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TMI Blog2014 (11) TMI 1154X X X X Extracts X X X X X X X X Extracts X X X X ..... nt dated 27.6.2013 passed by learned Income Tax Appellate Tribunal, Jodhpur Bench, Jodhpur affirming the order passed by the Commissioner of Income Tax (Appeals), Udaipur dated 31.3.2011. The factual matrix necessary to the noticed for adjudication of this appeal is that the assessee Shri Harish Chandra Ahuja, proprietor of firms M/s. Ashirwad Crusher Industries, Nimbahera and M/s. Ankita Construction Company, Nimbahera, filed return of income for an amount of ₹ 64,25,434/- on 31.10.2007 and assessment of that was completed on 30.12.2009. The Assessing Authority assessed income of the assessee in a tune of ₹ 4,94,14,649/- with disallowance of TDS deducted for a sum of ₹ 4,26,65,256/- being not deposited to government account within the time limit prescribed. To assail the assessment made by the Assessing Officer under the order dated 30.12.2009 the assessee preferred an appeal, that came to be allowed vide order dated 31.3.2011. The learned Commissioner Income Tax while setting aside the assessment order dated 31.12.2009 held that the provisions of Section 40[a](ia) as amended by the Finance Act, 2010 are remedial/curative in nature, thus, the same would a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , or has been deducted during the previous year but paid after the due date specified in Sub-Section (1) of Section 139, such sum shall be allowed as a deduction in computing the income of the previous year in which such tax has been paid. ; The notes on Clauses and memorandum explaining the amended provision, while introducing the Finance Bill, 2010 reads as under :- Clause 12 of the Bill seeks to amend section 40 of the Income-tax Act relating to amounts not deductible. Under the existing provisions contained in sub-clause (ia) of clause (a) of the aforesaid section, non-deduction of tax or non-payment of tax after deduction on payment of any sum by way of interest, commission or brokerage, rent, royalty, fees for professional services or fees for technical services payable to a resident or amounts payable to a contractor or subcontractor, being resident, results in the disallowance of the said sum, in the computation of income of the payer, on which tax is required to be deducted under Chapter XVII-B. It is proposed to amend sub-clause (ia) of clause (a) of the aforesaid section to provide that disallowance under the said sub-clause will be attracted, if, after deductio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... th or part of month. This amendment is proposed to take effect from 1st July, 2010. The Finance Minister while introducing the Finance Bill, 2010 stated at the floor of the parliament that :- Relaxing the current provisions on disallowance of expenditure, I propose to allow deduction of such expenditure, if tax has been deducted at any time during the financial year and paid before the due date of filing the return. This will allow most deductors additional time upto September of the next financial year. At the same time, I propose to increase the interest charged on tax deducted but not deposited by the specified date, from 12 per cent to 18 per cent per annum . The amended provision, its explanation and the contents of the Finance Bill, 2010 speech clearly indicates curative nature of the amendment brought in. A Division Bench of Gujarat High Court while examining a question in the terms that whether the Income Tax Appellate Tribunal was justified in deleting the addition of ₹ 23,13,933/-, relying upon the amendment made in Section 40[a](ia) of the Income Tax Act, 1961 by the Finance Act, 2010 and thereby giving it retrospective effect, after taking into con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... DS made during the last month of the previous year was already available by the amendment made by Finance Act 2008. Thus, it is apparent that the relaxation made by the amendment made under the Finance Act, 2010 brings the law in parity with the aforementioned situation and accordingly, for the TDS deducted all throughout the year, time is extended from payment till the filing of return. It is thus apparent that when the amendment introduced by the Finance Act, 2008 of relaxing the time for deposit of TDS was made retrospective from the year 2005 [1st April 2005], the amendment by Finance Act 2010 with regard to other limb of time limit for payment of TDS has to be held retrospective not from 1st April 2010 only. If we recall at this stage the speech of Finance Minister while introducing this provision by way of Finance Act, 2010, this amendment essentially has been brought for relaxing the current provision on disallowance of expenditure. The tax, if is deducted at any time during the financial year and paid before the date of filing of the return, the Legislature intended to allow deduction on such expenditure with an intention to permit additional time for most deductors upto ..... X X X X Extracts X X X X X X X X Extracts X X X X
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