The ITO, Ward-9(1), Ahmedabad V. Shri Praful Kantilal Shah, Ahmedabad

ITA 66/AHD/2013

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 0566 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-02-2013
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2008-2009
• Appeal Filed On: 07-01-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAHUL KUMAR

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AT AHMEDABAD A BENCH BEFORE: SHRI D.K. TYAGI JUDICIAL MEMBER AND SHRI A. MOHAN ALANKAMONY, ACCOUNTA NT MEMBER ITO WARD. 9(1), AHMEDBAD (APPELLANT) VS. SHRI PRAFUL KANTILAL SHAH 8, SHAISHAV KARNAVATI SOCIETY, BHAIRAVNATH, MANINAGAR, AHMEDABAD (RESPONDENT) PAN:-AJJPS6944H REVENUE BY : SRI RAHUL KUMAR, SR. D.R. ASSESSEE BY : NONE DATE OF HEARING : 28-02-2013 DATE OF PRONOUNCEMENT : 28-02-2013 / ORDER PER : D.K TYAGI, JUDICIAL MEMBER:- THIS IS THE REVENUES APPEAL AGAINST THE ORDER OF L D. CIT(A)-XV, AHMEDABAD DATED 4 TH OCTOBER, 2012. 2. NONE APPEARED ON BEHALF OF THE ASSESSEE DESPITE THE FACT THAT NOTICE FOR TODAYS HEARING WAS SERVED UPON THE ASSESSEE. WE PROCEEDED TO DISPOSE I.T.A. NO. 66/AHD/2013 A.Y.:-2008-09 ITA NO. 66/AHD/2013 A.Y. 2008-09 PAGE NO ITO VS. PRAFUL KANTILAL SHAH 2 OF THIS APPEAL BY HEARING LD. D.R. THE REVENUE IN THIS APPEAL IS AGGRIEVED BY THE ACTION OF LD. CIT(A) IN DELETING THE ADDITIO N OF RS. 31,75,516/- MADE ON ACCOUNT OF TRANSPORTATION EXPENSES U/S 40(A)(IA) OF THE ACT. THE ASSESSING OFFICER WHILE MAKING ADDITION OF RS. 31,7 5,516/- ON ACCOUNT OF TRANSPORTATION EXPENSES U/S 40(A)(IA) HAS OBSERVED AS UNDER:- (C) IT IS OBSERVED BY A.O. THAT ASSESSEE HAD MADE PAYMENT TO VARIOUS SUB CONTRACTORS ON DIFFERENT DATES UP TO 29 /02/08 AND DEDUCTED TAX A SOURCE BUT SAME HAS NOT BEEN DEPOSIT ED IN THE GOVERNMENTS ACCOUNT WITHIN THE PRESCRIBED TIME U/S 220(1) OF THE ACT FOR THE FOLLOWING PAYMENTS/CREDITS- SR. NO . NAME OF THE PARTY AMOUNT PAID/CREDI TED DATE OF PAYMENT/CRE DITED DT. OF TAX DEDUCTION AMT. OF TDS DT. OF DEPOSIT 1 SHRI DASHRA T 1,06,304 01/01/2008 01/01/2008 1,204 31/05/2008 DO 1,94,749 01/02/2008 01/02/2008 2,240 31/05/2008 DO 3,60,949 29/02/2008 05/03/2008 4,090 31/05/2008 2 M/S SHAMBI O PVT. LTD. 1,77,400 31/01/2008 31/01/2008 2,010 31/05/2010 DO 5,21,553 29/02/2008 29/02/2008 5,909 31/05/2008 3 PANKAJ S. PATEL 8,54,898 31/01/2008 31/01/2008 9,686 31/05/2008 DO 9,56,663 29/02/2008 29/02/2008 10,83 9 31/05/2008 TOTAL 31,75,516 (D) VIDE A.O.S OFFICE LETTER DATED 11/10/2010, THE ASSESSEE WAS SHOW CAUSED AS TO WHY THE SAID AMOUNT RS. 31,75,516 /- SHOULD NOT BE ITA NO. 66/AHD/2013 A.Y. 2008-09 PAGE NO ITO VS. PRAFUL KANTILAL SHAH 3 DISALLOWED U/S. 40(A)(IA) OF THE ACT AND ADDED TO T HE INCOME OF THE ASSESSEE. (E) THE APPELLANT VIDE SUBMISSION DATED 16.11.2010 CONTENDED THAT- TDS CONTRACT/SUB-CONTRACT PAYMENT MADE ON 31/05/20 08 BECAUSE OF DURING THE MONTH WE HAVE NOT RECEIVED ANY PAYMENT FROM PARTY BANK LIMIT SANCTION TONALLY UTILIZED, MARCH ROUTINE EXPE NSES LIKE SALARY, SITE PREPARATION, DIESEL EXPENSES, MACHINERY REPAIRING W AS HUGE AND WITHOUT THAT BUSINESS DISTURBED. MOREOVER BILL FOR THE MONTH OF MARCH RAISED PAYMENT RECEIVED IN THE MONTH OF MAY E NDING AND IN THE JUNE. EVEN THOUGH WE HAVE PAID UNPAID TDS OF RS. 4 5,378/- +INTEREST RS. 1267=RS. 46,645 DTD. 31/05/2008 (F) THE ABOVE REPLY OF THE ASSESSEE IS BEING CONSID ERED BY A.O. BUT NOT ACCEPTED BECAUSE FROM THE BANK STATEMENTS SUBMI TTED BY THE ASSESSEE REVEAL THE TRUE FINANCIAL CONDITION AND HE NCE, HE COULD HAVE MANAGED HIS AFFAIRS IN A VERY HEALTHY MANNER. THE PAYMENTS TO GOVERNMENT ACCOUNT ARE PRESCRIBED BY THE STATUTE AN D ARE MANDATORY. IT IS CLEAR FROM THE ABOVE THAT THE ASSESSEE HAD MA DE PAYMENTS TO SUB CONTRACTOR, HAS DEDUCTED TAX AT SOURCE FROM SUCH PA YMENTS MADE, BUT HAS NOT DEPOSITED THE TDS AMOUNT IN THE GOVERNMENT S ACCOUNT WITHIN THE TIME PRESCRIBED, AS PER PROVISION CONTAI NED IN CHAPTER XVIIB, AND HENCE VIOLATED THE PROVISIONS OF SECTION 40(A)(IA) OF THE ACT. ACCORDINGLY, THE AMOUNT OF RS. 31,75,516/- IS LIABLE TO BE DISALLOWED. THEREFORE, THE AMOUNT OF RS. 31,75,516 /- IS ADDED TO THE TOTAL INCOME OF THE ASSESSEE U/S. 40(A)(IA) OF THE ACT. 3. LD. CIT(A) AFTER TAKING INTO CONSIDERATION THE S UBMISSION OF THE ASSESSEE DELETED THIS ADDITION BY OBSERVING AS UNDE R:- 5.1 GROUND NO. 1 IS RELATED TO LATE DEDUCTION OF T DS OF RS. 31,75,516. IN FACT THE ISSUE IS RELATED TO LATE DE POSIT OF TDS AS PER PRESCRIBED TIME LIMIT U/S. 200(1) OF THE IT ACT. I AM INCLINED TO ACCEPT THE CONTENTION OF THE APPELLANT THAT IN VIEW OF VAR IOUS JUDGMENT AS RELIED ON BY APPELLANT VIZ. VIRGIN CREATION OF HON BLE CULCUTTA HIGH COURT, KANUBHAI RAMJIBHAI MAKWANA OF HONBLE ITAT A HMEDABAD, IT IS NOW SETTLED THAT AMENDMENT BROUGHT INTO SECTI ON 40(A)(IA) OF THE ACT VIDE FINANCE ACT 2010 W.E.F. 1.4.2010 ARE CURAT IVE AND RETROSPECTIVE HENCE IF TDS DEDUCTION IS PAID/DEPOSI TED BEFORE DUE ITA NO. 66/AHD/2013 A.Y. 2008-09 PAGE NO ITO VS. PRAFUL KANTILAL SHAH 4 DATE OF FILING OF RETURN OF INCOME U/S 139(1) OF TH E ACT IT DOES NOT INVITE THE PROVISION OF SECTION 40(A)(IA) OF THE AC T. IN THE CASE OF APPELLANT, THE A.O. ALSO AGREED THAT SUCH DEDUCTED TDS WAS PAID/DEPOSITED BY APPELLANT BEFORE FILING OF RETURN OF INCOME HENCE A.O. IS DIRECTED TO ALLOW SUCH EXPENDITURE AND DELE TE THE ADDITION SO MADE U/S. 40(A)(IA) OF THE ACT. THE APPELLANT GETS RELIEF ACCORDINGLY. 4. SINCE LD. CIT(A) HAS GIVEN RELIEF TO THE ASSESSE E BY PLACING RELIANCE ON THE DECISION OF CULCUTTA HIGH COURT AND THE DECI SION OF THIS BENCH OF THE TRIBUNAL, WE FEEL NO NEED TO INTERFERE WITH THE ORD ER PASSED BY HIM AND THE SAME IS HEREBY UPHELD. 5. IN THE RESULT, REVENUES APPEAL IS DISMISSED. ORDER PRONOUNCED IN OPEN COURT ON THE DATE MENTIONE D HEREINABOVE AT CAPTION PAGE SD/- SD/- (A. MOHAN ALANKAMONY) (D. K. TYAGI) ACCOUNTANT MEMBER JUDICIAL MEMBER AHMEDABAD : DATED 28 /02/2013 A.K. / COPY OF ORDER FORWARDED TO:- 1. / APPELLANT 2. / RESPONDENT 3. / CONCERNED CIT 4. - / CIT (A) 5. , ! , '# / DR, ITAT, AHMEDABAD 6. $% &' / GUARD FILE. BY ORDER/ , ( / ' ) ! , '#