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2016 (10) TMI 169 - HC - Income TaxDisallowance u/s 40(a)(ia) - tax deducted at source not deposited within the time allowed - assessee preferred a revision petition before the Commissioner under Section 264 wherein he did not grant the benefit of the deduction to the assessee during such assessment year provided directed the Assessing Officer to make necessary rectification in exercise of powers under Section 154 of the Act for the relevant years and give effect to the expenses so disallowed in the earlier year. Held that:- The assessee having deducted tax at source deposited in the government only after the end of the year under consideration but before the due date for filing of the return. In view of the amended provision of Section 40(a)(ia) of the Act by virtue of amendment dated 01.04.2010, such expenditure would also be deductible during the same year. This provision was held to have retrospective effect by the judgement of the High Court in case of Omprakash R Chaudhary (2015 (2) TMI 150 - GUJARAT HIGH COURT). On the basis of such statutory change and the judgement of the High Court, the assessee was, as held by the Supreme Court in case of Assistant Commissioner of Income Tax vs. Saurashtra Kutch Stock Exchange Limited reported in [2008 (9) TMI 11 - SUPREME COURT ], entitled to seek rectification. The Tribunal correctly granted such a relief which was denied by the Assessing Officer and Commissioner (Appeals). The Commissioner (Appeals) was not correct in holding that no appeal against the order passed by the Assessing Officer under Section 154 of the Act would be maintainable. The order of the Assessing Officer was passed dealing with the assessee's application for rectification under Section 154 of the Act in which, a specific prayer of the assessee was that the expenditure be recognized during the financial year in which the same was made. The anxiety of the counsel for the Revenue that the assessee may claim double deduction cannot be shared. The Tribunal, as noted in the impugned judgement, has made sufficient provision for withdrawal of the benefit of the expenditure in the later years if by virtue of the order of the Commissioner under Section 264 of the Act the same was already granted to the assessee. This direction the assessee has not challenged. Before us also no such request is made. The direction of the Tribunal, therefore, binds the assessee.
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