TMI Blog2012 (4) TMI 466X X X X Extracts X X X X X X X X Extracts X X X X ..... By Appellant Nikita Brahmbhatt, AR By Respondent Shri Vinod Tanwani, SR-DR O R D E R PER Kul Bharat, Judicial Member:- The present appeal has been filed by the assessee against the order directed by Ld. Commissioner of Income-tax (Appeals)-I, Baroda dated 14-09- 2011 for assessment year 2005-06. 2. The facts in brief are that the in this case the assessment u/s. 143(3) of the Income-tax Act, 1961 was completed on 24-04-2007. Subsequently it was noticed by the Assessing Officer that the income chargeable to tax has escaped income and a notice u/s. 148 of the Act after recording the reasons u/s. 147 of the Act was served upon the assessee on 22-02-2010. The reasoning given for reopening of the assessment repr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essment. As per column 27(a) of Form No. 3CD, assessee has made payments to contractor/sub-contractor and professional/tech service, TDS was deducted on various dates from April 2004 to Feb 2005 but paid after the financial year i.e. 31.3.2005. The assessee objected to the reopening of the assessment, however, the objection of the assessee was not accepted by the Assessing Officer and he proceeded to disallow the expenses u/s. 40(a)(ia) of the Act. 3. The assessee feeling aggrieved by the order of the Assessing Officer approached the Ld. CIT(A) who dismissed the appeal of the assessee. 4. Again the assessee feeling aggrieved by the order of Ld. CIT(A) has approached before the Tribunal by way of this present appeal and raised the f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... u/s. 40(a)(ia). The Ld. CIT(A) has given view which reproduced as under:- 3.2 I have considered the matter. Disallowance of ₹ 3,69,568/- made u/s. 40(a)(ia) was in respect of amount credited in months of February and January, 2006, tax deducted from which was deposited to the credit of Government in April/August 2006. Appellant has relied upon decision of ITAT, Ahmedabad in the case of Kanubhai Ramjibhai Makwana (2011) 44 SOT 264 (Ahd) that provisions of section 40(a)(ia) as amended by Finance Act, 2010 w.e.f. 1.4.2010 are to be treated as having retrospective application with effect from 1st April, 200-5. However, ITAT s Mumbai Special Bench in the case of Bharati Shipyard Ltd. v DCIT in order dated 12.9.2011 has overruled decis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gh Court in the case of CIT v. Virgin Creators in GA No.3200/2011 dated 23-11-2011 against the Revenue. However, it is noteworthy that the Special Bench of ITAT Mumbai in the case of Bharati Shipyard Ltd. v. DCIT in ITA No.2404/Mum/2009 in order dated 12-09-2011 has taken a view that the amendment is prospective in nature and would apply accordingly. Respectfully following the decision of Hon ble Calcutta High Court in the case of Virgin Creators (supra) the order of Ld. CIT(A) is not sustainable. Hence, this ground of assessee s appeal is allowed. The Assessing Officer is directed to delete the disallowance of ₹ 3,69,568/- as made u/s. 40(a)(ia) of the Act. 8. In the result, appeal of assessee is allowed. Order pronounced in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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