ITO 22(2)(1), NAVI MUMBAI V. JAI ROADWAYS, MUMBAI

ITA 5342/MUM/2011

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 62479 (ITAT-MUMBAI)
• Duration Of Justice: 10 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-06-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: J
• Next Hearing Date: 31-05-2012
• Assessment Year: 2007-2008
• Appeal Filed On: 14-07-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: D S SUNDER SINGH
• Assessee Lawyers: DEEPAK S SUKHIJA
• Keywords: Retrospective amendment

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI J BENCH BEFORE SHRI B. RAMAKOTAIAH, ACCOUNTANT MEMBER AND SHRI S.S. GODARA, JUDICIAL MEMBER ITA NO.5342/M/2011 ASSESSMENT YEAR 2007-08 ITO 22(2)(1), R.NO. 419, 4 TH FLOOR, TOWER NO. 6, VASHI RLY. STATION COMPLEX, VASHI, NAVI MUMBAI 400 705. .......... APPELLANT VS. M/S. JAI ROADWAYS, OPP. H.P. REFINERY, MAHUL TERMINAL, GAVANPADA, CHEMBUR, MUMBAI 400 074. PAN: AAAFJ 0986A ......... RESPONDENT APPELLANT BY: SHRI D.S. SUNDER SINGH, DR RESPONDENT BY: SHRI DEEPAK S. SUKHIJA DATE OF HEARING: 31.5.2012 DAT E OF ORDER:8.6.2012 ORDER PER S.S. GODARA, JM: IN THIS APPEAL, THE REVENUE HAS CHALLENGED LD. CIT (A)S ORDER DATED 3.5.2011 PASSED U/S 250 OF THE ACT REGARDING ASSESSMENT YEAR 2007-08. 2. THE ONLY ISSUE IN THE PRESENT APPEAL IS AS TO WH ETHER THE DELETION OF TDS AMOUNT MADE U/S 40(A)(IA) ON TRANSPORT CHARGES BY LD. CIT (A) ON THE GROUND THAT THE SAID AMOUNT HAD BEEN PAID AFTER THE DUE DATE BUT BEFORE FILING OF RETURN IS LIABLE TO BE UPHELD BY HOLDING THAT AMENDMENT TO SEC. 40(A)(IA) IS RETR OSPECTIVELY APPLICABLE? 2 ITA NO.5342/M/2011 3. BRIEF FACTS OF THE CASE ARE THAT IN ASSESSMENT P ROCEEDINGS, THE ASSESSEE WHO IS INVOLVED IN THE BUSINESS OF TRANSPORT CONTRACTOR CO NTENDED THAT IT DEDUCTED THE TDS ON PAYMENT TO SUB-CONTRACTORS. BUT, IT FAILED TO DEPOS IT THE SAME WITHIN PRESCRIBED LIMIT. THE AO VIDE ASSESSMENT ORDER DATED 11.12.2009 MADE DISALLOWANCE U/S 40(A)(IA) OF THE ACT THEREBY ADDING THE AMOUNT IN COMPUTATION OF TOT AL INCOME. 4. IN APPEAL, THE LD CIT (A) HAS ACCEPTED THE ASSES SEES CONTENTION BY HOLDING THAT UNDISPUTEDLY THE AMOUNTS WERE CREDITED OR PAID. BU T AFTER THE DUE DATES. KEEPING IN VIEW THE FACTUAL POSITION THAT THE PAYMENT HAD BEEN MADE IN THE TREASURY BEFORE DUE DATE OF RETURN, LD CIT (A) APPLIED MUMBAI ITAT DECI SION IN THE CASE OF BANSAL PARIVAHAN AND HELD THAT AMENDMENT INTRODUCED BY FINANCE ACT, 2010 IN THE STATUTE IS RETROSPECTIVE W.E.F. 1.4.2005 COVERING THE ASSESSME NT YEAR IN HAND I.E. 2007-08. THEREFORE, ASSESSEES APPEAL HAS BEEN ACCEPTED. HENCE, THE REVENUE HAS RAISED THE PRESENT ISSUE. 5. THE LD DR APPEARING FOR THE REVENUE HAS VEHEMENT LY CONTENDED THAT THE LD CIT (A) HAS NOT APPRECIATED THE MERITS OF THE CASE AS W ELL AS LAW SETTLED IN DELETING THE DISALLOWANCE OF TDS PAYMENTS WHICH WERE NOT DEPOSIT ED BEFORE THE DUE DATE. HENCE, HE HAS PRAYED FOR ACCEPTANCE OF THE APPEAL. 6. ON THE OTHER HAND, LD AR HAS SUBMITTED THAT ISSU E IN HAND IS NO MORE RES INTEGRA IN VIEW OF HONBLE CULCUTTA HIGH COURT IN THE CASE OF CIT VS. VIRGIN CREATIONS DATED 23.11.2011 WHEREIN IT HAS BEEN HELD THAT SINCE THE ASSESSEE HAD PAID THE TDS AMOUNT BEFORE THE DUE DATE OF FILING OF RETURN, NO DISALLO WANCE U/S 40(A)(IA) COULD BE MADE. 3 ITA NO.5342/M/2011 7. IN ADDITION TO THIS, LD AR HAS ALSO REFERRED TO MUMBAI ITAT DECISION IN THE CASE OF SHRI PIYUSH C. MEHTA VS. ACIT , ITA NO.1321/M/2009, AY:2005-06, WHEREIN IT HAS BEEN HELD THAT AMENDMENT IN PROVISIONS OF SEC. 40(A )(IA) INTRODUCED BY FINANCE ACT, 2010 IS APPLICABLE WITH RETROSPECTIVE EFFECT I.E. W .E.F. 1.4.2005. 8. WE HAVE HEARD BOTH THE LEARNED REPRESENTATIVES A T LENGTH AS WELL AS GONE THROUGH THE FINDINGS RETURNED BY THE LOWER AUTHORIT IES AND CASE LAW REFERRED. FACTS AS SUCH ARE NOT IN DISPUTE. THE ASSESSEE HEREIN, AFTE R DEDUCTING TDS AMOUNT DID NOT DEPOSIT IT IN TREASURY BEFORE THE DUE DATE. BUT, S AID PAYMENT WAS CREDITED IN THE TREASURY BEFORE THE FILING OF RETURN UNDER THE PROV ISIONS OF THE ACT. SUBSEQUENTLY, VIDE FINANCE ACT 2010, IT HAS BEEN HELD THAT EVEN IF AN ASSESSEE PAYS TDS AMOUNT BEFORE THE FILING OF RETURN, NO DISALLOWANCE CAN BE MADE. THE HONBLE CALCUTTA HIGH COURT IN THE CASE OF VIRGIN CREATIONS AS WELL AS LD COORDINATE B ENCH IN CASE OF PIYUSH C. MEHTA (SUPRA) HAVE HELD THE AMENDMENT TO FINANCE ACT TO B E APPLICABLE W.E.F. 1.4.2005 (COVERING THE AY IN HAND AS WELL). 9. THEREFORE, IN RESPECTFULLY FOLLOWING THE ABOVE L EGAL AND FACTUAL POSITION, WE SEE NO REASON TO INTERFERE IN THE LD CIT (A)S ORDER IS STRICTLY IN VIEW OF THE LAW SETTLED ABOVE. 10. IN THE RESULT, APPEAL FILED BY THE REVENUE IS DISMISSED . ORDER PRONOUNCED IN THE OPEN COURT ON 8.6.2012 SD/- SD/- (B. RAMAKOTAIAH) (S.S. GODARA) ACCOUNTANT MEMBER JUDICIAL MEMBER DATE:8.6.2012 OKK COPY TO 4 ITA NO.5342/M/2011 1. ITO-22(2)(1), MUMBAI. 2. M/S. JAI ROADWAYS, MUMBAI. 3. THE CIT (A) CONCERNED. 4. THE CIT CONCERNED. 5. THE DR J, BENCH, ITAT MUMBAI. 6. GUARD FILE. // TRUE COPY // BY ORDER ASSISTANT REGISTRAR, ITAT, MUMBAI BENCHES, MUMBAI.