The Dy. Commr. Income Tax, Gandhidham Circle, GANDHIDHAM V. M/s Shree Radhey Shipping Company, GANDHIDHAM

ITA 560/RJT/2014

• Counselvise Citation: [2015] 121 COUNSELVISE.COM (IT) 1100 (ITAT-RAJKOT)
• Duration Of Justice: 7 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-05-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 28-05-2015
• Assessment Year: 2007-2008
• Appeal Filed On: 30-09-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AVINASH KUMAR
• Section: 154; 139

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL RAJKOT BENCH, RAJKOT BEFORE SHRI SHAILENDRA KUMAR YADAV, JUDICIAL MEMBER AND SHRI N.S. SAINI, ACCOUNTANT MEMBER ./ ITA NO.560/RJT/2014 WITH CO NO.24/RJT/2014 / ASSTT. YEAR: 2007-08 DCIT, GANDHIDHAM CIRCLE GANDHIDHAM-KUTCH. VS M/S.SHREE RADHEY SHIPPING COMPANY OFFICE NO.212/213, SUNDER PARK 1 ST FLOOR, PLOT NO.95 TAGORE ROAD, GANDHIDHAM KUTCH. / (APPELLANT) / (RESPONDENT) REVENUE BY : SHRI AVINASH KUMAR, DR ASSESSEE BY : SHRI VIMAL DESAI, CA / DATE OF HEARING : 28/05/2015 / DATE OF PRONOUNCEMENT: 29 /05/2015 / O R D E R PER N.S. SAINI, ACCOUNTANT MEMBER: THIS AN APPEAL FILED BY THE REVENUE AND CROSS OBJECTION BY THE ASSESSEE AGA INST ORDER OF THE CIT(A)-II, RAJKOT DATED 14.7.2014 ASSTT.YEAR 2007-0 8. 2. THE SOLE GROUND OF APPEAL TAKEN BY THE REVENUE I N THIS APPEAL IS THAT THE CIT(A) WAS NOT JUSTIFIED IN APPLYING THE A MENDMENT MADE IN PROVISIONS OF SECTION 40A(IA) VIDE FINANCE ACT, 201 0 RETROSPECTIVELY. 3. BRIEF FACTS OF THE CASE ARE THAT THE AO OBSERVED THAT THE ASSESSEE HAD MADE PAYMENT OF RS.49,07,208/- ON ACCOUNT OF SU B-CONTRACT WORK, ON WHICH THE TAX WAS DEDUCTED, BUT NOT PAID TO THE ACCOUNT OF THE GOVERNMENT WITHIN THE STIPULATED TIME. THEREFORE, THE AO DISALLOWED DEDUCTION OF RS.49,07,208/- BY INVOKING THE PROVISI ONS OF SECTION 40(A)(IA) OF THE ACT. ITA NO.560/RJT/2014 WITH CO 2 4. ON APPEAL, THE CIT(A) OBSERVED THAT THE TDS ON R S.49,07,208/- WAS PAID TO THE ACCOUNT OF CENTRAL GOVERNMENT BY TH E ASSESSEE ON 9.4.2007, WHICH WAS BEFORE THE DUE DATE OF FILING O F THE RETURN OF INCOME FOR THE ASSTT.YEAR 2007-08 UNDER SECTION 139 (1) OF THE ACT. THEREFORE, HE, FOLLOWING THE DECISION OF THE HONBL E CALCUTTA HIGH COURT IN THE CASE OF CIT VS. VIRGIN CREATIONS IN GA NO.32 00 OF 2011 ORDER DATED 23.11.2011, WHEREIN IT WAS HELD THAT THE AMEN DMENT MADE BY THE FINANCE ACT, 2010 WAS RETROSPECTIVE IN NATURE, WHICH PROVIDED THAT IF THE TAX DEDUCTED AT SOURCE WAS PAID BY THE ASSES SEE TO THE CREDIT OF THE CENTRAL GOVERNMENT BEFORE THE DUE DATE OF FILIN G OF THE RETURN OF INCOME UNDER SECTION 139(1) OF THE ACT, THEN NO DIS ALLOWANCE UNDER SECTION 40(A)(IA) OF THE ACT CAN BE MADE BY THE AO, DELETED THE ADDITION. 5. WE FIND THAT THE HONBLE GUJARAT HIGH COURT HAS TAKEN A SIMILAR VIEW IN THE CASE OF CIT VS. OMPRAKASH R. CHAUDHARY, (2015) 57 TAXMANN.COM 38 (GUJ) WHEREIN IT WAS HELD THAT NO DI SALLOWANCE UNDER SECTION 40(A)(IA) OF THE ACT CAN BE MADE IF THE TDS WAS DEPOSITED BY THE ASSESSEE BEFORE THE DUE DATE OF FILING OF RETUR N OF INCOME UNDER SECTION 139(1) OF THE ACT. THE AMENDMENT TO SECTIO N 40(A)(IA) OF THE ACT BY THE FINANCE ACT, 2010 WAS RETROSPECTIVE. S IMILAR VIEW WAS ALSO TAKEN BY THE HONBLE GUJARAT HIGH COURT IN THE CASE OF CIT VS. ROYAL BUILDERS, (2013) 40 TAXMANN.COM 464. THEREFORE, WE FIND NO INFIRMITY IN THE ORDER OF THE CIT(A), WHICH IS HEREBY CONFIRM ED, AND THE GROUND OF APPEAL OF THE REVENUE IS DISMISSED. CO NO.24/RJT/2014 (ASSESSEES CO) 6. IN THE CO, THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS: 1. THELD.CIT(A) HAS ERRED IN LAW AS WELL AS ON FA CTS IN NOT ADJUDICATING THAT THE DISALLOWANCE OF 40(A)(IA) IN THE APPELLANTS CASE WAS OUTSIDE THE PURVIEW OF SECTION 154 AS THER E WAS NO APPARENT MISTAKE INVOLVED. ITA NO.560/RJT/2014 WITH CO 3 7. IN VIEW OF OUR DECISIONS IN THE APPEAL OF THE RE VENUE, WHEREIN, WE HAVE HELD THAT NO DISALLOWANCE UNDER SECTION 40( A)(IA) OF THE ACT CAN BE MADE, IF THE TDS WAS DEPOSITED BY THE ASSESS EE BEFORE THE DUE DATE OF FILING OF THE RETURN OF INCOME UNDER SECTIO N 139(1) OF THE ACT, AND THAT THE AMENDMENT MADE BY THE FINANCE ACT, 201 0 IS RETROSPECTIVE IN NATURE, THE ABOVE GROUND OF THE AS SESSEE HAS BECOME ACADEMIC IN NATURE, AND HENCE, IS NOT BEING ADJUDIC ATED UPON. THUS, THIS GROUND OF THE CROSS OBJECTION OF THE ASSESSEE IS DISMISSED. 8. IN THE RESULTS, APPEAL OF THE REVENUE AND CROSS OBJECTION OF THE ASSESSEE, BOTH ARE DISMISSED. ORDER PRONOUNCED IN THE COURT ON FRIDAY THE 29 TH MAY, 2015 AT RAJKOT. SD/- SD/- ( SHAILENDRA KUMAR YADAV ) JUDICIAL MEMBER ( N.S. SAINI) ACCOUNTANT MEMBER