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TMI Blog2017 (4) TMI 404X X X X Extracts X X X X X X X X Extracts X X X X ..... donation of delay in filing appeal for A.Y. 2007-08 2.1 There is admittedly a delay of 248 days in filing this appeal before the Tribunal. The impugned order of the CIT(A) dated 01.06.2011 was admittedly received by the assessee on 20.06.2011 and therefore the appeal before the Tribunal was to have been filed on or before 20.08.2011, but however was filed on 23.04.2012, thereby leading to a delay of 248 days in filing the appeal. The assessee has filed a petition seeking condonation of the aforesaid delay of 248 days, accompanied by an affidavit sworn to dated 02.05.2012 in this regard. In the affidavit the assessee has, inter alia, prayed for condonation of the aforesaid delay submitting as under: - 4. I was given to understand that no relief would be available to me in respect of non deduction of tax at source u/s 40(a)(ai). I am given to understand now it is likely that relief would be available to me, since the issue under appeal is on a law point and since relief is being allowed in other matters in view of the decisions stated herein below. a. Merilyn Shipping and Transport V. ACIT 9ITAT Visakhapatnam Special Bench) b. Hindustan Coca Cola Beverages P. Ltd. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act') vide order dated 23.12.2009, wherein the income of the assessee was determined at ₹ 59,75,560/- in view of the following additions/disallowances: - (i) Royalty - under section 40(a)(ia) r.w.s. 194J ₹ 15,00,000/- (ii) Interest - under section 40(a)(ia) r.w.s. 194A ₹ 10,08,795/- (iii) Editing under section 40(a)(ia) r.w.s. 194J ₹ 3,58,040/- (iv) Under section 40(a)(ia) r.w.s. 194-I ₹ 12,53,820/- 3.2 Aggrieved by the order of assessment dated 23.12.2009, the assessee preferred an appeal before the CIT(A)-3, Mumbai. The learned CIT(A) disposed off the appeal vide the impugned order dated 01.06.2011, allowing the assessee partial relief. The addition/disallowance listed at (i) in para 3.1 of ₹ 15 lakhs (supra) was deleted by the learned CIT(A), who however fully upheld the disallowance under section 40(a)9ia) of the Act listed at (ii) and (iii) (supra). In respect of the disallowance under section 40(a)(ia) as listed at (iv) in para 3.1 (supra), the learned CIT(A) upheld the disallowance to the extent of ₹ 8,42,640/- and allowed the assessee partial relief of ₹ 4,11,180/-. 4. The assessee, aggriev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eturn of income for A.Y. 2007-08. In support of the above proposition put forth by the assessee seeking deletion of the disallowance under section 40(a)(ia) of the Act of ₹ 10,08,795/- on account of payment of interest to M/s. Adlabs Films Ltd. the assessee has, inter alia, placed strong reliance on the following judicial pronouncements: - (i) CIT vs. Ansal Land Mark Township (P) Ltd. (2015) 61 taxmann.com 45 (Delhi) (ii) M/s. Selprint vs. CIT (ITA No. 3688/Mum/2012 dated 21.10.2015) (iii) G. Shankar vs. ACIT (ITA No. 1832/Bang/2013 dated 10.10.2014) 6.2.2 Per contra, the learned D.R. strongly supported the decisions of the authorities below on this issue. 6.3.1 We have heard the rival contentions and perused and carefully considered the material on record; including the judicial pronouncements cited/relied. On an appreciation of the facts on record it is seen that the authorities below have made and sustained the disallowance under section 40(a)(ia) of the Act for non deduction of tax at source in respect of interest payments by the assessee to M/s. Adlabs Films Ltd. as it was not a financial institution in terms of the provisions of section 194A of the Act. A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... isallowance has been made by the lower authorities under section 40(a)(ia) on account of non deduction of TDS on payments made to M/s. M.R. Enterprises. It is the contention of the Ld. A.R. that M/s. M.R. Enterprises has already discharged the tax liability by duly filing the return of income. He has contended that as per the new proviso inserted in section 40(a)(ia) vide Finance Act, 2012 w.e.f. 01.04.13 wherein it has been provided that if the assessee fails to deduct TDS in respect of any payment to which the TDS provisions apply but he is not deemed to be an assessee in default under section 201 of the Act, which provides that if the payee of the such amount computed the same into his income tax return and has paid the due taxes, then such an assessee will not be deemed to be an assessee in default and then no disallowance is attracted under section 40(a)(ia). He has further submitted that the said newly inserted proviso to section 40(a)(ia) is in fact clarificatory in nature and should be applied/retrospectively for the year under consideration and as such no disallowance is attracted on this issue. 4. On the other hand, the Ld. D.R. has contended that it has been specif ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n it was held that the insertion of the second proviso to section 40(a)(1a) of the Act should be read retrospectively from 1.4.2005 and not prospectively from 1.4.2013. In this view of the matter, the provisions of section 40(a)(ia) of the Act is not attracted to the payments made by the assessee to Sri G.Shankar of ₹ 2,69,21,500 and to Sri Ramesh Kotian of ₹ 1,54,75,000 since the object of introduction of section 40(a)(ia) of the Act is achieved for the reason that the payees / recipients have declared and offered to tax the payments received from the assessee in their respective hands. 3.4.2 As regards the issue of non-furnishing of Form No.26A, we are of the view that since the second proviso to section 40(a)(ia) of the Act is held to be retrospective in operation w.e.f. 1.4.2005, similarly, Form 26A was to be filed for an assessee not to be held as an assessees in default as per proviso to section 201 of the Act. In all fairness, the assessee in the period under consideration i.e. Assessment Year 205-06 could not have contemplated that such a compliance was to be made and therefore in the interest of equity and justice we set aside the order of the learned CIT ..... X X X X Extracts X X X X X X X X Extracts X X X X
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