9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2015 (4) TMI 84 - AT - Income TaxDeduction u/s 40(a)(ia) of the Income-tax Act, 1961 - Non deposit of TDS for previous months - Held that - Calcutta High Court in the case of CIT v. Virgin Creations in 2011 (11) TMI 348 - CALCUTTA HIGH COURT has held that the relevant amendment brought into the statute is retrospective and therefore, all such payments of TDS made before due date of filing of the return would be outside the purview of applicability of sec.40(a)(ia). Even though, the Tribunal, Mumbai Special Bench in the case of Bharti Shipyard Ltd. v. DCIT (2011 (9) TMI 258 - ITAT MUMBAI ) had held against the assessee on this issue, the decision of the Hon ble Calcutta High Court is in favour of the assessee. Therefore, we have to follow the judgment of the Hon ble Calcutta High Court rather than the decision of the Tribunal, Mumbai Special Bench. Accordingly, we hold that the Commissioner of Incometax( Appeals) is justified in deleting the disallowance made by the Assessing Officer under sec.40(a)(ia). - Decided against Revenue.
Issues:
1. Delay in filing appeal and cross objection. 2. Allowance of deduction of expenses under sec.40(a)(ia) of the Income-tax Act, 1961. Issue 1: Delay in filing appeal and cross objection: The appeal filed by the Revenue and the cross objection filed by the assessee were directed against the order of the Commissioner of Income-tax (Appeals)-XII at Chennai dated 8.11.2011, related to the assessment completed under sec.143(3) of the Income-tax Act, 1961 for the relevant assessment year 2008-09. There was a delay of three days in filing the appeal by the Revenue and a delay of two days in filing the cross objection by the assessee. The Tribunal found that the delay was to be condoned after reviewing the petitions filed by both sides. Consequently, the delay in filing the appeal and the cross objection was condoned, and they were admitted for hearing. Issue 2: Allowance of deduction of expenses under sec.40(a)(ia) of the Income-tax Act, 1961: The ground raised by the Revenue in the appeal was regarding the Commissioner of Income-tax (Appeals) allowing the deduction of expenses despite the assessee's non-compliance with the provisions of sec.40(a)(ia) of the Income-tax Act, 1961. The Revenue contended that the TDS collected in earlier months had not been paid within the stipulated time, which, according to them, necessitated disallowance under sec.40(a)(ia). However, the Tribunal referred to the decision of the Hon'ble Calcutta High Court in the case of CIT v. Virgin Creations, which held that the relevant amendment was retrospective, thus excluding TDS payments made before the due date of filing the return from the purview of sec.40(a)(ia). Despite a contrary decision by the Tribunal, Mumbai Special Bench in the case of Bharti Shipyard Ltd. v. DCIT, the Tribunal chose to follow the judgment of the Hon'ble Calcutta High Court. Consequently, the Tribunal upheld the Commissioner of Income-tax (Appeals)'s decision to delete the disallowance made by the Assessing Officer under sec.40(a)(ia). As a result, the cross objection filed by the assessee was deemed academic, and both the appeal by the Revenue and the cross objection by the assessee were dismissed. In conclusion, the Tribunal's judgment addressed the issues of delay in filing the appeal and cross objection, as well as the allowance of deduction of expenses under sec.40(a)(ia) of the Income-tax Act, 1961. The decision highlighted the importance of adhering to legal provisions and precedents set by higher courts in determining tax liabilities and deductions.
|
