ITO WD 22(2)-2, NAVI MUMBAI V. SHIV ROADWAYS, MUMBAI

ITA 5219/MUM/2011

• Counselvise Citation: [2012] 119 COUNSELVISE.COM (IT) 9024 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 2 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-09-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: E
• Next Hearing Date: 11-09-2012
• Assessment Year: 2007-2008
• Appeal Filed On: 08-07-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: V KRISHNAMOORTHY
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES E, MUMBAI BEFORE SHRI DINESH KUMAR AGARWAL (J.M.) AND SHRI N.K. BILLAIYA (A.M.) ITA NO. 5219/MUM /2011 ASSESSMENT YEAR : 2007-08 ITO, WARD 22(2)-2, VASHI RLY. STATION COMPLEX, TOWER NO. 6, 4 TH FLOOR, VASHI, NAVI MUMBAI. VS. M/S SHIV ROADWAYS, 41/A, KURLA KAMGAR CHS, S.G. BARVE MARG, KURLA EAST, MUMBAI 400 024. PAN AAAFS5845H (APPELLANT) (RESPONDENT) DEPARTMENT BY : SHRI V. KRISHNAMOORTHY ASSESSEE BY : NONE DATE OF HEARING 11-9-2012 DATE OF PRONOUNCEMENT 14-9-2012 O R D E R PER DINESH KUMAR AGARWAL, J.M. THIS APPEAL PREFERRED BY THE REVENUE IS DIRECTED A GAINST THE ORDER DTD. 20-4-2011 PASSED BY THE LD. CIT(A) 33, MUMBA I FOR THE A.Y. 2007- 08. 2. AT THE TIME OF HEARING, NONE ATTENDED ON BEHALF OF THE ASSESSEE NOR FILED ANY APPLICATION FOR THE ADJOURNMENT OF THE CA SE, THEREFORE, IT WAS DECIDED TO DISPOSE OF THE APPEAL EX PARTE QUA THE A SSESSEE, ON MERITS, AFTER HEARING THE LD. D.R. ITA NO. 5219/MUM/2011 2 3. BRIEFLY STATED FACTS OF THE CASE ARE THAT THE AS SESSEE FIRM IS ENGAGED IN THE BUSINESS OF TRANSPORT AND COMMISSION . DURING THE COURSE OF ASSESSMENT PROCEEDING IT WAS INTER ALIA O BSERVED BY THE A.O. THAT THE ASSESSEE HAS DEDUCTED TDS ON THE TRUCK CH ARGES PAID OF RS. 1,26,71,091/- AT A RATE OF 1.12%. THE TOTAL TDS OF RS. 1,88,832/- DEDUCTED AND DEPOSITED IN GOVT. ACCOUNT. OUT OF TH AT, THE TDS OF RS. 91,832/- WAS DEPOSITED IN GOVT. ACCOUNT WITHIN THE PRESCRIBED TIME. THE CORRESPONDING EXPENSES FOR THE SAME WORKS OUT TO RS . 61,62,152/- WHICH ARE ALLOWABLE EXPENSES. ON VERIFICATION OF DETAILS IT IS FOUND THAT TOTAL PAYMENT FOR TRUCK HIRE CHARGES FOR THE MONTH OF MAR CH, 2007 IS RS. 7,74,558/-. THE BALANCE EXPENSES OF RS. 57,34,381/ - ON WHICH TDS IS DEPOSITED AFTER THE DUE DATE AS PER PROVISIONS OF S ECTION 194(C) OF I.T. ACT. HENCE, THE EXPENDITURE ON ACCOUNT OF TRUCK/TANKER C HARGES PAID OF RS. 57,34,381/- IS DISALLOWED U/S 40(A)(IA) OF THE INCO ME TAX ACT AND ADDED BACK TO THE INCOME OF THE ASSESSEE. ACCORDINGLY TH E ASSESSMENT WAS COMPLETED AT AN INCOME OF RS. 58,77,240/- VIDE ORDE R DTD. 29-12-2009 PASSED U/S 143(3) OF THE INCOME TAX ACT, 1961 (THE ACT). ON APPEAL THE LD. CIT (A) FOLLOWING THE DECISION OF THE TRIBUNAL IN BALSAL PARIVAHAN (INDIA) (P) LTD. VS. ITO (2011) 43 SOT 619 (MUM) WH EREIN IT HAS BEEN HELD THAT SECTION 40(A)(IA) IS RETROSPECTIVE W.E.F. 1-4- 2005. IT WAS FURTHER HELD THAT IF THE ASSESSEE HAD PAID THE AMOUNT OF TDS BEF ORE THE DUE DATE OF FILING OF RETURN U/S 139(1), THE AMOUNT IS ALLOWABL E. ACCORDINGLY THE LD. CIT(A) DIRECTED THE A.O. TO ALLOW THE SAME AFTER VE RIFICATION. ITA NO. 5219/MUM/2011 3 4. BEING AGGRIEVED BY THE ORDER OF THE LD. CIT(A) T HE REVENUE IS IN APPEAL BEFORE US TAKING FOLLOWING GROUNDS OF APPEAL :- 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, AND IN LAW, THE LD. COMMISSIONER OF INCOME TAX (APPEALS) ERRED IN ACCEP TING THE CAUSE CITED BY THE ASSESSEE FOR THE INORDINATE DELAY IN FILING THE APPEAL. 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, AND IN LAW, THE LD. COMMISSIONER OF INCOME TAX (APPEALS) ERRED IN DELET ING THE ADDITIONS OF RS. 57,34,381/- MADE U/S 40(A)(IA) ON HIRE CHARGES SINCE THE TDS AMOUNT BEING PAID INTO THE GOVERNMENT TREASURY AFTE R DUE DATE. 3. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, AND IN LAW, THE LD. COMMISSIONER OF INCOME TAX (APPEALS) ERRED IN NOT A PPRECIATING THE FACT THAT THE A.O. HAS RIGHTLY ADDED THE ABOVE AMOUNT SI NCE THE AMENDMENT TO SECTION 40(A)(IA) MADE IN THE FINANCE ACT IS W.E .F. 01/04/2010. 4. THE APPELLANT PRAYS THAT THE ORDER OF THE CIT(A) ON THE ABOVE GROUNDS BE REVERSED AND THAT OF THE ASSESSING OFFIC ER BE RESTORED. 5. AT THE TIME OF HEARING THE LD. D.R. SUPPORTS THE ORDER OF THE A.O. 6. WE HAVE CAREFULLY CONSIDERED THE SUBMISSIONS OF THE LD. D.R. AND PERUSED THE MATERIAL AVAILABLE ON RECORD. IN THE AB SENCE OF ANY CONTRARY MATERIAL PLACED ON RECORD BY THE LD. D.R. AGAINST T HE FINDING OF THE LD. CIT(A), WE ARE INCLINED TO UPHOLD THE FINDING OF TH E LD. CIT(A) IN HOLDING THAT THE DELAY IS CONDONED. THE GROUND TAKN BY THE REVENUE IS, THEREFORE, REJECTED. 7. WE FURTHER FIND THAT THE HONBLE CALCUTTA HIGH C OURT IN CIT VS. VIRGIN CREATIONS IN ITAT NO. 302 OF 2011, GA 3200/2 011 JUDGMENT DTD. 23-11-2011 HAS HELD THAT THE AMENDMENT MADE U/S 40( A)(IA) REQUIRES TO BE TREATED WITH RETROSPECTIVE OPERATION SO THAT REA SONABLE DEDUCTION CAN ITA NO. 5219/MUM/2011 4 BE GIVEN TO THE SECTION AS WELL. RESPECTFULLY FOLL OWING THE ABOVE DECISION AND THE CONSISTENT VIEW OF THE TRIBUNAL, WE DECLINE TO INTERFERE WITH THE ORDER PASSED BY THE LD. CIT(A) IN DIRECTING THE A.O . TO ALLOW THE SAME AFTER DUE VERIFICATION. THE GROUNDS TAKEN BY THE R EVENUE ARE, THEREFORE, REJECTED. 8. IN THE RESULT, REVENUES APPEAL STANDS DISMISSED . ORDER PRONOUNCED ON 14-9-2012. SD/- (N.K. BILLAIYA) ACCOUNTANT MEMBER SD/- (DINESH KUMAR AGARWAL) JUDICIAL MEMBER MUMBAI, DATED : 14-9-2012 RK COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. COMMISSIONER OF INCOME TAX (APPEALS)- 22, MUMBA I 4. COMMISSIONER OF INCOME TAX CENTRAL - 10 MUMBA I 5. DEPARTMENTAL REPRESENTATIVE, BENCH E, MUMBAI //TRUE COPY// BY ORDER ASSTT. REGISTRAR, ITAT, MUMBAI