TaxTMI 
TaxTMI 
2012 (9) TMI 613
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....djudication viz., (i) whether the lower authorities were justified in making disallowance of Rs.2,94,800/- u/s 40(a)(ia) of the Income-tax Act, 1961 [hereinafter referred to as "the Act"] under the facts and circumstances of the case and (ii) whether the authorities below are justified in making disallowance of Rs.6,68,920/- u/s 40A(3) of the Act under the facts and circumstances of the case. That apart, without prejudice to right to seek waiver with the CCIT/DG, the assessee has taken grounds relating to levy of interest u/s 234-B and 234-C of the Act. 3. Let us first deal with the issue relating to disallowance u/s 40(a)(ia) of the Act. While framing the assessment u/s 143(3) of the Act for the relevant assessment year, the AO no....
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....ts vs. Addl. CIT reported in (2012) 146 TTJ (Vishaka)(SB). 3.3. We have also heard the learned Departmental Representative. The Special Bench in the above said case held as under: "...the only word put in the provision of section 40(a)(ia) of the Act is 'payable' and not 'paid' or 'credited', rather Legislature consciously replaced the word 'amounts credited or paid' with the word 'payable' in the final enactment and such change was done with a purpose. I am of the view that presumption that enactment brought in by the Legislature is well-thought off and properly worded in order to give meaning to its intent. The Legislature by consciously replacing the words from 'credited' or 'paid' to 'payable', the intent has been made clear that ....
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.... 194-LA may also be looked into which says that tax has to be deducted only at the time of payment. The language in these sections therefore shows that the legislature has used different language in different sections. It is trite law that each and every word of the section has its own meaning and while drafting section 40(a)(ia) of the Act, the legislature was conscious of the fact that there may be a case where the amount is paid and there may be a case where the amount is payable and have used appropriate words so that the language may be clear and clear meaning may be given. One may look into the language contained in Finance Bill, 2004 wherein this provision was introduced. In the Finance Bill both the words paid and payable were used ....
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.... and hence is not applicable for the year under appeal. The CIT(A), after considering the arguments, has observed as under: "Prior to the amendment, i.e. before 1-4-2009, the phrase 'aggregate of payments' is not there. However, this amendment is only clarificatory in nature vis-a-vis the expenditure towards which the payments are made. Any such amendment which is curative in nature is retrospective in operation. Reliance is placed on the decision of the honourable Supreme Court in the case of Allied Motors Pvt.Ltd. vs. CIT (1997) 201 ITR 677 (SC) and on CIT vs. ALOM Extrusions Ltd. (2009) 319 ITR 306(SC). In the case of CIT vs. ALOM Extrusions Ltd., the gist is as follows: 'Business expenditure - Disallowance under s.43B - Contributi....
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....s and in the circumstances of the appellant's case." At the time of hearing, learned counsel for the assessee placed reliance on the following decisions: i) CIT vs. Ashok Iron & Steel Rolling Mills (2010) 320 ITR 1(All), ii) CIT vs. Aloo Supply Co. (1980)121 ITR 680(Orissa), and iii) Shree Mahaveer Corporation vs. ITO (2002)258 ITR (AT) 55 (Bang). By placing reliance on the above decisions, learned counsel for the assessee submitted that disallowance cannot be made in the case of the assessee u/s 40A(3) of the Act. 4.3 Per contra, learned Departmental Representative placed reliance on the following decisions: i) CIT vs. Dalip Chand & Sons (2008) 301 ITR 276(HP), ii) Shri Radhika Prakashan (Raipur) (P.) Ltd. vs. CIT (....