Assistant Commissioner of Income-tax, V. M/s. Shree Panchaganga Agro Impex Pvt. Ltd.,Ltd., Pune

ITA 613/PUN/2015

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 9266 (ITAT-PUNE)
• Duration Of Justice: 2 year(s) 2 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-07-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2007-2008
• Appeal Filed On: 30-04-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Retrospective amendment; Speculation loss; Revised return
• Section: 143(3); 263; 139

Judgement Text

] IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH A, PUNE BEFORE MS. SUSHMA CHOWLA, JM AND SHRI ANIL CHATURVEDI, AM . / ITA NO.613/PUN/2015 / ASSESSMENT YEAR : 2007-08 THE ASST. COMMISSIONER OF INCOME TAX, CIRCLE -6, PMT BUILDING, SWARGATE, PUNE 411 037. . / APPELLANT V/S M/S. SHREE PANCHAGANGA AGRO IMPEX PVT. LTD. GAT NO.559, PUNE NAGAR ROAD, WAGHOLI, PUNE 412207. PAN : AAFCS6775C. . / RESPONDENT / APPELLANT BY : SHRI YOGESH KAMAT. / RESPONDENT BY : SHRI PRAYAG JHA & SHRI PRATEEK JHA. / ORDER PER ANIL CHATURVEDI, AM : THIS APPEAL FILED BY THE REVENUE IS EMANATING OUT OF THE ORDER OF COMMISSIONER OF INCOME TAX (A) 4, PUNE, DT.16.0 2.2015 FOR THE ASSESSMENT YEAR 2007-08. 2. THE RELEVANT FACTS AS CULLED OUT FROM THE MATERIAL ON R ECORD ARE AS UNDER :- 2.1 ASSESSEE IS A COMPANY STATED TO BE ENGAGED IN THE BUSINESS OF IMPORT AND EXPORT AND TRADING OF SPICES, DRY FRUIT AN D PROCESSING OF AGRO PRODUCTS ETC. ASSESSEE INITIALLY FILED ITS RETURN O F / DATE OF HEARING : 31.05.2017 / DATE OF PRONOUNCEMENT: 07.07.2017 2 INCOME FOR A.Y. 2007-08 ON 31.10.2007 DECLARING TOTAL INCOME OF RS.78,09,387/-. ASSESSEE THEREAFTER REVISED ITS RETURN O F INCOME ON 12.03.2008 DECLARING TOTAL INCOME OF RS.41,40,126/-. THE C ASE WAS TAKEN UP FOR SCRUTINY AND THEREAFTER THE ASSESSMEN T WAS FRAMED U/S 143(3) OF THE ACT ON 31.12.2009 ON THE BASIS O F REVISED RETURN OF INCOME. SUBSEQUENTLY LD.CIT OBSERVED THAT T HE ASSESSMENT ORDER FRAMED BY THE AO U/S 143(3) OF THE AC T WAS ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF REVENUE. HE ACCORDINGLY PASSED AN ORDER ON 29.03.2012 U/S 263 OF TH E ACT AND DIRECTED THE AO TO MAKE FRESH ASSESSMENT AFTER CONSIDER ING HIS OBSERVATIONS MADE THEREIN. PURSUANT TO THE ORDER OF LD .CIT, AO PASSED ORDER U/S 143(3) R.W.S. 263 OF THE ACT VIDE ORDE R DT.28.03.2013 AND DETERMINED THE TOTAL INCOME AT RS.56,9 7,960/-. AGGRIEVED BY THE ORDER OF AO, ASSESSEE CARRIED THE MATT ER BEFORE LD.CIT(A), WHO GRANTED PARTIAL RELIEF TO THE ASSESSEE. AGGRIE VED BY THE ORDER OF LD.CIT(A), REVENUE IS NOW IN APPEAL BEFORE US AND HAS RAISED THE FOLLOWING GROUNDS : 1. THE ORDER OF THE COMMISSIONER OF INCOME-TAX (AP PEALS) IS CONTRARY TO LAW AND TO THE FACTS AND CIRCUMSTANCES OF THE CASE. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE LEARNED COMMISSIONER OF INCOME-TAX (APPEAL S) HAS ERRED IN DIRECTING THE ASSESSING OFFICER TO VERIFY THE CLAIM OF SET OFF OF SPECULATION LOSSES BROUGHT FORWARD FROM A.Y.2005- 06, AS THE INCOME-TAX ACT DOES NOT EMPOWER THE CIT( A) TO SET ASIDE THE MATTER TO THE A.O. 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE LEARNED COMMISSIONER OF INCOME-TAX (APPEAL S) HAS ERRED IN DIRECTING THE ASSESSING OFFICER TO VERIFY THE CLAIM OF PAYMENT OF TDS BY THE ASSESSEE, WHICH IS NOT SUPPOR TED BY THE REVISED RETURN IN CONTRAVENTION OF THE SUPREME COURT DECISION IN CASE OF GOETZE (INDIA) LTD VS. CIT(2006) 284 ITR 323 (SC). 4. FOR THIS AND SUCH OTHER REASONS AS MAY BE URGED AT THE TIME OF HEARING, THE ORDER OF LD.CIT(A) MAY BE VACA TED AND THAT OF THE ASSESSING OFFICER BE RESTORED. 3 3. THOUGH REVENUE HAS RAISED VARIOUS GROUNDS BEFORE US BUT THE SOLE CONTROVERSY AS PER BOTH THE PARTIES IS THE DIR ECTION OF LD.CIT(A) TO VERIFY THE CLAIM AND THEREBY SETTING ASIDE THE MATTER TO AO. 4. LD.CIT(A) NOTED THAT ASSESSEE WAS DENIED THE CLAIM OF SE T OF SPECULATION LOSSES OF RS.1,66,148/- WHICH HAS BEEN BROUGH T FORWARD FROM A.Y. 2005-06. IT WAS SUBMITTED THAT THOUGH THE CLAIM WAS ALLOWED IN THE ORIGINAL ASSESSMENT ORDER THE SAME NOT ALLOWED AS DEDUCTION BY JCIT IN ORDER PASSED U/S 143(3) OF THE ACT. ON THIS ISSUE WE FIND THAT LD.CIT(A) HAS DIRECTED AS UNDER: 4.1 ON THIS ISSUE, IT IS SEEN THAT THE LOSSES CLAI MED PERTAINED TO A.Y. 2005-06 WHICH SHOULD BE SET OFF AGAINST ANY SP ECULATIVE PROM EARNED FOR THE A.Y. 2006-07 AND AS PER THE PROVISI ON OF SEC. 73(1) & (2), THE SAME CAN ONLY BE SET OFF AGAINST SPECULATI ON PROFIT FOR THE SAME YEAR OR CARRIED FORWARD TO THE FOLLOWING ASSES SMENT YEAR AND SO ON. THE ASSESSING OFFICER IS THEREFORE DIRECTED TO VERIFY FROM THE RECORD WHETHER SUCH SPECULATIVE PROFIT ARE ALLOWABL E TO BE CARRIED FORWARD AND SET OFF AND ALLOW THE SAME AS PER THE P ROVISION OF SEC . 73(1) & (2) . FOR STATISTICAL PURPOSES THIS GROUND IS CONSIDERED AS ALLOWED. 5. REVENUE IS AGGRIEVED BY THE DIRECTION GIVEN BY LD.CIT(A) FOR VERIFICATION OF THE CLAIM. 6. BEFORE US, LD.D.R. SUBMITTED THAT LD.CIT(A) DOES NOT HAVE POWER TO SET ASIDE THE MATTER TO AO. HE THUS SUPPORT ED THE ORDER OF AO. LD.A.R. ON THE OTHER HAND, SUPPORTED THE ORDER OF LD.CIT(A) AND SUBMITTED THAT BROUGHT FORWARD LOSSES FROM A.Y. 2005- 06 IS UNDISPUTED AND SINCE AO WHILE FRAMING THE ORDER U/S 143(3 ) R.W.S 263 OF THE ACT HAD WRONGLY NOT ALLOWED THE DEDUCTION T HE 4 NECESSARY DIRECTIONS WERE GIVEN BY LD.CIT(A) WHICH HE WAS JUSTIFIED. HE THUS SUPPORTED THE ORDER OF LD.CIT(A). 7. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. IT IS AN UNDISPUTED FACT THAT LD.CIT(A ) DOES NOT HAVE POWER TO REMAND THE MATTER TO AO BUT IN THE PRE SENT CASE, WE FIND THAT LD.CIT(A) HAS SENT THE MATTER TO AO BUT IT IS O NLY FOR THE FACTUAL VERIFICATION OF ALLOWABILITY OF LOSSES AS PER PROVISION OF SECS.73(1) AND (2) MORE SO WHEN THE CLAIM OF CARRY FORWAR D OF LOSS FOR A.Y. 2005-06 WAS ALLOWED BY AO WHICH PASSING THE ORDER IN A.Y. 2005-06. IN SUCH A SITUATION, WE FIND NO ERROR IN TH E ORDER OF LD.CIT(A) AND THUS THE GROUND OF REVENUE IS DISMISSED. 8. SECOND GROUND IS WITH RESPECT TO ALLOWING CLAIM OF PAYMEN T OF TDS. 8.1 ASSESSEE HAD CLAIMED DEDUCTION U/S 40(A)(IA) WITH RESPE CT TO THE AMOUNTS ON WHICH TDS WAS DEDUCTED AND WAS DEPOS ITED IN THE GOVERNMENT ACCOUNT BEFORE THE DUE DATE OF FILING OF RETURN . AO DID NOT ALLOW THE CLAIM OF SUCH AMOUNTS AGGREGATING TO RS.36,79 ,391/- BY INVOKING PROVISIONS OF SEC.40(A)(IA) OF THE ACT. AGGRIEVED B Y THE ORDER OF AO, ASSESSEE CARRIED THE MATTER BEFORE LD.CIT(A) , WHO DECIDED THE ISSUE IN FAVOUR OF THE ASSESSEE BY HOLDING AS UNDER : 5 . 1 IN THE TAX AUDIT REPORT, A COPY OF WHICH PLACED I S PLACED AT ' PAQES 2 2 TO 2 6, IN PARA-17 (F) , IT WAS MENTIONED , IN THE FOLLOWING CAS E S THERE IS DELAY IN PAYMENT OF TDS AND M A Y ATTRACT THE PROVISIONS OF SECTION 40(A)(IA). IN TH E COMPUTATION TO TOTAL I NCOME THIS AMOUNT WAS ADDED BACK. HOWEVER , DURING THE ORIGINAL ASSESSMENT PROCEEDINGS, IT WAS SUBM I T T E D THA T THE TAX WAS DEDUCTED ON THESE PAYMENT S AS PER LAW AND THE SAID TDS WAS 5 DEP OS ITED I N ACCOUNT OF CENTRAL GOVERNMENT BEFORE THE DUE DATE OF FILING OF RETURN A S PROVIDED IN SECTION 139 (1). THEREFORE, THE EXPENSES WERE NOT DISALLOWABLE U/S 40(A) (IA) . TIME FO R F IL I N G A REV I SED RETURN WAS NOT AVAILABLE AT THAT POINT OF TIM E. HENCE THE RETURN COULD N OT B E R E V IS E D BUT A CLAIM WAS MADE BEFORE THE LD AO. 5 . 2 THE LD AO, WHO PASSED THE ORIGINAL ORDER, ALLOWED THE DEDUCTION OF THI S A MOUNT . HOWEVER, IN THE ASSESSMENT ORDER PASSED U/S 1 4 3(3) RWS 263, THIS DEDUCTION HA S NO T B EE N ALLOWED PERHAPS IN VIEW OF THE JUDGMENT OF SUPREME COURT IN THE CASE OF GOETZE ( I ND IA) LTD. V CIT [2006] 284 ITR 323 (SC). 5 . 3 IN THIS REGARD, IT IS SUBMITTED THAT THE FACTS ON T HE ISSUE ARE TH A T THE A S S ES SEE C O MPL I ED TO THE TDS PROVISIONS. THERE WAS NO DEFAULT I N MAKING TDS . TAX DEDUCTED AT SOURC E W AS AL SO DEPOSITED IN THE ACCOUNT OF THE CENTRAL GOVERNMENT WITHIN TH E F Y 2006-07 . ON C ER T A IN PAYMENTS AND PROVISIONS TAX WAS DEDUCTED IN THE MONTH OF MAR C H 2007 BUT D EPOSITED IN GOVERNMENT ACCOUNT AFTER 31/03/2007 BUT BEFORE THE DUE DATE OF FILING OF R ETU RN A S PROVIDED U/S 139(1) . FOR THE A Y 2007 - 08 DUE DATE OF FILING OF RETURN WAS 31/10/2007. THEREFORE , PROVISIONS OF SECTION 40(A)(IA) WERE N O T ATTRACTED TO S UCH E X PENSES . COPIES OF LEDGER ACCOUNT OF DEPOSIT OF TDS IN THE AC C OUNT OF THE CENTRAL GOVERNMENT ARE PL ACE D AT PAGES 27 TO 33 . 5 . 4 I T IS FURTHER SUBMITTED THAT A RIGHT F UL CLAIM OF TH E ASSESSEE C ANNOT BE REJECTED ONLY O N TECHNICAL GROUND THAT RETURN WAS NOT REVISED OR THAT THIS WOULD REDUCE THE TOT AL INC O M E RETURNED. ATTENTION IS DRAWN TO THE CIRCULAR NO - 14 (XI-35) OF 1955 DATED 11- 04-1 955 OF TH E DEPARTMENT, A COPY OF WHICH IS PLACED AT PAGE S 34. THE DEPARTMENT HAS E XHO RTE D I T S OFFICERS NOT TO TAKE ADVANTAGE OF IGNORANCE OF AN ASSESSEE AND ALLOW THE CLAIM AS PER LA W . 5 . 5 AS FOR AS THE JUDGMENT IN THE CASE OF GOETZE (IND IA) LTD V CIT [2006] 284 ITR 323 (S C) I S C O NCERNED IT HAS BEEN HELD IN SEVERAL CASES THAT TH E RATIO OF THI S J UDGMENT IS NOT AP PLI CA BL E TO HIGHER AUTHORITIES SUCH AS THE CIT(A ) AND THE ITAT . THE SUPREME COURT HAS CON SID ERE D TH E POWERS OF THE AAC (NOW, CIT(A) IN SEVERAL CASE A FEW OF THEM ARE THE FOLLOWING :- J U TE CORPORATION OF INDIA LTD V CIT [1990) 187 TR 688 NATIONAL THERMAL COMPANY LTD V CIT [1998] 229 ITR 3 83 CIT V NIRBHERAM DELURAM [1997] 224 ITR 610 (SC) . THE APE X COURT HAS HELD THAT THE SCOPE OF POWERS OF AAC IS COTERMINOUS WITH THOSE OF THE ITO. HE CAN DO WHAT THE ITO CAN DO AND ALSO DIREC T HIM TO DO WHAT HE HAS FAILED T O D O . 5.6 RECENTLY THE HON ' BLE GUJARAT HIGH COURT IN THE CASE OF CIT V MITESH IMPLEX [2014] 367 ITR 85 (GUJ), HAS CATEGO RICALLY HELD THAT NEW CLA I M CAN BE RAISED BEFORE THE CIT(A) OR T RIBUNAL FOR THE FIRST TIME. THE DELHI HIGH COURT ALSO HAS HELD SIMILAR VI EW IN THE CASE OF CIT V JAI PARABOLIC SPRINGS LTD [2008] 306 I TR 42 (DEI). A COPY OF 6 JUDGMENT OF THE DELHI HIGH COURT I S PLACED AT PAGES 35 TO 37 OF THIS PAPER BOOK. 5.7 THIS ISSUE HAS BEEN CONSIDERED RECENTLY BY THE BOMB AY HIGH COURT IN THE CASE OF CIT V P R U THVI BROKERS AND SHAREHOLDERS P LTD [2012] 349 ITR 336 (BOM). THE HON'BL E COURT HAS H ELD THAT THE ASSESSEE IS ENTITLED TO RAISE NOT MERELY ADDITIONAL LEGAL SUBMISSION S BEFORE THE APPELLATE AUTHORITIES BUT IS ALSO ENTIT L ED TO RAISE ADDITIONAL CLAIM BEFORE THEM . THE APPELLATE A UTHORITIES HAVE THE DISCRETION TO PERMI T SUCH ADDITIONAL CLAIM TO BE RAISED. A C OPY OF THIS JUDQMENT IS PLACED AT PAGES 38 TO 47 . 5.1 I HAVE CONSIDERED THE SUBM I SSIONS MADE AND FIND THAT THE ISSUE REGARDING ADMISSION OF NEW AND ADDITIONAL CLA IM BY THE APPELLATE AUTHORITIES, WHICH MIGHT NOT HAVE BEEN C LAIMED IN THE RETURN OF INCOME THROUGH INADVERTENCE, HAS BEEN ANS WERED IN THE AFFIRMATIVE BY SEVERAL JUDGMENTS OF THE SUPREME COU RT AND HIQH COURTS. THE OBSERVATIONS OF THE SUPREME COURT IN JU TE CORPORATION INDIA LTD. (187 ITR 688) AND IN GURJARQRAVURES (P) LTD. (111 ITR 1), THE DELH I HIGH COURT IN JAI PARABOLIC SPRINQS LTD. (306 ITR 4 2) AND BOMBAY HIGH COURT IN THE CASE OF PRUTHVI BROKERS AN D SHA R EHOLDERS (349 ITR 336) ARE TO THE E FFECT THAT W HERE THERE IS A GENUINE ERROR O N THE PART OF AN ASSES S EE IN NOT CLAIMING DEDUCTION IN RETURN OF INCOME AND THERE IS NO FINDING THAT THE CLAIM MADE IS MALAFIDE, AN ADDITIONAL CLAIM OF THE ASSESSEE MAY BE ENTERTAINED BY THE A P PELLATE AUTHORITIES. THE CLAIM MADE BY THE APPELLAN T RELATES TO PAYMENT OF T DS INTO THE GOVT. ACCOUNT BEFORE THE FI L ING OF RETURN. THE FACT THAT THERE WAS A B E L ATED PAYMENT OF TDS WAS MENTIONED IN THE AUDIT REPORT IN COLUMN 17(F) AND ALSO COLUMN 27 (A). SINCE THE TIME OF FILING OF A REVISED RETURN WAS OVER, THE AP PELLANT REQUESTED THE ASSESS IN G OFFICER BOTH DURING THE ORIGINAL ASSESSMENT PROCEEDINGS AND SUBSEQUENT REASSESSMENT PROCEEDING CONSEQUENT TO SEE . 263, T O GRANT DEDUCTION FOR AN AMOUNT OF RS.36,79,391/ - WHICH WAS PAID PRIOR TO THE C L UE DATE OF FILING RETURN U/S 139(1). THEREFORE ALL THE FACTS AND PARTICULARS ARISE FROM THE PRIOR PROCEEDINQS AND WERE BEFORE THE ASSESSING OFFICER. ACCORDINGLY, T H E GROUND RAISED BY THE APPELLANT IS PERMITTED TO BE R AISED. 5.1.1 COMING TO THE MERITS OF THE GROUND RAISED, T HE PROVISION OF SECTIONS OF 40(A)(IA) FOR THE RELEVANT YEAR PROVIDE FOR ALLOWAN CE OF THE CLAIM IN THE YEAR I N WHICH THE TAX DEDUCTED AT SOURCE , IS PAID INTO GOVT. ACCOUNT . THE PROVISION OF THE STATUTE FOR THE RELEVANT ACCOUNTING PERIOD READS AS UNDER: (IA) ANY INTEREST, COMMISSION OR BROKERAGE, [RENT, ROYALTY ,] FEES FOR PROFESSIONAL SERVICES OR FEES FOR TECHNICA L SERVICES PAYABLE TO A RESIDENT, OR AMOUNTS PAYABLE TO A CON T R ACTOR OR SUB-CONTRACTOR, BEING RESIDENT, FOR CARRYING ' OUT ANY WORK ( I NCLUDING SUPPLY OF LABOUR FOR CARRYING OUT ANY WOR K), ON WHICH TAX IS DEDUCTIBLE AT SOURCE UNDER CHAPT ER XVII-B AND SUCH TAX HAS NOT BEEN DEDUCTED OR, AFTER DEDUCTION, HAS NOT BEEN PAID DURING THE PREVIOUS YEAR, OR IN THE SUBSE QUENT YEAR BEFORE THE EXPIRY OF THE TIME PRESCRIBED UNDER SUB- SECTION (1) OF SECTION 200 : ' PROVIDED THAT WHERE IN RESPECT OF ANY SUCH SUM, TAX HAS BEEN DEDUC T ED IN A NY SUBSEQUENT YEAR OR, HAS BEEN DEDUCTED IN THE 7 PREVIOUS YEAR BUT PAID IN ANY SUBSEQU E NT YEAR AFTER THE EXPIRY OF THE TIME PRESCRIBED UNDER SUB-SECTION (1) OF SECTIO N 200, SUCH SUM SHALL BE ALLOWED AS A DEDUCTION IN COMPUTING THE IN COME OF THE PREVIOUS YEAR IN WHICH SUCH TAX HAS BEEN PAID. 5.1 . 2 AS A RESULT OF THE AMENDMENT IN THE STATUTE BY TH E FINANCE ACT 2010 W.E . F. 01 . 04.2010 THE SECTION WAS AMENDED WHEREIN, WITH RESPECT TO ANY OF THE SUMS ON WHICH TAX IS DED UCTIBLE BUT HAS NOT BEEN DEDUCTED OR AFTER DEDUCTION HAS NOT BEEN P AID ON OR BEFORE THE DUE DATE SPECIFIED IN SUB-SEE . (1) OF SECTION 139, THE AMOUNT IS NOT ALLOWABLE. THE PROVISO TO SEC. 40(A)(IA) WAS IN T RODU C ED FROM THE SAME DATE TO PROVIDE THAT, WHEREIN WITH RESPECT TO ANY OF THE SUMS ON WHICH TAX HAS BEEN DEDUCTED DURING THE PREVIOUS YEAR BUT PAID AFTER THE D UE DATE SPECIFIED IN SUB-SEC. (1) OF SECTION 139, S UCH SUM SHALL BE ALLOWED A S A DEDUCTION IN COMPUTING THE INCOME OF THE PREVIOUS YEAR IN WHICH SUCH , T AX HAS BEEN PAID. ALTHOUGH THE AMENDMENT HAS COME INTO EFFECT FROM THE AS S ESSMENT YEAR 2010- 11, SEVERAL HIGH COURTS HAVE NOW HELD THAT THE AMEN DMENT HAS RETROSPECTIVE EFFECT. THE DECISIONS OF THE HIGH COU RTS BEING AS UNDER: ( I ) CITVS CRESCENT EXPORT SYNDICATE (216 TAXMAN 258)( CAL . ) (II) CITVS SANTOSH KUMAR SHETTY (227 TAXMAN 170) (K ARN.) (III) CIT VS B.M.S. PROJECTS (P.) LTD. (44 TAXRNANN .CORN 06)(GUJ.) 5.1 . 3 SO FAR AS THE EFFECT OF THE AMENDMENT TO SEC. 4 0(A)(IA) BY THE FINANC E ACT, 2008 RETROSPECTIVELY W.E.F. 01 . 04.2005 IS CONCERNED, SEVERAL CO U RTS HAV E ALSO HELD WHERE TAX IS DEDUCTED AND DEPOSITED WITHIN DATE SPECIFIED U/S 139(1 ),T HE SAME CANNOT BE DISALLOWED. THESE ARE KARNATAKA HIGH COURT IN ANIL KUMAR & C O. (214 TAXMAN 202), DELHI HIGH COURT IN NARESH KUMAR (39 TAXMANN. COM H12) AND RAJINDER KUMAR (39 TAXMANN.COM 126), J&K HIGH COURT IN J & K COOPERATIVE HOUSING CORPORATION LTD. (43 TAXMANN.CO M 149), RAJASTHAN HIGH COURT IN CHOUDHARY CONSTRUCTION COMP ANY (42 TAXMANN.COM 547) AND GUJARAT HIGH COURT IN ROYAL BU ILDERS (40 TAXMANN.COM 464). 5 . 1.4 THERE IS ONLY ONE CONTRARY DECISION OF THE SPEC IAL BENCH BOMBAY TRIBUNAL IN THE CASE OF BHARATI SHIPYARD (13 2 ITD 53) STATING THAT ORDINARILY, A S U BSTANTIVE PROVISION IS 'PROSPECTIVE' IN OPERATION AND COURTS CANNOT GIVE IT R E TROSPECTIVE EFFECT' EXCEPT IN LIMITED CIRCUMSTANCES WHERE, SAY, THE AMENDMENT MAKE S EXPLICIT WHAT WAS EARLIER IMPLICIT OR WHERE THE AMENDMENT W AS TO REMOVE UNINTENDED CONSEQUENCES IN THE EXISTING PROVISION A ND TO MAKE IT WORKABLE. A PROVISION GIVING RELIEF CANNOT BE REGAR DED AS RETROSPECTIVE ONLY BECAUSE THE OR I GINAL PROVISION CAUSED HARDSHIP TO THE ASSESSEE. S.40(A)(I) CAUSED INTENDED DIFFICUL TY' WITH THE OBJECT OF DISCOURAGING NON-COMPLIANCE WITH THE TDS PROVISI ONS. A PARTIAL RELAXATION IN ITS RIGOR, INSERTED WITH PROSPECTIVE EF F ECT, CANNOT BE TREATED AS ' R ETROSPECTIVE'. 5.1 . 5 YET IN VIEW OF THE OVERWHELMING NUMBER OF HIGH CO URT DECISIONS TO THE CONTRARY HOLDING THAT THE AMENDMENT INTRODUCED IN SEC.40(A)(IA) ARE RETROSPECTIVE, IT I S FOUND APPROPRIATE TO ISSUE DIRECTIONS TO THE ASSESSING OFFICER TO VERIFY AND A LLOW THOSE AMOUNTS ON WHICH TDS HAS BEEN DEPOSITED IN THE GO V T. ACCOUNT 8 PRIOR TO THE DUE DATE OF FILING THE RETURN OF INCOM E FOR THE IMPUGNED YEAR. GROUND NO.2 IS TREATED AS ALLOWED TO THIS LIMI TED EXTENT. AGGRIEVED BY THE ORDER OF LD.CIT(A) REVENUE IS NOW IN APPEAL BEFORE US. 9. BEFORE US, LD. D.R. SUPPORTED THE ORDER OF AO AND SUBMITTED THAT LD.CIT(A) HAS ERRED IN DIRECTING THE AO TO VERIFY THE CLAIM OF PAYMENT OF TDS BY THE ASSESSEE WHICH IS NOT SUPP ORTED BY THE REVISED RETURN IN CONTRAVENTION OF HONBLE SUPREME COURT DECISION IN THE CASE OF GOETZE (I) LTD., VS. CIT REPORTED IN 284 ITR 323. ON THE OTHER HAND, LD.A.R REITERATED THE SUBMISSIONS MADE BEFORE AO AND LD. CIT(A) AND FURTHER SUBMITTED THAT ASSESS EE HAD ALREADY DEPOSITED THE TDS BEFORE THE DUE DATE OF FILING THE RETURN AND SINCE THE TIME LIMIT FOR FILING THE REVISED RETURN HAD LAPSED, THE REQUEST WAS MADE BEFORE LD.CIT(A) WHO HAS RIGHTLY ALLOWED THE CLAIM OF THE ASSESSEE. HE THUS SUPPORTED THE ORDER OF LD.CIT(A). 10. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. IN THE PRESENT CASE, THERE IS NO DISP UTE THAT ASSESSEE HAD DEDUCTED THE TDS AND THE SAME WAS DEPO SITED IN THE GOVERNMENT ACCOUNT BEFORE THE DUE DATE OF FILING OF RETURN OF INCOME. THE AFORESAID FACT HAS BEEN CONFIRMED BY THE AUDIT OR IN THE TAX AUDIT REPORT AND THERE IS ALSO A FINDING OF THE LD .CIT(A) TO THAT EFFECT. LD.CIT(A) HAD ALLOWED THE CLAIM OF THE ASSESSEE BY FOLLOWING THE DECISIONS CITED BY HIM IN THE ORDER. WE FURTHER FIND THAT LD.CIT(A) HAD FOLLOWED THE DECISION OF HONBLE BOMBAY H IGH COURT IN THE CASE OF CIT VS. PRUTHVI STOCK AND SHAREH OLDERS (P) LTD., REPORTED IN 349 (ITR) 336, WHEREIN HONBLE HIGH COURT HAS 9 HELD THAT WHEREIN THERE WAS A GENUINE ERROR ON THE PA RT OF THE ASSESSEE IN NOT CLAIMING DEDUCTION IN THE RETURN OF INCOME AND WHEN THE CLAIM OF ASSESSEE IS NOT MALAFIDE, THE APPELLATE A UTHORITY CAN ENTERTAIN THE CLAIM OF ASSESSEE. BEFORE US, REVENUE HAS NOT PLACED ANY MATERIAL ON RECORD TO DEMONSTRATE THAT THE FINDINGS OF LD.CIT(A) WAS INCORRECT OR THE RELIANCE PLACED BY LD.CIT(A) ON THE DECISIONS CITED IN THE ORDER WAS NOT CORRECT. IN SUCH A SITUATION, WE DO NOT FIND ANY ERROR IN THE ORDER OF LD.CIT(A). THUS, THE GROUNDS OF REVENUE IS DISMISSED. 11. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISMISS ED. ORDER PRONOUNCED ON 7 TH DAY OF JULY, 2017. SD/- SD/- ( SUSHMA CHOWLA ) ( ANIL CHATURVEDI ) ! / JUDICIAL MEMBER '! / ACCOUNTANT MEMBER PUNE; ! DATED : 7 TH JULY, 2017. YAMINI #$%&'('% / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3. 4. 5. 6. CIT(A)-II, PUNE. CIT-2, PUNE. #$% &&'(,* '(, / DR, ITAT, A PUNE; %+,-/ GUARD FILE. / BY ORDER, // TRUE COPY // . /012 / ASSISTANT REGISTRAR, * '( , / ITAT, PUNE. /