TaxTMI 
TaxTMI 
2016 (2) TMI 508
X X X X Extracts X X X X
X X X X Extracts X X X X
....f the I.T. Act, 1961 holding that the amendment introduced by the Finance Act, 2010 was retrospective in operation de hors the decision of the Special Bench of Hon'ble ITAT in the case of Bharati Shipyard Ltd. Vs. DCIT (132 ITD 53) which held such amendment to be not remedial or curative and, therefore, prospective." 3. Facts of the case, in brief, are that the assessee is a domestic company in which public are not substantially interested and the company is engaged in the business of transport agency. During the course of assessment proceedings the AO noted that the assessee has debited various kinds of expenses amounting to Rs. 60,02,351/- which were incurred by the assessee till the month of February 2007. According to the AO tax on t....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... 5. Based on the arguments advanced by the assessee the Ld.CIT(A) following the decision of Hon'le Calcutta High Court in the case of Virgin Creations (Supra) and various other decisions held that the provisions of section 40(a)(ia) are not attracted to the facts of the present case since the assessee has paid the TDS to the credit of the Government before the due date of filing of the return of income. 6. Aggrieved with such order of the CIT(A) the Revenue is in appeal before us. 7. We have considered the rival arguments made by both the sides, perused the orders of the AO and CIT(A) and the paper book filed on behalf of the assessee. We have also considered the various decisions cited before us. The only dispute in the ground raise....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... belatedly i.e. on 31-5-2007. In terms of an amendment made to Section 40(a)(ia) of the Act by the Finance Act, 2010 with retrospective effect from 1-4-2010 the position emerges that the assessee deducting tax at source at any time in the previous year shall be entitled to deduction of the expenditure in the year of its incurrence so long as the tax deducted has been deposited in the State Exchequer on or before the due date for filing of the return specified u/s 139(1) of the Act. Clearly, the case of the assessee is covered by the said amendment inasmuch as the tax deducted at source of Rs. 21,144/- with respect to labour payment of Rs. 19,99,800/- has been deposited on 31-5-2007 which is prior to the date specified u/s 139(1) of the Act ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ade to the provision of section 40(a)(ia) by the Finance Act, 2010 has been held to be retrospective from 1-4-2005. As a result thereof, it has to be understood that from 1- 4-2005 the effect would be that the payment of TDS to the credit of Government made on or before the due date for filing of the return u/s 139(1) of the Act for the relevant assessment year would mitigate the rigors of section 40(a)(ia) of the Act with respect to the corresponding expenditure. 8. In this background of the matter, we therefore, are of the view that the judgment of Hon'ble Calcutta High Court which ostensibly supports the view contrary to that of the Special Bench of the Tribunal in the case of Bharati Shipyard Ltd (supra) is to prevail. Nota....
X X X X Extracts X X X X
X X X X Extracts X X X X
....9;ble Calcutta High Court that Amendment to the provisions of sec. 40(a)(ia) of the Act by the Finance Act, 2010 is retrospective from 1-4-2005. Consequently, any payment of tax deducted at source during previous years relevant to and from A.Y. 2005-06 can be made to the Government on or before the due date for filing return of income u/s 139(1) of the Act. If payments are made as aforesaid, then no deduction u/s 40(a)(ia) of the Act can be made. Admittedly, in the present case the Assessee had deposited the tax deducted at source on or before the due date for filing return of income u/s 139(1) of the Act and therefore the impugned disallowance deserves to be deleted. We order accordingly and allow the appeal of the assessee." 9. I....