOWANCE U/S. 40(A) SHOULD BE MADE IN CASE THE PAYEE HAS PAID THE TAX. THE ASSESSEE HAS FURNISHED THE SUPPORTING EVIDENCES DEMONSTRATING THAT TAXES HAVE BEEN PAID BY THE PARTIES TO WHOM THE ASSESSEE HAS MADE FREIGHT PAYMENT. AFTER CONSIDERING THE JUDICIAL PRONOUNCEMENTS OF THE CO - ORDINATE BENCHES OF THE ITAT, WE ARE I NCLINED WITH THE DECISION OF THE LD. CIT(A) THAT SECOND PROVISO TO SECTION 40(A)(IA) IS CURATIVE IN NATURE AND HAS BEEN HELD TO BE RETROSPECTIVE IN NATURE. IN VIEW OF THE ABOVE FACTS AND JUDICIAL FINDINGS, WE DO NOT FIND ANY ERROR IN THE DECISION OF THE L D. CIT(A). ACCORDINGLY, THE APPEAL OF THE REVENUE IS DISMISSED. 6. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISMISSED. ORDER PR ONOUNCED IN THE OPEN C OURT ON 10 - 05 - 201 8 SD/ - SD/ - ( RAJPAL YADAV ) ( AMARJIT SINGH ) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD : DATED 10 /05 /2018 / COPY OF ORDER FORWARDED TO: - 1. ASSESSEE 2. REVENUE 3. CONCERNED CIT 4. CIT (A) 5. DR, ITAT, AHMEDABAD 6. GUARD FILE. I.T.A NO. 3309 /AHD/20 16 A.Y. 2012 - 13 PAGE NO ITO VS. M/S. TEJASKUMAR R. SHAH (HUF) 4 BY ORD ER/ , / ,