Retrospective relief for delayed TDS payment: amended disallowance rule applies when tax is paid before the return-filing due date.

The amendment to section 40(a)(ia) by the Finance Act, 2010 was treated as remedial and curative because it removed hardship and an anomaly in the disallowance rule for delayed TDS payment. The Court held that the amended provision applies retrospectively, so tax deducted at source and paid on or before the due date for filing the return under section 139(1) satisfies the statutory condition. It further held that the phrase "said due date" refers to the return-filing deadline, not the earlier remittance date under Chapter XVII-B, and the Revenue's challenge failed.

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Issues: Whether the amendment to section 40(a)(ia) of the Income-tax Act, 1961 by the Finance Act, 2010, permitting deduction where tax deducted at source is paid on or before the due date under section 139(1), is retrospective and applicable to assessment year 2008-09.

Analysis: The appeals concerned disallowance under section 40(a)(ia) for delayed payment of TDS. The Court examined the unamended and amended text, the legislative memoranda, and the earlier decision in Rajinder Kumar. It held that the amendment was introduced to remove hardship, cure an anomaly, and make the provision workable. The Court treated the amendment as remedial and curative, and therefore applicable retrospectively. It also held that the expression "said due date" in the proviso refers to the due date for filing the return under section 139(1), not the earlier TDS remittance date under Chapter XVII-B.

Conclusion: The amended section 40(a)(ia) applied retrospectively, and TDS deposited before the due date for filing the return under section 139(1) satisfied the statutory requirement. The Revenue's challenge failed.

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