TaxTMI 
TaxTMI 
TaxTMI 
2015 (8) TMI 232
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...., JJ. For the Appellant : Sri Kamaladhar G, Adv. For the Respondent : Sri S Parthasarathi, Adv. JUDGMENT These appeals are filed by the Revenue challenging the order passed by the tribunal. 2. The same questions of law are involved in all these appeals, therefore, all are taken up together and disposed of in this common judgment. 3. The substantial questions of law that arise for consideration in all these appeals is whether, the amendment to Section 40(a)(ia) by the Finance Act, 2010, which is given effect from 01.04.2010 is retrospective in nature. 4. Prior to the amendment, the said provision read as under:- Section 40(a)(ia) : any interest, commission or brokerage, rent, royalty fees for professional services or fees for techni....
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....ub-section (1) of section 9; (iii) "professional services" shall have the same meaning as in clause (a) of the Explanation to section 194J; (iv) "work" shall have the same meaning as in Explanation III to section 194C; (v) "rent" shall have the same meaning as in clause (i) to the Explanation to section 194-I; (vi) "royalty" shall have the same meaning as in Explanation 2 to clause (vi) of subsection (1) of section 9; By Finance Act, 2010, the said provision is substituted by the following: Substituted by the Finance Act, 2010, w.e.f. 01.04.2010. Prior to its substitution, proviso as substituted by the Finance Act, 2008, w.r.e.f. 01.04.2005, read as under: "Provided that where in respect of any such sum, tax has been deducted ....
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....tivity raised in these present appeals, the focal question, therefore, would be whether the amendment brought about by way of Finance Act 2010 in Section 40 [a](ia) with effect from 1st April 2010 could be said to be clarificatory in nature for attending to unintended consequences, and therefore, is having retrospective effect from 1st April 2005. 16: A closer examination needs to be done as to whether the amended provision aims to expand the prevailing position and whether the same being in the nature of curative, retrospectivity of the same is permissible as is being contended for and on behalf of the assessee. At this stage, therefore, the true effect of such amendment needs to be discerned. 16.1: It is demonstrated before us that th....
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....ted while computing the income, under Chapter IV of the 'computation of business income'. 16.3: Thereafter, by way of amendment of Finance Act, 2008, further amendment was made whereby TDS deductible and deducted in the last month of previous year if was not paid till the due date of filing of return under sub-section (1) of Section 139 and in any other case, on or before the last day of the previous year, Section 40(a)(ia) provided for the disallowance of expenses like interest, commission, brokerage, etc. 16.4: Since, this had created anomaly, whereby tax deducted in the last month was permitted payment till filing of return as per sub-section (1) of Section 139 whereas for the TDS deducted during the rest of the months, period was pr....
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....of the Finance Bill. 16.7: Giving plain or natural meaning to the amendment as contended by the Department, if is likely to create a situation enhancing the hardship and advance discrimination, purposive and reasonable interpretation is required to be given by the Court. When plain interpretation frustrates the very legislative intent, the Court is expected to bear in mind the legislative intent from the language used in the statue with the help of permissible tools of interpretation of statute. 17: The core issue as to whether the amendment made by the Finance Act 2010 to Section 40[a](ia) of the Act is retrospective from the date of insertion of the provision i.e., 1st April 2005 therefore needs to be answered in affirmation. It can be ....
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....s upto September of the next financial year. 17.1: We draw further support from the fact that the rigor of payment of interest is also enhanced by increasing the interest charged on tax deducted, if any deposit by the specified date i.e., up to the filing of the return is not made, from 12% to 18% per annum in the provision of Section 201 (1A). Prior to the said amendment of Finance Act, 2010 under Section 201 (1A), assessee was liable to pay simple interest at one per cent for every month or part of month, in case of failure to deduct tax on payment of deducted tax, increase is made correspondingly from one per cent to one and half per cent for every month or part of month for discouraging delay in deposit. As rightly contended by the ....