AARSON ENGG. CONSTRUCTION (I) P. LTD, MUMBAI V. ITO 8(1)(2), MUMBAI

ITA 5835/MUM/2012

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 8231 (ITAT-MUMBAI)
• Duration Of Justice: 4 year(s) 4 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-02-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 10-02-2017
• Assessment Year: 2007-2008
• Appeal Filed On: 24-09-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SAURABH KUMAR SR
• Assessee Lawyers: DHIRENDRA SHAH
• Keywords: Reasonable cause; Right to appeal; Condonation of delay
• Section: 143(3); 139

Judgement Text

P A G E | 1 IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, MUMBAI BEFORE SHRI R.C. SHARMA , AM AND SHRI RAVISH SOOD, JM ./ I.T.A. NO. 5835 / MUM/ 2012 ( / ASSESSMENT YEAR: 2007 - 08 ) AARSON ENGG. CONSTRUCTION (I) P. LTD. M.N. DSOUZA COMPOUND, KHERANI ROAD, SAKINAKA, MUMBAI - 400072 / VS. ITO 8(1)(2) 2 ND FLOOR, AAYAKAR BHAVAN, MUMBAI ./ ./ PAN/GIR NO. AADCA 8822 B ( / APPELLANT ) : ( / RESPONDENT ) / APPELLANT BY : SHRI DHIRENDRA SHAH / RESPONDENT BY : SHRI SAURABH KUMAR (SR. AR) / DATE OF HEARING : 10/02/2017 / DATE OF PRONOUNCEMENT : 22 /02/2017 P A G E | 2 / O R D E R PER RAVISH SOOD, JM: THE PRESENT APPEAL FILED BY THE ASSESSEE ARISES OUT OF THE ORDER PASSED BY THE CIT(A) - 16, MUMBAI , DATED 14.06.2011 , WHICH IN ITSELF ARISES FROM THE ORDER PASSED BY THE A.O U/S 143(3) OF THE INCOME - TAX ACT, 1961 (FOR SHORT ACT), DATED.31.08.2009 IN RELATION THE ASSESSMENT Y EAR 2007 - 08 , THEREIN RAISING THE FOLLOWING GROUNDS OF APPEAL: - GROUNDS OF APPEAL AGAINST ORDER U/S.143 1. THE APPELLANT PRAYS THAT THE DELAY IN FILING THIS APPEAL BE CONDONED AS APPELLANT WAS PREVENTED BY REASONABLE CAUSE IN NOT ABLE TO FILE T HE APPEAL WITHIN THE STATUTORY TIME LIMIT. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) ERRED IN CONFIRMING THE ADDITION MADE OF RS.15,10,071/ - U/S 40 (A)(IA) R.W.S. 200 (1) OF THE ACT. THE APPELLANT PRAYS THAT, THE ADDITION MADE B E DELETED. 3. THE LEARNED CIT(A) AND THE ASSESSING OFFICER ERRED IN OBSERVING THAT NO TAX WAS DEDUCTED AND FAILED TO APPRECIATE THAT, THE AMOUNT OF T.D.S. DEDUCTED HAVE BEEN PAID BEFORE THE STATUTORY DUE DATE OF FILING OF RETURN AS PER SECTION 139(1) OF THE A CT AND HENCE, THE ADDITION MADE BE DELETED. 4. THE LEARNED CIT(A) ERRED IN NOT FOLLOWI NG THE DECISION OF THE BOMBAY TRIBUNAL AND THE APPELLANT PRAYS THAT, AS HELD BY BOMBAY TRIBUNAL IN THE CASE OF BA N SAL PARIVAHAN (I) PVT. LTD., THE ADDITION MADE BE DELETED. P A G E | 3 5. THE APPELLANT CRAVES LEAVE TO ADD AMEND OR ALTER ANY OR ALL OF THE GROUNDS OF APPEAL. 2. THAT THE PRESENT APPEAL FILED BY THE ASSESSEE INVOLVES A DELAY OF 384 DAYS. THE ASSESSEE HAD FILED AN APPLICATION SEEKING CONDONATION OF DELAY, WHICH IS SUPPORTED BY AN AFFIDAVIT OF THE MANAGING DIRECTOR OF THE ASSESSEE COMPANY , VIZ. MR. ABDUL HAFFEZ SHAIKH, THEREIN DEPOSING THE FACTS LEADING TO DELAY IN FILING OF THE APPEAL. IT IS CLAIMED THAT THOUGH THE APPEAL OF THE ASSESSEE COMPANY WAS HEARD BY THE CIT(A) AND ORD ER WAS PASSED ON 14.06.2011, HOWEVER NO COPY OF THE SAID ORDER WAS RECEIVED BY THE ASSESSEE. IT IS CLAIMED THAT IT WAS ONLY WHEN THE ASSESSEE HAD LAST REQUEST ED AS ON 13.07.2012 FOR A COPY OF THE SAID ORDER, THOUGH THE SAME WAS MADE AVAILABLE, BUT THE ASSE SSEE WAS INFORMED THAT THE SAID ORDER HAD ALREADY BEEN DISPATCHED AND DELIVERED ON 08.07.2011 . IT IS SUBMITTED BY THE ASSESSEE THAT THE ORDER OF THE CIT(A) WHICH AS STATED BY THE LATTERS OFFICE TO HAVE BEEN DELIVERED ON 08.07.2011 , HAD NOT BEEN RECEIVED O R WAS MISPLACED, AND AS SUCH ON RECE IVING THE PHOTOCOPY OF THE AFORESAID ORDER , THE ASSESSEE HAD THEREIN IMMEDIATELY FILED AN APPEAL WITH THE TRIBUNAL. THUS IN THE BACKDROP OF THE AFORESAID FACTS STATED IN THE APPLICATION SEEKING CONDONATION OF DELAY IN FIL ING OF THE APPEAL, WHICH IS SUPPORTED BY A DULY AFFIRMED AFFIDAVIT , IT WAS REQUESTED THAT THE DELAY INVOLVED IN FILING OF THE APPEAL MAY THEREIN BE CONDONED. 2.1 WE HAVE DULY CONSIDERED THE AFORESAID FACTS AS AVERRED BY THE ASSESSEE, WHICH WE FIND ARE SUPPORTED BY AN AFFIDAVIT OF THE MANAGING DIRECTOR . WE THOUGH ARE NOT OBLIVIOUS OF THE SETTLED POSITION OF LAW THAT THE RIGHT TO FILE AN APPEAL IS A CREATURE OF LAW , AND AS SUCH THE FAILURE P A G E | 4 ON THE PART OF AN APPELLANT TO FILE AN APPEAL WITHIN THE STIPULATED TIME PERIOD CONTEMPLATED THEREIN WOULD DIVEST HIM OF THE SAID RIGHT , BUT THEN SUCH A DELAY IN FILING OF THE APPEAL HAS TO BE LOOKED INTO IN THE BACKDROP OF THE SUFFICIENCY OF THE CAUSE LEADING TO THE SAME. THE HONBLE SUPREME COURT IN THE CASE O F : COLLECTOR, LAND ACQUISITION VS. MST. KATIJI & ORS. (1987) 167 ITR 471 (SC) REFERRING TO SEC. 5 OF THE LIMITATION ACT, 1963, HAD AT LENGTH LOOKED INTO THE SCOPE OF THE POWERS CONFERRED ON THE APPELLATE COURTS TO CONDONE THE DELAY IN FILING OF APPEALS , AND AFTER LAYING DOWN A SET OF PARAMETERS WHICH SHOULD BE BORNE IN MIND WHILE ADJUDICATING ON THE SAID ISSUE , HAD THEREIN HELD THAT IN ORDER TO ENABLE THE COURTS TO DO SUBSTANTIAL JUSTICE TO THE PARTIES BY DISPOSING OF MATTERS ON 'MERITS', A LIBERAL APPROACH SHOULD BE ADOPTED WHILE CONSIDERING THE SUFFICIENCY OF THE CAUSE WHICH HAD LED T O DELAY IN FILING OF THE APPEAL, I.E IN A MANNER WHICH SUB SERVES THE ENDS OF JUSTICE . THUS IN THE BACKDROP OF THE AFORESAID GUIDELINES, WE HEREIN LOOK INTO THE SUFFICIENCY OF THE CAUSE WHICH HAD LED TO A DELAY OF 384 DAYS IN FILING OF THE PRESENT APPEAL BEFORE US. THOUGH AT THE FIRST BLUSH THE DELAY INVOLVED IN F I LING OF THE PRESENT APPEAL IS FOUND TO BE SUBSTANTIAL, BUT THEN AS WE PERUSE THE REASON LEADING T O THE DELAY IN THE FILING OF THE APPEAL, WE FIND THAT NOTHING HAS BEEN PLACED ON RECORD BY THE DEPARTMENT WHICH COULD GO TO BELIE THE CONTENTION OF THE ASSESSEE THAT THE ORDER OF THE CIT(A) WAS NOT RECEIVED, OR HAD BEEN MISPLACED, AN D AS SUCH WOULD GO TO P ROVE OTHERWISE OR PERSUADE US TO RAISE ANY DOUBTS AS REGARDS THE GENUINENESS OF THE AFORESAID C LAIM OF THE ASSESSEE. THUS IN LIGHT OF THE CLAIM OF THE ASSESSEE, WHICH ALL THE MORE IS SUPPORTED BY AN AFFIDAVIT OF THE MANAGING DIRECTOR OF THE ASSESSEE COMP ANY, WE ARE PERSUADED P A G E | 5 TO ACCEPT THE REASON GIVEN BY THE ASSESSEE AS REGARDS THE DELAY IN FILING OF THE PRESENT APPEAL BEFORE US. WE ARE OF THE CONSIDERED VIEW THAT IN THE ABSENCE OF ANY MATERIAL BEING MADE AVAILABLE ON RECORD BY THE DEPARTMENT ON THE BASIS OF WHICH THE AFORESAID CLAIM OF THE ASSESSEE COULD BE DISLODGED , THE DELAY OF 38 4 DAYS IN FILING OF THE PRESENT APPEAL IS NOT FOUND TO BE PROMPTED BY ANY LAPSES OR LACHES ON THE PART OF THE ASSE S SEE , THEREFORE THE SAME DESERVES TO BE CONDONED . THE APPLICATION FILED BY THE ASSESSEE SEEKING CONDONATION OF DELAY OF 38 4 DAYS IN FILING THE PRESENT APPEAL IS THUS ALLOWED. 3 . BRIEFLY STATED , THE FACTS OF THE CASE ARE THAT THE ASSESSEE COMPANY WHICH IS ENGAGED IN THE BUSINESS OF ENGINEERING CONTR A CTOR S/ L ABOUR JOB HAD FILED ITS RETURN OF INCOME ON 24.10.2007 DECLAR ING TOTAL INCOME OF RS.46,191/ - WHICH WAS PROCESSED AS SUCH U/S. 143(1) OF THE ACT . THE CASE OF THE ASSESSEE WAS THEREAFTER TAKEN UP FOR SCRUTINY PROCEEDINGS U/S. 14 3 (2) , IN THE COURSE OF WH ICH PROCEEDINGS IT WAS OBSERVED BY THE A.O TH AT THE ASSESSEE HAD MADE THE FOLLOWING CONTRACTUAL PAYMENTS WITHOUT DEDUCTION OF TAX AT SOURCE : - SR. N O. NAME OF THE PAYEE EXPENSES AMOUNT (RS) DATE OF CREDIT/PAY MENT DUE DATE FOR TDS DEPOSIT DATE OF DEPOSIT OF TDS 1 SAVITRA STEEL FABRICATORS 50000 12.06.2006 07.07.2006 10.04.2007 2 20000 12.06.2006 07.07.2006 10.04.2007 3 80000 22.07.2006 07.08.2006 10.04.2007 4 540000 10.09.2006 07.10.2006 10.04.2007 5 180000 16.10.2006 07.11.2006 10.04.2007 P A G E | 6 6 100000 14.11.2006 07.12.2006 10.04.2007 7 10000 25.11.2006 07.12.2006 10.04.2007 8 7497 25.11.2006 07.12.2006 10.04.2007 9 MEHBOOB C ONSTRUCTIONS 200000 21.04.2006 07.05.2006 10.04.2007 10 100000 09.05.2006 07.06.2006 10.04.2007 11 165000 12.06.2006 07.07.2006 10.04.2007 12 35000 12.06.2006 07.07.2006 10.04.2007 13 9675 19.10.2006 07.11.2006 10.04.2007 14 40000 24.11.2006 07.12.2006 10.04.2007 15 JYOTI CONSTRUCTIONS CO. 73000 10.06.2006 07.07.2006 10.04.2007 16 50000 06.10.2006 07.11.2006 10.04.2007 17 23000 06.10.2006 07.11.2006 10.04.2007 18 79149 24.11.2006 07.12.2006 10.04.2007 19 85000 24.11.2006 07.12.2006 10.04.2007 20 50000 23.12.2006 07.01.2007 10.04.2007 21 PRATIMA ENGINEERING WORKS 37800 07.06.2006 07.07.2006 10.04.2007 22 22200 16.12.2006 07.11.2006 10.04.2007 23 18750 20.12.2006 07.01.2007 10.04.2007 24 20000 01.01.2007 07.02.2007 10.04.2007 TOTAL 15,10,071 P A G E | 7 4 . THE ASSESSEE ON BEING CONFRONTED BY THE A.O AS REGARDS THE AFORESAID DEFAULT, THEREIN SUBMITTED THAT AS IT HAD RECEIVED THE BILLS FROM THE AFORESAID PARTIES IN THE MONTH OF MARCH, THEREFORE AFTER DEDUCTION OF THE TAX AT SOURCE THE SAME WAS DULY DEPOSITED BY HIM WITH TH E GOVERNMENT TREASURY AS ON 10.04.2007, I.E WELL WITHIN THE STIPULATED TIME PERIOD CONTEMPLATED UNDER CHAPTER XVIIB OF THE ACT . T H E AFORESAID EXPLANATION OF THE ASSESSEE DID NOT FIND FAVOR WITH THE A . O , WHO BEING OF THE VIEW THAT AS THE ADVANCE PAYMENTS TO THE AFORESAID PARTIES HAD ALREADY BEEN MADE BY THE ASSESSEE ON THE BASIS OF COMPLETION OF PARTIAL JOBS, THEREFORE THE LIABILITY OF THE ASSESSEE TO COMPLY WITH THE STATUTORY OBLIGATION AS REGARDS THE TDS PROVISION S CRYSTAL L IZED ON THE SAID RESPECTIVE DAT ES ITSELF , AND THEREFORE COULD NOT BE DEFERRED AND AS SUCH RELATED TO THE MONTH OF MARCH, 2007. THE A.O THUS ON THE BASIS OF HIS AFORESAID CONVICTION, BEING OF THE VIEW THAT THE ASSESSEE HAD FAILED TO COMPLY WITH THE PROVISIONS OF SEC. 40(A)(IA) R.W SEC. 2 00(1) OF THE ACT, THEREIN DISALLOWED THE SAME AS AN EXPENDITURE IN THE HANDS OF THE ASSESSEE, AND CONSEQUENTLY MADE AN ADDITION OF RS. 15,10,071/ - (SUPRA). THE A . O THEREAFTER DELIBERATING ON CERTAIN OTHER ISSUES , ASSESSED THE INCOME OF THE ASSESSEE AT RS. 19,72,670/ - . 5 . THE ASSESSEE BEING AGGRIEVED WITH THE ASSESSMENT ORDER THEREIN CARRIED THE MATTER IN APPEAL BEFORE THE CIT(A).TH AT IT WAS AVERRED BY THE ASSESSEE THAT AS THE TAX DEDUCTED AT SOURCE BY THE ASSESSEE D URING THE YEAR UNDER CONSIDERATION WAS DEPOSITED WITH THE GOVERNMENT TREASURY AS ON 10.04.2007, I.E PRIOR TO THE DUE DATE O F FILING OF THE RETURN OF INCOME U/S. 139( 1 ) OF THE ACT , THEREFORE NO DISALLOWANCE OF RS. 15,10,071/ - WAS CALLED FOR U/S 40(A)(IA). THE ASSESSSEE IN SUPPORT OF HIS AFORESAID CONTENTION RELIED ON THE ORDER OF THE ITAT, B B ENCH P A G E | 8 MUMBAI IN THE CASE OF : M/S BANSAL PARIVAHAN (INDIA) PVT. LTD. VS. ITO, W ARD 8(I), MUMBAI (ITA NO. 2355/MUMBAI/2010 , AY 2006 - 07), DATED 22.09.2010 , WHEREIN A COORDINATE BENCH OF THE T RIBUNAL HA D HELD THAT THE AME N DMENT OF SECTION 40(A)(IA) VIDE THE F INANCE ACT , 2010, WITH EFFECT FROM 01.04.2010, BEING IN THE NATURE OF A REMEDIAL/CURATIVE PROVISION WHICH WAS MADE AVAILABLE ON THE STATUTE, WAS THUS TO BE GIVEN A RETROSPECTIVE E FFECT , AND AS SUCH HAD TO BE CONSTRUED AS IF THE SAME WAS AVAILABLE ON THE STATUTE WITH EFFECT FROM 1 ST APRIL, 2005, HAD HELD AS UNDER: - THE PROVISIONS OF SECTION 40(A)(IA) AS STOOD PRIOR TO THE AMENDMENTS MADE BY THE FINANCE ACT , 2010 THUS WERE RESULTING IN TO UNINTENDED CONSEQUENCES AND CAUSING GRAVE AND GENUINE HARDSHIPS TO THE ASSESSES WHO HAD SUBSTANTIALLY COMPLIED WITH THE RELEVANT TDS PROVISIONS BY DEDUCTING THE TAX AT SOURCE AND BY PAYING THE SAME TO THE CREDIT OF THE GOVERNMENT BEFORE THE DUE DATE OF FILING OF THEIR RETURNS U/S. 139(1). IN ORDER TO REMEDY THIS POSITION AND TO REMOVE THE HARDSHIPS WHICH WAS BEING CAUSED TO THE ASSESSEES BELONGING TO SUCH CATEGORY, AMENDMENTS, HAVE BEEN MADE IN THE PROVISIONS OF SECTION 40(A)(IA) BY THE FINANCE ACT 2010 . THE SAID AMENDMENT, IN OUR OPINION THUS ARE CLEARLY REMEDIAL/CURATIVE IN NATURE AS HELD BY HONBLE SUPREME COURT IN THE CASE OF ALLIED MOTORS PVT. LTD. (SUPRA) AND ALOM EXTRUSIONS LTD. (SUPRA) AND THE SAME THEREFORE WOULD APPLY RETROSPECTIVELY W.E.F. 1 S T APRIL, 2005. THE CIT(A) HOWEVER NOT FINDING FAVOR WITH THE CONTENTION OF THE ASSESSEE , AND RATHER HOLDING A CONVICTION THAT THE EXTENDED PERIOD OF P A G E | 9 DEPOSITING THE TDS UP TO THE DUE DATE SPECIFIED U/S. 139(1) WAS ONLY AVAILABLE WITH RESPECT TO THOSE AMOUNTS WHERE THE TDS HA D BEEN DEDUCTED DURING THE LAST MONTH OF THE PREVIOUS YEAR, THEREFORE UPHELD THE ORDER OF THE A . O AND DISMISSED THE APPEAL OF THE ASSESSEE. 6 . THE ASSESSEE BEING AGGRIEVED WITH THE ORDER OF THE CIT(A) HAD THUS CARRIED THE MATTER I N APPEAL BEFORE US. THAT AT THE VERY OUTSET OF THE HEARING OF THE APPEAL IT WAS SUBMITTED BY THE LD. AUTHORIZED REPRESENTATIVES FOR THE ASSESSEE (FOR SHORT A . R ) THAT AS THE TAX WAS DEDUCTED AT SOURCE BY THE ASSESSEE COMPANY DURING THE YEAR UNDER CONSIDER ATION , WHICH THEREAFTER WAS DEPOSITED WITH THE GOVERNMENT TREASURY MUCH PRIOR TO THE DUE DATE O F THE FILING OF THE RETURN OF INCOME U/S.139(1),THEREFORE, IN LIGHT OF THE CLEARLY WORDED SECTION 40(A)(IA) OF THE ACT , NO DISALLOWANCE UNDER THE SAID STATUTORY PROVISION WAS CALLED FOR IN THE HANDS OF THE ASSESSEE COMPANY. THE LD. A . R REBUTTING THE OBSERVATION OF THE CIT(A) THAT THE AME N DMENT OF SECTION 40(A)(IA) VIDE THE F INANCE ACT , 2010, WHICH THEREIN RELAXED THE RIGORS OF THE SAID STATUTORY PROVISI ON BY EXTENDING THE PERIOD FOR DEPOSITING THE TDS DURING THE YEAR TO THE DUE DATE OF FILING OF THE RETURN OF INCOME U/S 139(1), WAS APPLICABLE PROSPECTIVELY, I.E WAS TO BE GIVEN EFFECT FROM A.Y. 2010 - 11, THEREIN SUBMITTED THAT AS THE SAID AMENDMENT WAS IN THE NATURE OF A REMEDIAL/CURATIVE PROVISION WHICH WAS MADE AVAILABLE ON THE STATUTE, THE SAME THUS HAD TO BE GIVEN A RETROSPECTIVE E FFECT AND CONSTRUED AS IF THE SAME WAS AVAILABLE ON THE STATUTE WITH EFFECT FROM 1 ST APRIL, 2005, THEREIN RELIED ON THE J UDGMENT OF THE HONBLE GUJ A RAT HIGH COURT IN THE CASE OF CIT VS. J.K. CONSTRUCTION COMPANY (2014) 361 ITR 181 (GUJ) , WHEREIN THE HONBLE HIGH COURT DEALING WITH THE CASE INVOLVING ASSESSMENT YEAR P A G E | 10 2005 - 06 , HAD UPHELD THE VIEW OF THE T RIBUNAL THAT BY VIRTUE OF THE AMENDMENT MADE TO SECTION 40(A)(IA) WITH EFFECT FROM 01.04.2005, THE DEPOSIT OF THE TDS BY THE ASSESSEE BEFORE THE DUE DATE SPECIFIED IN SUBSECTION (1) OF SECTION 139 OF THE ACT WAS TO BE CONSTRUED TO BE WELL WITHIN THE P ARAMETERS CONTEMPLATED UNDER THE AFORESAID STATUTORY PROVISION, AND AS SUCH NO DISALLOWANCE U/S. 40(A)(IA) WITH RESPECT TO THE SAID AMOUNT WAS CALLED FOR IN THE HANDS OF THE ASSESSEE. THE HONBLE HIGH COURT CLEARLY EXPRESSING ITS VIEW THAT THE AMENDMENT W ITH RESPECT TO THE DEPOSIT OF THE TDS UP TO THE DUE DATE SPECIFIED IN SECTION 139(1), THOUGH WAS MADE AVAILABLE ON THE STATUTE VIDE THE F INANCE ACT , 2010, W.E.F. 01.04.2010, THE SAME WAS HOWEVER TO BE GIVEN A RETROSPECTIVE E FFECT, I.E W. R. E.F. 01.04.2005 , HAD THEREIN HELD AS UNDER: - IN THE BACKGROUND OF THE ABOVE UNDISPUTED FACTS, THE TRIBUNAL WAS OF THE OPINION THAT BY VIRTUE OF THE AMENDED PROVISIONS OF SECTION 40(A)(IA) OF THE INCOME TAX ACT, 1961, THE ASSESSEE HAS NOT BREACHED THE REQUIREMENT OF THE DEDUCTION AND DEPOSITING OF TDS. 3. SECTION 40(A)(IA) OF THE ACT, AS AMENDED WITH EFFECT FROM APRIL 1, 2005, READ AS UNDER: (IA) ANY INTER EST COMMISSION OR BROKERAGE, RENT, ROYALTY , FEES FOR PROFESSIONAL SERVICES OR FEES FOR TECHNICAL SERVICES PAYABLE TO A RESIDENT, OR AMOUNTS PAYABLE TO A CONTRACTOR OR SUB - CONTRACTOR, BEING RESIDENT, FOR CARRYING OUR ANY WORK (INCLUDING SUPPLY OF LABOUR FO R CARRYING OUT ANY WORK), ON WHICH TAX IS DEDUCTIBLE AT SOURCE UNDER CHAPTER XVII - B AND SUCH TAX HAS NOT BEEN DEDUCTED OR AFTER DEDUCTION, HAS NOT P A G E | 11 BEEN PAID ON OR BEFORE THE DUE DATE SPECIFIED IN SUB SECTION (1) OF SECTION 139. 4. PLAINLY SPEAKING, THE A SSESSEE HAD TO MAKE DEDUCTION BEFORE 31 ST MARCH OF THE YEAR IN QUESTION AND AS LONG AS SUCH AMOUNTS WERE DEPOSITED BEFORE THE LAST DATE OF FILING OF THE RETURN, REQUIREMENTS OF LAW WOULD BE FULFILLED. IT WAS ON THIS BASIS THAT THE TRIBUNAL WAS OF THE OPINI ON THAT THE ASSESSEE COMMITTED NO WRONG AND WAS, THEREFORE ENTITLED TO SEEK DEDUCTION OF RS.32,94,149/ - FROM THE INCOME WHICH AMOUNT THE ASSESSEE HAD DEDUCTED FROM PAYMENTS OF CONTRACTORS AND HAD ALSO DEPOSITED WITH THE REVENUE BEFORE THE LAST DATE OF FIL ING OF THE RETURN. WE DO NOT FIND ANY ILLEGALITY IN THE ORDER OF THE TRIBUNAL. THE TAX APPEAL IS, THEREFORE, DISMISSED. THUS IN THE BACKDROP OF THE FACTS INVOLVED IN THE PRESENT CASE, IT WAS AVERRED BY THE LD. A . R THAT N OW WHEN THE ASSESSEE COMPANY HAD DE POSITED THE TDS MUCH BEFORE THE DUE DATE FOR FILING OF ITS RETURN OF INCOME U/S. 139(1) OF THE ACT , THEREFORE, IN LIGHT OF THE AMENDMENT TO SECTION 40(A)(IA) VIDE THE F INANCE 2010, WHICH AS HELD BY THE HONBLE HIGH COURT OF GUJ A RAT HAS TO BE GIVEN A RETROSPECTIVE E FFECT, THEREFORE NO DEFAULT ON THE PART OF THE ASSESSSEE AS REGARDS THE COMPLIANCE OF THE TDS PROVISION S CONTEMPLATED U/S. 40(A)(IA) R.W.S. 200(1) OF THE ACT, HAD THUS EMERGED, AS A RESULT WHEREOF NO DISALLOWANCE OF THE E XPENSES AGGREGATING TO RS. 15,10,071/ - WAS CALLED FOR U/S 40(A)(IA) IN TH E HANDS OF THE ASSESSEE COMPANY. THAT ON THE OTHER HAND THE LD. DEPARTMENTAL REPRESENTATIVES (FOR SHORT D . R) HEAVILY RELIED ON THE ORDERS OF THE LOWER AUTHORITIES. P A G E | 12 7 . WE HAVE HEARD THE LD. AUTHORIZED REPRESENTATIVES O F BOTH THE PARTIES, PERUSED THE ORDER S OF THE LOWER AUTHORITIES AND THE MATERIAL PRODUCED BEFORE US. THAT BEFORE ADVERTING FURTHER, IT WOULD BE RELEVANT TO POINT OUT THAT IN LIGHT OF THE VERY FACT THAT THE A.O HAD HELD THE ASSESSEE COMPANY TO HAVE DEFAULTED THE PROVISIONS OF SEC. 40(A)(IA) R.W.S 200(1), THEREFORE IT EMERGES THAT IT IS A MATTER OF CONCEDED FACT THAT THE A.O HAD HELD THAT THOUGH THE ASSESSEE HAD DEDUCTED THE TAX AT SOURCE DURING THE YEAR UNDER CONSIDERATIO N, BUT HAD FAILED TO DEPOSIT THE SAME WITHIN THE STIPULATED TIME PERIOD CONTEMPLATED U/S 200(1). THUS IN LIGHT OF THE AFORESAID FACTS AS EMERGES FROM THE BODY OF THE ASSESSMENT ORDER, THE SOLE ISSUE THAT SURVIVES FOR ADJUDICATION BEFORE US IS AS TO WHETHER IN THE BACKDROP OF THE FACT THAT NOW WHEN THE ASSESSEE COMPANY AFTER DEDUCTING THE TAX AT SOURCE DURING THE YEAR UNDER CONSIDERATION HAD DEPOSITED THE SAME AS ON 10.04.2007, I.E THOUGH BEYOND THE PERIOD SPECIFIED U/S. 200(1) OF THE ACT , BUT BEFORE THE DUE DATE OF FILING OF ITS RETURN OF INCOME U/S. 139(1), THE SAME WOULD CALL FOR A DISALLOWANCE U/S. 40(A)(IA), OR NO T . WE HAVE GIVEN A THOUGHTFUL CONSIDERATION TO THE FACTS OF THE CASE AND ARE OF THE CONSIDERED VIEW THAT AS THE ASSESSEE COMPA NY AFTER DEDUCTING THE TAX AT SOURCE PERTAINING TO THE AFORESAID AMOUNT AGGREGATING TO RS. 15,10,071/ - (SUPRA) DURING THE YEAR UNDER CONSIDERATION , HAD THEREAFTER DEPOSITED THE SAME WITH THE GOVERNMENT TREASURY BEFORE THE DUE DATE FOR FILING OF THE RETURN OF INCOME U/S.139(1) OF THE ACT, THEREFORE IN LIGHT OF THE AMENDMENT MADE TO SECTION 40(A)(IA) VIDE THE FINANCE ACT 2010, WHICH A S HELD BY THE HONBLE HIGH COURT OF GUJ A RAT IN THE CASE OF J.K. CONSTRUCTION COMPANY (SUPRA) HAS TO BE GIVEN A RETROSPECTIVE E FFECT, AND THUS H AS TO BE CONSTRUED AS IF THE P A G E | 13 SAME WAS AVAILABLE ON THE STATUTE WITH EFFECT FROM 1 ST APRIL, 2005 , THEREFORE ARE OF THE CONSIDERED VIEW THAT NOW WHEN IN THE PRESENT CASE THE TDS HAD BEEN DEPOSITED BY THE ASSESSEE COMPANY AS ON 10.04.2007, I.E MUCH PRIOR TO THE DUE DATE FOR FILING OF ITS RETURN OF INCOME U/S. 139(1), THEREFORE NO DISALLOWANCE U/S.40(A)(IA) OF THE AMOUNTS RELATABLE THERE TO WAS CALLED FOR IN THE HANDS OF THE ASSESSEE COMPANY. THUS IN LIGHT OF OUR AFORESAID OBSERVATIONS , WE HEREIN SET ASIDE THE ORDER OF THE CIT(A) WHO HAD SUSTAINED THE ADDITION /DISALLOWANCE OF RS.15,10,071/ - SO MADE BY THE AO U/S 40(A)(IA) OF THE ACT. 8. THE APPEAL OF THE ASSESSEE IS ALLOWED. ORDER PRO NOUNCED IN THE OPEN COURT AS ON 2 2 /02/2017. SD/ - SD/ - (R.C SHARMA) (RAV ISH SOOD) / ACCOUNTANT MEMBER / JUDICIAL MEMBER MUMBAI ; DATED : 22 .02.2017 P A G E | 14 / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3. ( ) / THE CIT(A) 4. / CIT CONCERNED 5. , , / DR, ITAT, MUMBAI 6. / GUARD FI LE / BY ORDER, / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI .