Contact us   Feedback   Annual Subscription   New User   Login      
Tax Management India .com
TMI - Tax Management India. Com
Extracts
Home List
← Previous Next →

2016 (7) TMI 447 - ITAT RAIPUR

2016 (7) TMI 447 - ITAT RAIPUR - TMI - Addition u/s 40(a)(ia) on account of interest paid to NBFCs - retrospectivity - Held that:- What follows is that in the peculiar circumstances of the case and looking to the nature of the provisions with which we are presently concerned, the view expressed by the Hon’ble Delhi High Court in the case of Ansal Landmark (2015 (9) TMI 79 - DELHI HIGH COURT ), which is in favour of assessee, is required to be followed by us. Revenue does not, therefore, derive a .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

the income having been offered to tax. It is this action of the coordinate bench that was upheld by the Tribunal and the course of action so adopted by the coordinate bench approved by Their Lordships. It is impermissible to pick up one of the aspects of the decision of the judicial authority and read the same in isolation with other aspects. The decision is not on the retrospectivity of the proviso alone, its also on deletion of disallowance in the event of the recipient having taken into accou .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

me in his computation of business income offered to tax, and, if found to be so, delete the disallowance in question. With these directions, the matter stands restored to the file of the Assessing Officer. - I.T.A. No. 106/RPR/2016 - Dated:- 24-6-2016 - Pramod Kumar AM and C M Garg JM For the Appellant : None For the Respondent : S K Meena and Darshan Singh ORDER Per Pramod Kumar, AM: 1. This is an appeal filed by the assessee, challenging learned CIT(A) s order dated 28th December 2015 for the .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

under section 40(a)(ia). Aggrieved, assessee carried the matter in appal, and relied upon, inter alia, Hon ble Delhi High Court s judgment in the case of CIT Vs Ansal Landmark Townships Pvt Ltd [(2015) 377 ITR 635 (Del)], but without any success. The assessee is not satisfied and is in further appeal before us. 3. We have heard the learned Departmental Representatives, perused the material on record and duly considered factual matrix of the case in the light of the applicable legal position. Non .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

on of the Tribunal in following the same. 9. ………………………. Now that the legislature has been compassionate enough to cure these shortcomings of provision, and thus obviate the unintended hardships, such an amendment in law, in view of the well settled legal position to the effect that a curative amendment to avoid unintended consequences is to be treated as retrospective in nature even though it may not state so specifically, the insert .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

obvious intention of the section. Accordingly, we hold that the insertion of second proviso to Section 40(a)(ia) is declaratory and curative in nature and it has retrospective effect from 1st April, 2005, being the date from which sub clause (ia) of section 40(a) was inserted by the Finance (No. 2) Act, 2004. 10. In view of the above discussions, we deem it fit and proper to remit the matter to the file of the Assessing Officer for fresh adjudication in the light of our above observations and a .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ffect thus, Their Lordships have approved the action of the Tribunal in remitting the matter to the file of the Assessing Officer with a direction to ascertain whether the recipient has taken into account related payments into computation of his income and offering the same to tax, and, if so, delete the disallowance under section 40(a)(ia) in respect of the same. 6. When, however, we asked the learned Departmental Representative as to why we should also not remit the matter to the file of the A .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

n 40(a)(ia) can be construed as retrospective in effect, the corresponding rule in the Income Tax Rules 1962 is not, and has not been held to be, retrospective, and the second proviso to Section 40(a)(ia) cannot, therefore, be give retrospective effect; and, third, that there is no decision on this issue by Hon ble jurisdictional High Court and, as such, the stand of the Assessing Officer cannot be faulted. 7. As for Hon ble Kerala High Court s decision in the case of Thomas George Muthoot (supr .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

Hon ble non jurisdictional High Court is to be followed by us in the present situation. It will be wholly inappropriate for us to choose views of one of the High Courts based on our perceptions about reasonableness of the respective viewpoints, as such an exercise will de facto amount to sitting in judgment over the views of the High Courts something diametrically opposed to the very basic principles of hierarchical judicial system. We have to, with our highest respect of both the Hon ble High .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

rious authorities as also by the Hon ble Supreme Court itself. In another Supreme Court judgment, Petron Engg. Construction (P) Ltd. & Anr. vs. CBDT & Ors. (1988) 75 CTR (SC) 20 : (1989) 175 ITR 523 (SC), it has been reiterated that the above principle of law is well established and there is no doubt about that. Hon ble Supreme Court had, however, some occasions to deviate from this general principle of interpretation of taxing statute which can be construed as exceptions to this general .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ambiguity, a taxing statute should be construed in favour of a tax-payer does not apply to a provision giving tax-payer relief in certain cases from a section clearly imposing liability". This exception, in the present case, has no application. The rule of resolving ambiguity in favour of the assessee does not also apply where the interpretation in favour of assessee will have to treat the provisions unconstitutional, as held in the matter of State of M.P. vs. Dadabhoy s New Chirmiry Ponri .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

second issue is with respect to the second proviso to Section 40(a)(ia) being held to be retrospective, without corresponding enabling provision in the rules being held to be retrospective. That is a hyper technical argument and too pedantic an approach. The second proviso to Section 40(a)(ia) was held to be retrospective in in the context of finding solution to the problem to the taxpayer, and the matter was set aside to the file of the Assessing Officer with certain directions about factual v .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ivity of the proviso alone, its also on deletion of disallowance in the event of the recipient having taken into account these receipts in the computation of income. The judge made law is as binding on the authorities below as is the legislated statue. The hyper technical stand of the Departmental Representatives, therefore, does not merit our approval. 9. As regards lack of guidance from Hon ble jurisdictional High Court, that can not be reason enough to disregard the decisions from non-jurisdi .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

 

 

 

 

 



|| Home || Acts and Rules || Notifications || Circulars || Schedules || Tariff || Forms || Case Laws || Manuals ||

|| About us || Contact us || Disclaimer || Terms of Use || Privacy Policy || TMI Database || Members || Site Map ||

© Taxmanagementindia.com [A unit of MS Knowledge Processing Pvt. Ltd.] All rights reserved.

Go to Mobile Version