Smt. Kanta Yadav, New Delhi V. ITO, Gurgaon

ITA 6312/DEL/2016

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 3164 (ITAT-DELHI)
• Duration Of Justice: 5 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-05-2017
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: D
• Next Hearing Date: 08-05-2017
• Assessment Year: 2012-2013
• Appeal Filed On: 09-12-2016
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL

Judgement Text

PAGE 1 OF 4 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH - D NEW DELHI BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND SHRI B.P. JAIN, ACCOUNTANT MEMBER ITA NO. 6312/DEL/20 16 ASSESSMENT YEAR : 2012-13 SMT. KANTA YADAV, PROP. M/S. YADAV TRAVELS BUILDING NO. 117, DLF PHASE-II, RAPID METRO STATION, DLF CYBER CITY OPPOSITE BUILDING NO. 5, GURGAON VS. ITO WARD-2 (2) GURGAON (APPELLANT) (RESPONDENT) PER BHAVNESH SAINI, JUDICIAL MEMBER ORDER THIS APPEAL BY THE ASSESSEE HAS BEEN DIRECTED AGAI NST THE ORDER OF LD. CIT(A)-1, GURGAON DATED 30 TH NOVEMBER, 2016 FOR ASSESSMENT. YEAR 2012-13 CHALLENGING THE DISALLOWANCE OF RS. 49 ,81,831/- ON ACCOUNT OF NON DEDUCTION OF TDS U/S 40 (A) (IA) OF THE I.T. ACT. ASSESSEE BY : DR. RAKESH GUPTA, SHRI SOMIL AGRAWAL, ADVOCATE DEPARTMENT BY: SHRI SHAILESH THAKUR, SR. DR DATE OF HEARING 08/05/2017 DATE OF PRONOUNCEMENT /05/2017 ITA NO. 6312/DEL/2016 SMT. KANTA YADAV VS. ITO PAGE 2 OF 4 2. THE ASSESSING OFFICER NOTED THE DURING THE YEAR ASSESSEE IS RUNNING PROPRIETY BUSINESS NAMED AS M/S. YADAV TRA VELS HAD HIRED BUSES AND PAID HIRE CHARGES AMOUNTING TO RS. 49,81, 831/- WITHOUT DEDUCTING TAX AT SOURCE. THE ENTIRE AMOUNT WAS THER EFORE DISALLOWED. LD. CIT(A) DISMISSED THE APPEAL OF ASSESSEE BECAUSE ASSESSEE HAS FAILED TO DEDUCT ANY TDS ON THIS EXPENDITURE. 3. WE HAVE HEARD LD. REPRESENTATIVES OF BOTH THE PA RTIES AND PERUSED THE MATERIAL ON RECORD. 4. LD. COUNSEL FOR ASSESSEE THOUGH RAISED SEVERAL G ROUNDS OF APPEAL, HAS RESTRICTED HIS ARGUMENT TO ONE POINT ONLY THAT ADDITION MAY BE RESTRICTED TO 30% OF THE TOTAL ADDITION AS PER AMEN DMENT IN SECTION 40(A)(IA) OF THE ACT. IN SUPPORT OF ITS CONTENTION HE HAS RELIED UPON ORDER OF THE ITAT, JAIPUR BENCH IN THE CASE OF SHRI RAJEN DRA YADAV VS. ITO IN ITA NO. 895/JP/2012 ASSESSMENT YEAR 2007-08 DATED 2 9 TH JANUARY, 2016 IN WHICH IN PARA 6.1 AND 7, THE APPEAL OF THE ASSES SEE HAS BEEN PARTLY ALLOWED ON THIS ISSUE. THE SAME PARAS ARE REPRODUCE D AS UNDER :- 6.1 RECENTLY IN THE MATTER OF P.M.S. DIESELS 2015 59 TAXMANN.COM 100 (PUNJAB & HARYANA) , HON'BLE PUNJAB & HARYANA HIGH COURT HAD ELABORATELY DISCUSS ED THE JUDGMENT PASSED BY THE HON'BLE CALCUTTA HIGH CO URT AND HON'BLE GUJARAT HIGH COURT, HON'BLE ALLAHABAD H IGH COURT AND OTHER JUDGMENTS AS AVAILABLE AND THEREAFT ER HAS COME TO THE CONCLUSION THAT THE PROVISIONS OF SECTI ON 40(A)(IA) ARE MANDATORY IN NATURE AND NON COMPLIANC E / NON DEDUCTION OF TAX ATTRACTS DISALLOWANCE OF THE E NTIRE AMOUNT . HAVING SAID SO, WE WILL BE FAILING IN OUR DUTY IF WE DO NOT DISCUSS THE AMENDMENT BROUGHT IN BY THE FINA NCE (NO.2) ACT 2014 WITH EFFECT FROM 1.4.2015 BY VIRTUE OF WHICH PROVISO TO SECTION 40(A)(IA) HAS BEEN INSERTE D, WHICH PROVIDES THAT IF ANY SUCH SUM TAXED HAS BEEN DEDUCT ED IN ANY SUBSEQUENT YEAR OR HAS BEEN DEDUCTED DURING THE PREVIOUS YEAR BUT PAID AFTER THE DUE DATE SPECIFIED IN SUB- ITA NO. 6312/DEL/2016 SMT. KANTA YADAV VS. ITO PAGE 3 OF 4 SECTION (1) OF SECTION 139, SUCH SUM SHALL BE ALLOW ED AS A DEDUCTION IN COMPUTING THE INCOME OF PREVIOUS YEAR , SUCH SUM SHALL BE ALLOWED AS A DEDUCTION IN COMPUTING TH E INCOME OF PREVIOUS YEAR, AND FURTHER, SECTION 40(A) (IA) HAS BEEN SUBSTITUTED WHEREIN THE 30% OF ANY SUM PAYABLE TO A RESIDENT HAS BEEN SUBSTITUTED. IN THE PRESENT CASE, THE AUTHORITIES BELOW HAS ADDED THE ENTIRE SUM OF RS. 7,51,322/- BY DISALLOWING THE WHOLE OF THE AMOUNT. THOUGH THE SUBSTITUTION IN SECTION 40 HAS BEEN MADE EFFECT IVE WITH EFFECT FROM 1.4.2015, IN OUR VIEW THE BENEFIT OF TH E AMENDMENT SHOULD BE GIVEN TO THE ASSESSEE EITHER BY DIRECTING THE ASSESSING OFFICER TO CONFIRM FROM THE CONTRACTORS, NAMELY, M/S. GARVIT STONEX, M/S. CHAND A MARBLES AND M/S. NIDHI GRANITES AS TO WHETHER THE S AID PARTIES HAVE DEPOSITED THE TAX OR NOT AND FURTHER O R RESTRICT THE ADDITION TO 30% OF RS. 7,51,322/-. IN OUR VIEW, IT WILL BE TIED OF JUSTICE IF THE DISALLOWANCE IS ONLY REST RICTED TO 30% OF RS. 7,51,322/-. ACCORDINGLY, THE APPEAL OF T HE ASSESSEE IS PARTLY ALLOWED IN THE ABOVE SAID MANNER . 7. IN THE RESULT, APPEAL OF THE ASSESSEE IS PARTLY ALLOWED. 5. HE HAS FURTHER SUBMITTED THAT SAID ORDER HAS BEE N FOLLOWED BY ITAT JAIPUR BENCH IN THE CASE OF SMT. SONU KHANDELW AL VS. ITO IN ITA NO. 597/JP/2013 DATED 13 TH MAY, 2016. HE HAS THEREFORE SUBMITTED THAT DISALLOWANCE MAY BE RESTRICTED TO 30% OF THE TOTAL DISALLOWANCE. ON THE OTHER HAND LD. DR RELIED UPON ORDERS OF THE AUTHORI TIES BELOW. 6. WE HAVE CONSIDERED RIVAL SUBMISSIONS AND FIND TH AT ISSUE IS COVERED IN FAVOUR OF THE ASSESSEE BY ORDER OF ITAT JAIPUR BENCH IN THE CASE OF SHRI RAJENDRA YADAV VS. ITO AND SMT. SONU KHANDELWAL VS. ITO. IN THESE ORDERS IT WAS HELD THAT THE DISALLOWANCE U /S 40(A)(IA) TO BE RESTRICTED TO 30% OF THE ADDITION. IN THESE ORDERS THE TRIBUNAL HAS CONSIDERED THE AMENDED PROVISIONS OF SECTION 40(A)( IA) OF I.T. ACT. IN THESE ORDERS THE ASSESSMENT YEARS INVOLVE WAS 2007 -08 AND 2008-09. IN ITA NO. 6312/DEL/2016 SMT. KANTA YADAV VS. ITO PAGE 4 OF 4 THE PRESENT APPEAL THE ASSESSMENT YEAR IS 2012-13. THEREFORE FACTS ARE IDENTICAL. IN THIS VIEW OF THE MATTER AND FOLLOWING THE ABOVE DECISIONS OF JAIPUR BENCH, WE SET ASIDE AND MODIFY THE ORDERS OF THE AUTHORITIES BELOW AND DIRECT THE ASSESSING OFFICER TO RESTRICT THE ADDITION TO 30% OF THE TOTAL ADDITION MADE ON ACCOUNT OF DEDUCTION OF TDS U/S 40(A)(IA) OF THE ACT. 7. IN THE RESULT, APPEAL OF ASSESSEE IS PARTLY A LLOWED. PRONOUNCED IN THE OPEN COURT. SD/- SD/- (B.P. JAIN) ( BHAVNESH SAINI ) ACCOUNTANT MEMEBR JUDICIAL MEMBER DATED: 12/05/2017 *VEENA* COPY FORWARDED TO: - 1. APPELLANT 2. RESPONDENT 3. PRINCIPAL CIT 4. CIT(A) 5. DR, ITAT TRUE COPY BY ORDER, ASSISTANT REGISTRAR