D.J. INDUSTRIES, MUMBAI V. ITO WD 18(1)(3), MUMBAI

ITA 6768/MUM/2016

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 0375 (ITAT-MUMBAI)
• Duration Of Justice: 7 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-06-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2012-2013
• Appeal Filed On: 18-11-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: T A KHAN
• Keywords: Retrospective amendment
• Section: 201(1)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES SMC, MUMBAI BEFORE SHRI B R BASKARAN, ACCOUNTANT MEMBER ITA NO.6768/MUM/2016 ASSESSMENT YEAR : 2012-13 D J INDUSTRIES 210, 2 ND FLOOR, KONARKSHRAM, 156 TARDEO ROAD, MUMBAI 400 034 PAN AAFD0966A VS. ITO WARD 18(1)(3) MUMBAI (APPELLANT) RESPONDENT) APPELLANT BY : MS. DINKLE HARIA RESPONDENT BY : SHRI T A KHAN DATE OF HEARING : 20.06.2017 DATE OF PRONOUNCEMENT : 20 .06.2017 O R D E R THE ASSESSEE HAS FILED THIS APPEAL CHALLENGING THE ORDER DATED 19-09-2016, PASSED BY LD CIT(A)-29, CONFIRMING THE ADDITION OF ` 38,26,301/- MADE BY THE AO U/S 40(A)(IA) OF THE ACT FOR NON-DEDUCTIO N OF TAX AT SOURCE FROM THE INTEREST PAYMENTS FOR AY 2012-13. 2. I HEARD THE PARTIES AND PERUSED THE RECORD. THE AO NOTICED THAT THE ASSESSEE HAS PAID INTEREST OF ` .38,170/- AND ` .37,88,131/- RESPECTIVELY TO M/S TATA FINANCE AND M/S RELIGARE FINVEST LTD WITHOUT DEDUCTING TAX AT SOURCE U/S 194A OF THE ACT. HENCE THE AO DISALLOWED THE ABOVE INTEREST EXPENSES BY INVOKING THE PROVISIONS OF SEC. 40(A)(IA) OF THE ACT. THE LD CIT(A) ALSO CONF IRMED THE SAME. 2 ITA NO.6768/MUM/2016 D J INDUSTRIES 3. THE PLEA OF LD A.R IS THAT THE AMENDMENT BROUG HT BY FINANCE ACT, 2012 BY INSERTING SECOND PROVISO IN SEC. 40(A)(IA) W.E.F. 1 .4.2013 IS HELD TO BE RETROSPECTIVE IN NATURE BY HONBLE DELHI HIGH COURT IN THE CASE O F CIT VS. ANSAL LANDMARK TOWNSHIPS (P) LTD (2015)(377 ITR 635). SHE SUBMITT ED THAT A CONTRARY VIEW HAS BEEN TAKEN BY HONBLE KERALA HIGH COURT IN THE CASE OF THOMAS GEORGE MUTHOOT VS. CIT (2015)(63 TAXMANN.COM 99). SINCE THE DECISION RENDERED BY HONBLE DELHI HIGH COURT IS FAVOURABLE TO THE ASSESSEE, THE SAME SHOUL D BE ADOPTED AS HELD BY RAIPUR BENCH OF TRIBUNAL IN THE CASE OF RKP COMPANY VS. IT O (2016)(71 TAXMANN.COM 257)(RAIPUR- TRIB) BY FOLLOWING THE DECISION RENDER ED BY HONBLE SUPREME COURT IN THE CASE OF CIT VS. VEGETABLE PRODUCTS LTD (1972)(8 8 ITR 192). 4. THE LD A.R SUBMITTED THAT THE RECIPIENTS HAVE FILED RETURN OF INCOME FOR THE YEAR UNDER CONSIDERATION AND ACCORDINGLY PLEADED THAT NO ADDITION IS CALLED FOR AS PER THE SECOND PROVISO TO SEC. 40(A)(IA) OF THE ACT. 5. ON THE CONTRARY, THE LD D.R PLACED STRONG REL IANCE ON THE ORDER PASSED BY LD CIT(A). 6. HAVING HEARD RIVAL SUBMISSIONS, I FIND MERIT I N THE SUBMISSIONS OF LD A.R. IN THE ABSENCE OF JURISDICTIONAL HIGH COURTS DECISION AND IN THE CASE OF CONTRARY VIEWS EXPRESSED BY OTHER HIGH COURTS, THE VIEW IN FAVOUR OF THE ASSESSEE HAS TO BE ADOPTED AS PER THE DECISION RENDERED BY HONBLE SUP REME COURT IN THE CASE OF VEGETABLE PRODUCTS LTD (SUPRA). ACCORDINGLY I HOLD THAT THE DECISION RENDERED BY HONBLE DELHI HIGH COURT IN THE CASE OF ANSAL LANDM ARK TOWNSHIPS P LTD HAS TO BE FOLLOWED IN THE PRESENT CASE, WHEREIN IT HAS BEEN H ELD THAT THE SECOND PROVISO 3 ITA NO.6768/MUM/2016 D J INDUSTRIES INSERTED IN SEC. 40(A)(IA) SHALL HAVE RETROSPECTIVE EFFECT. HOWEVER, SINCE THE FACTS SUCH AS TO WHETHER THE RECIPIENTS OF INTEREST INCOM E HAVE INCLUDED THE INTEREST INCOME AND WHETHER THE PROVISIONS OF SEC. 201(1) IS APPLIED ON THE ASSESSEE OR NOT, REQUIRE VERIFICATION, WE RESTORE THIS ISSUE TO THE FILE OF THE AO WITH THE DIRECTION TO EXAMINE THIS ISSUE AFRESH BY APPLYING THE SECOND PR OVISO TO SEC 40(A)(IA) OF THE ACT TO THE FACTS OF THE PRESENT CASE. ACCORDINGLY THE ORDER PASSED BY LD CIT(A) IS SET ASIDE. 7. IN THE RESULT, THE APPEAL FILED BY THE ASSESS EE IS TREATED AS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON THIS DAY OF 2 0 TH JUNE 2017 SD/- (B R BASKARAN) ACCOUNTANT MEMBER MUMBAI, DATED : 20 TH JUNE, 2017. SA COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE C I T(A), MUMBAI. 4. THE C I T 5. THE DR, SMC BENCH, ITAT, MUMBAI BY ORDER //TRUE COPY// (ASSISTANT REGISTRAR) INCOME TAX APPELLATE TRIBUNAL, MUMBAI