TMI Blog2012 (9) TMI 470X X X X Extracts X X X X X X X X Extracts X X X X ..... l of the Revenue is directed against the order passed by the CIT (A)- XXVII, New Delhi, dated 05.01.2012, relevant to assessment year 2008-09, wherein deletion of addition of Rs.19,75,456/- made by the Assessing Officer u/s 40(a)(ia) of the I.T.Act,1961on account of late deposit of TDS made by the assessee with respect to rent, commission and maintenance expenses without appreciating the fact that amendment brought in by section 40(a)(ia) of the Act was only effective from 1.4.2010 and not retrospective in nature, has been challenged. 2. The Assessing Officer noted that since there was an apparent default in deposit of TDS, the assessee was asked to furnish, copy of all the TDS returns filed with the department with evidence in support of deposit of TDS. The detail of expenses on which TDS deducted but deposited late and TDS not deducted is as under: Head under which expenses claimed Payments made/credited before March Date of payment/credit after March 08 Total Date for deposit of TDS for payments made upto March 08 Date of deposit of TDS Rent 506000 46000 552000 31/3/2008 13/6/2008 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... specifically in relation to relevant provision, therefore, it could not be applied and it was prayed for setting aside the order of CIT(A) and restoring that of the Assessing Officer. 5. Ld.Counsel for the assessee submitted that this issue is squarely covered in favour of the assessee by Hon ble Calcutta High Court decision in the case of CIT vs. Virgin Creations (supra) which has also considered Spl. Bench decision of ITAT in the case of Bharati Shipyard Ltd. in which said amendment was held to be retrospective from assessment year 2005-06 and now C bench, ITAT, Mumbai, in the case of Shri Piyush C. Mehta in I.T.A. No.1321/Mum./2009 for assessment year 2005-06 vide order dated 11.4.2012 has followed Calcutta High Court decision to hold that provision of amendment u/s 40(a)(ia) of the Finance Act, 2010 is retrospective from 1.4.2005 and consequently the payment of tax deducted at source during previous year relevant to and from assessment year 2005-06 can be made to the Govt. on or before due date for filing of the return under section 139(1) and since TDS has been deducted and paid within time stipulated for filing of the return u/s 139(1), therefore, CIT(A) has passed a lega ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of tax at source. Interest on loans were credited to the creditors account on 31.3.2005 to the extent they were paid after the due date for filing return of income u/s.139(1) of the Act, the disallowance was made u/s.40(a)(ia) of the Act. Before the Tribunal, the Assessee contented that the amendment by the Finance Act, 2010 with retrospective effect from 1st April, 2010 whereby amount of tax deducted at the time of making payment in respect of expenditure referred to in Sec.40(a)(ia) of the Act, if paid to the Government on or before the due date for filing the return of income due date u/s 139(1) of the Act should be allowed as a deduction. In other words it was argued that the amendment by the Finance Act, 2010 to the provisions of Sec.40(a)(ia) has to be held to be retrospective w.e.f. 1-4-2005. The ITAT Kolkata Bench by its order dated 15.12.2010, held as follows: 8. After hearing the rival submissions and on careful perusal of the materials available on record, keeping in view of the fact that though the Ld.D.R. submitted that the decisions of the Coordinate Benches are not binding and the Kolkata benches may take a different view, since Mumbai Bench after analyzing the pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... igh Court. Therefore, respectfully following the decision of the Coordinate Benches (supra), we allow the ground nos. I to 3 of the assessee s appeal. 16. As against the aforesaid decision the Revenue preferred appeal before the Hon ble Calcutta High Court. The Hon ble Calcutta High Court in ITA No. 302 of 2011 GA 3200/2011 decided on 23.11.2011, held as follows: We have heard Mr. Nizamuddin and gone through the impugned judgment and order. We have also examined the point formulated for which the present appeal is sought to be admitted. It is argued by Mr. Nizamuddin that this court needs to take decision as to whether section 40(A)(ia) is having retrospective operation or not. The learned Tribunal on fact found that the assessee had deducted tax at source from the paid charges between the period April 1, 2005 and April 28, 2006 and the same were paid by the assessee in July and August 2006, i.e. well before the due date of filing of the return of income for the year under consideration. This factual position was undisputed. Moreover, the Supreme Court, as has been recorded by the learned Tribunal, in the case of Allied Motors Pvt. Ltd. and also in the case of Alom Extru ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ld following the decision of the Hon ble Calcutta High Court that Amendment to the provisions of Sec.40(a)(ia) of the Act, by the Finance Act, 2010 is retrospective from 1.4.2005. Consequently, any payment of tax deducted at source during previous years relevant to and from AY 05-06 can be made to the Government on or before the due date for filing return of income u/s.139(1) of the Act. If payments are made as aforesaid, then no deduction u/s.40(a)(ia) of the Act can be made. Admittedly in the present case the Assessee had deposited the tax deducted at source on or before the due date for filing return of income u/s.139(1) of the Act and therefore the impugned disallowance deserves to be deleted. We order accordingly and allow the appeal by the Assessee. 20. In the result, the appeal by the Assessee is allowed. 7. As such, in view of Calcutta High Court decision in the case of CIT vs. Virgin Creations (supra) which has been followed by ITAT, Mumbai, C bench in the case of Piyush C. Mehta vs. ACIT(surpa), the impugned order, in our opinion, needs to be upheld. Therefore, following said decision, we uphold the order CIT(A) and dismiss the appeal of the Revenue. 8. As a res ..... X X X X Extracts X X X X X X X X Extracts X X X X
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