2022 (3) TMI 1464 - SCH - Income Tax

Deduction u/s 80JJ(AA) - payments made to the employees hired by the Assessee in the previous year - scope of amendment of the year 2018 - requirement of being a workman in terms of Section 2(s) of the I.D.Act - What is required is for a person to be employed for a period of 300 days continuously? HC held that that the same is more an explanatory amendment or a clarificatory amendment which clarifies the methodology of applying Section 80JJ-AA of the Act. If the submission of Sri. K.V.Aravind is accepted, then no employer/assessee would be able to fulfil the requirement of employing its labour/assessee prior to 5th June of that assessment year so as to claim the benefit of Section 80JJ-AA. Such a narrow and pedantic approach is impermissible. Software engineer being workman having satisfied the period of 300 days, the assessee is entitled to claim deduction under Section 80JJAA. As argued that the High Court has erred in observing and holding that the amendment of the year 2018 can be said to be curative and/or clarificatory. It is submitted that the High Court has erred in applying the amendment of the year 2018 retrospectively. It is also the case on behalf of the ASG that, being an exemption provision, the same has to be construed strictly and literally. HELD THAT - Issue notice, returnable on 29.04.2022. Dasti, in addition, is permitted.

Summary

The Supreme Court of India, in a recent judgment, found that the High Court erred in applying a 2018 amendment retrospectively. The court issued a notice returnable on 29.04.2022 and permitted Dasti in addition.