9911796707
TMI Blog2013 (8) TMI 962X X X X Extracts X X X X X X X X Extracts X X X X ..... (2) The ld. CIT(A) ought to have noticed that amendment made to section 40(a)(ia) by the Finance Act, 2010 is applicable to A.Y. 2010-11 and subsequent years and is not retrospective in nature. As such, the learned CIT(A) erred in directing not to disallow the expenditure since the payments were made before the due date for filing return of income. (3) The learned CIT(A) erred in holding that the assessee's contribution towards PF and ESI are paid within the due date for filing the return of income oblivious of the fact that 36(1)(va) for M/s. Sri Lakshmi Gayatri Hotels Pvt. Ltd. remittance of employee's contributions is the 'due date' in the relevant fund and is not governed by the provisions of section 43 so as to equate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y observing as under: "6.3 I find that this issue has been examined by the Calcutta High Court in CIT vs. Virgin Creations (GA No. 3200/2011 dated 23.11.2011) where it was held that the amendment to the provision was retrospective in nature. This decision was also followed by the ITAT, Ahmedabad Bench in the case of M/s. Alpha Projects Society P. Ltd. vs. DCIT (ITA No. 2869/Ahd/2011, dated 23.3.2012). Respectfully following these decisions, it is held that the amendment to sec. 40(a)(ia) permitting the deductor to remit the TDS to Government Account on or before the due under sec. 139(1) is retrospective, and therefore, applicable to the appellant for the A.Y. 2009-10. Consequently, the disallowance under sec. 40(a)(ia) is set aside a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... are as follows: MONTH DUE DATE PF (Rs.) DATE OF PAYMENT ESI (Rs.) DATE OF PAYMENT May, 2008 20.06.2008 34,829 27.06.2008 9,889 27.06.2008 Jun, 2008 20.07.2008 32,950 25.07.2008 9,095 25.07.2008 Aug, 2008 20.09.2008 27,599 23.10.2008 7,963 23.10.2008 Sep, 2008 20.10.2008 24,753 Sep, 2008 7,254 23.10.2008 Total 1,20,131 34,201 Addition 1,54,332 9. The AR relied on the order of the CIT(A) and also on the judgement of Delhi High Court in the case of AIMIL Ltd. (supra) and also on the judgement of Himachal Pradesh High Court in the case of CIT vs. Nipso Polyfabriks Ltd.(350 ITR 327). 10. We have heard both the parties and perused the material on record. In this case there is no dispute that the employees' ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... etable, meat, milk and such other products and it was not likely that the employees would go around buying these items from the roadside markets. The AO also observed that there were more than one entry of purchases of same items on a single day with each entry being less than ₹ 20,000. The AO held that since the assessee had incurred expenditure of ₹ 2,48,42,505 to meet the day to day needs of the business, a disallowance of 35% of this expenditure would meet the ends of justice. 13. On appeal the CIT(A) observed as under: "However, there are certain aspects of the case that need to be considered. The assessee is a company running starred hotels in Hyderabad. For a hotel of this stature, the normal practice is to have co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... th the parties and perused the material on record. In the present case the assessee incurred cash expenditure of ₹ 2,48,42,505 and the assessee recorded most of the payments as less than ₹ 20,000 in its books of account which are supported by self-made vouchers and not verifiable. So there is every chance of inflating the expenditure. Considering these facts, as held by the jurisdictional High Court in the case of CIT vs. Transport Corporation of India (256 ITR 7012), we are inclined to disallow 15% of the amount ₹ 2,48,42,505 worked out at ₹ 37,26,375 towards disallowance. This ground in Revenue appeal is dismissed and the ground by the assessee in its CO is partly allowed. 15. In the result, Revenue appeal is dism ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
