2013 (6) TMI 771

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....ance made by the Assessing Officer under section 40(a)(ia) of the Income Tax Act. 3. Facts in brief are that the assessee is an individual, engaged in the business of trading in paper and paper products in the name of proprietorship firm S.R. Agency. During the year under consideration, the assessee had filed return declaring total income of Rs. 9,37,400/- on 30.09.2008. Initially, the assessment was processed under section 143(1) of the Act. Subsequently, after issuing notice under section 143(2), the assessment was completed under section 143(3) of the Act by disallowing an amount of Rs. 28,43,035/- under section 40(a)(ia) of the Act. 4. During the course of assessment proceedings, the Assessing Officer has observed that on verifica....

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....emove the hardships being caused to the assessee belonging to such category, amendments have been made to the provisions of section 40(a)(ia) by the Finance Act, 2010. The said amendment was clearly curative in nature and the same would, therefore apply retrospectively with effect from 01.04.2005. In the case of R.B. Jodha Mal Kuthiala v. CIT [82 ITR 570], it was held by the Hon'ble Supreme Court that a proviso which is inserted to remedy unintended consequences and to make the provision workable, requires to be treated as retrospective in operation so that a reasonable interpretation can be given to the section as a whole. Hence, the amendment by Finance Act, 2010 is only a remedial and curative in nature and hence the said provisions are ....

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.... below. The assessee is in the business of trading of paper and paper products and has incurred various expenses i.e. commission, interest, godown rent and lorry freight of Rs. 28,43,035/-. On that, the assessee has deducted TDS of Rs. 2,06,208/-. The deducted amount of Rs. 2,06,208/- was deposited in the Central government account by the assessee on 08.04.2008. According to the Assessing Officer, the assessee has failed to comply with the provisions of the TDS and there is a delay in depositing the amount and disallowed the entire expenses incurred by the assessee. On appeal, the ld. CIT(Appeals) has observed that the assessee has complied with the provisions of section 40(a)(ia) of the Act and the action of the Assessing Officer in disall....