9911796707
TMI Blog2022 (1) TMI 961X X X X Extracts X X X X X X X X Extracts X X X X ..... diagnosed with brain tumor and his health condition continued to remain bad even as on date. It was submitted that all-along, the assessee was under the impression that the present appeal had been filed by the Advocate, however, subsequently on receipt of communication from the AO regarding initiation of penalty proceedings, he came to know that the impugned order has not been appealed against. Subsequently, the assessee contacted the Counsel's office and he was told about the ill health of the Counsel and the fact that the appeal has not been filed. Thereafter the assessee engaged another Counsel to prepare and file the present appeal which was thereafter filed within a period of 10 days of appointment of the new Counsel. It was accordingly submitted that the delay so happened was totally unintentional and due to bona fide reasons the appeal could not be filed and in this regard, an affidavit of the assessee has also been filed along with condonation application. It was accordingly submitted that the delay so happened in filing the present appeal be condoned and the appeal of the assessee be heard on merits. 3. The Ld. DR submitted that there is a substantial delay in filing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ck of communication or inaction on part of the Counsel. At the same time, it was also expected on part of the assessee to follow up on the matter with his Counsel from time to time, however, there again is an unspoken and generally understood belief which the assessee carries that once the Counsel is engaged and has been given proper instructions, the Counsel will take care of the matter and need for communication arises only where there is need for any fresh instructions. On balance, we find that there exists sufficient and reasonable cause for condoning the delay in filing the present appeal and as held by the Hon'ble Supreme Court, where substantial justice and technical considerations are pitted against each other, the cause of substantial justice deserved to be preferred and the assessee deserve to be heard on merits of the case. Therefore, in exercise of powers under section 253(5) of the Act, we hereby condone the delay in filing the present appeal as we are satisfied that there was sufficient cause for not presenting the appeal within the prescribed time and the appeal is hereby admitted for adjudication on merits. 5. Now, coming to the merits of the case. Briefly, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8. The submissions so filed by the assessee were considered but not found acceptable by the Ld. CIT(A). As per the Ld. CIT(A), the assessee had sufficient time at the time of assessment proceedings to submit the necessary certificate and even after a gap of more than two years of filing the appeal, the assessee has not been able to get the necessary certificates from the parties in support of his contention that the payees have furnished their return of income and have taken into consideration the same and has paid taxes thereon. It was accordingly held by the Ld. CIT(A) that the assessee has failed to produce necessary evidence with regard to the fact that the taxes have been duly deposited by the payees and corresponding income have been taken into consideration while filing their respective returns and mere filing of undated letters of the concerned parties does not support the case of the assessee. It was further held by the Ld. CIT(A) that the amendment brought in by the Finance Act, 2012 is prospective and not retrospective in nature and, therefore, the assessee cannot be allowed to take shelter under the said amendment. The Ld. CIT(A) accordingly confirmed the order passed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of hearing, the AR submitted that an amendment has been made by the Finance Act, 2014 w.e.f. 01.04.2015 in Section 40(a)(ia) whereby it is provided that 30% of any sum payable to a resident shall be disallowed if tax is not deducted at source under Ch. XVIIB as against the 100% disallowance presently made. The purpose of this amendment was explained in the memorandum as under:- "the disallowance of whole of the amount of expenditure results into undue hardship and therefore in order to reduce the hardship, it is proposed that in case of non-deduction or nonpayment of TDS on payments made to residents as specified in section 40(a)(ia) of the Act, the disallowance shall be restricted to 30% of the amount of expenditure claimed." 12. The Finance Minister while introducing the amendment in Para 207 of the Budget Speech has stated as under:- "207, Currently, where an assessee falls to deduct and pay tax on specified payments to residents, 100 percent of such payments are not allowed as deduction while computing his income. This has caused undue hardship to taxpayers, particularly where the rate of tax is only 1 to 10%. Hence, I propose to provide that instead of 100 percent, only ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dment should be given to the assessee either by directing the AO to confirm from the contractors, namely M/s. Garvit Stonex, M/s. Chanda Marbles and M/s. Nidhi Granites as to whether the said parties have deposited the tax or not and further or restrict the addition to 30% of Rs. 7,51,322/-. In our view it will be tied of justice if the disallowance is only restricted to 30% of Rs. 7,51,322/-," 16. We have heard the rival contentions and pursued the material available on record. In the instant case, there is no dispute that the assessee is liable to deduct IDS on interest payment to Shri Ramesh Chand and non-deduction of the TDS will entail disallowance u/s. 40(a)(ia) of the Act, However, in view of the consistent position taken by the Coordinate Benches of the Tribunal wherein the amendment in section 40(a)(ia) has been held retrospective in nature, the disallowance is restricted to 30% of the total amount. In the result, the cross-objection is partly allowed. 10. Per contra, the Ld. DR relied on the orders of the lower authorities. 11. We have heard the rival contentions and perused the material available on record. We find that an amendment has been brought in by the Finance ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
