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2015 (10) TMI 1870 - ITAT MUMBAI

2015 (10) TMI 1870 - ITAT MUMBAI - TMI - Rectification application u/s. 154 - whether subsequent amendment to the Income-tax Act, 1961 does not constitute mistake apparent from record - disallowance u/s. 40(a)(ia) on account of Contract payments - Held that:- The undisputed fact is that the assessee has not deposited the tax deducted at source within the stipulated time. It is also an undisputed fact that Finance Act, 2010 has amended the provisions of Sec. 40(a)(ia) of the Act whereby making th .....

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Court in the case of CIT Vs Virgin Creators [2011 (11) TMI 348 - CALCUTTA HIGH COURT] has held that the amendment by the Finance Act 2010 is retrospective with effect from 1.4.2005. Subsequent to this decision of the Hon'ble Calcutta High Court, the Bombay Tribunal in the case of Piyush Mehta Vs ACIT [2012 (4) TMI 349 - ITAT MUMBAI] has held that the judgement of Calcutta High Court being the only judgement of any High Court on this subject shall prevail.

As decided in ACIT Vs Sauras .....

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ror can be cured by a writ of certiorari according to the rule governing the powers of the superior court to issue such a writ - Decided against assessee. - ITA No. 1999/Mum/2013 - Dated:- 26-6-2015 - I. P. Bansal, JM And N. K. Billaiya, AM,JJ. For the Appellant : Shri Kishore V. Satwick For the Respondent : Shri Jeevanlal Lavidiya ORDER Per: N K Billaiya: This appeal by the assessee is preferred against the order of the Ld. CIT(A)-29, Mumbai dt. 11.12.2012 pertaining to assessment year 2005-06. .....

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e on 23.11.2007, after making inter alia, following additions u/s. 40a(ia) of the Act. i. TDS was deducted on contract payments made of ₹ 67,27,304/- and not credited the same to the Govt. A/c within the stipulated time. Further, it is seen from the Audit Report & Statement of Income, that the assessee has already disallowed an amount of ₹ 9,38,951/- u/s. 40(a)(ia) on account of Contract payments. Therefore, the balance amount of ₹ 57,88,353/- shall be disallowed u/s. 40(a) .....

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ount of ₹ 63,75,779/- (Rs. 57,88,353/- +Rs.7,080/-+ ₹ 5,74,571/-) is disallowed u/s. 40(a)(ia) and added to the total income of the assessee. 4. Vide letter dt. 28.2.2011, the assessee requested for rectification of mistake in the order passed u/s. 143(3) (supra) on the ground that the amendment made to Sec. 40(a)(ia) by Finance Act, 2010 is retrospective in effect and therefore is applicable for the year under consideration and therefore no disallowance u/s. 40(a)(ia) can be made. T .....

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therefore does not fall within the ambit of Sec. 154 of the Act. Rectification application was accordingly rejected. 5. The assessee carried the matter before the Ld. CIT(A) but without any success. 6. Before us, the Ld. Counsel for the assessee vehemently submitted that with the amendment brought by the Finance Act, 2010, and subsequent decisions of the Tribunal it has been successfully held that amendment to Sec. 40(a)(ia) is retrospective in effect therefore the Ld. CIT(A) erred in upholding .....

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the stipulated time. It is also an undisputed fact that Finance Act, 2010 has amended the provisions of Sec. 40(a)(ia) of the Act whereby making the provision that if the tax deducted at source is deposited with the Government on or before the due date of filing the return, the same will be allowed in the year of claim. This amendment was first considered by the Tribunal Special Bench in the case of Bharati Shipyard Ltd. Vs DCIT 132 ITD 53 wherein the Special Bench has held that amendment to Sec .....

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at the judgement of Calcutta High Court being the only judgement of any High Court on this subject shall prevail. 9. With this legal background, it would be pertinent to consider the observations of the Hon'ble Supreme Court in the case of ACIT Vs Saurashtra Kutch Stock Exchange Ltd. 305 ITR 227 wherein the Hon'ble Supreme Court has observed as under: "Rectification of an order stems from the fundamental principle that justice is above all. It is exercised to remove the error and to .....

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