TaxTMI 
TaxTMI 
2018 (3) TMI 1022
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.... rent to one Kerala State Co-operative Hospital Complex and Centre for Advanced Medical Services Ltd. The contention also is that no actual payment was made. But the liability in the subject years as also the credit made to the accounts of the lessor, is admitted. The appellant did not deduct tax for the amounts under Chapter XVII-B of the Income Tax Act, 1961. The questions of law in the appeals are reframed as follows: "(i) Whether the Tribunal erred in not deleting the additions made under Section 40(a)(ia), since the second proviso introduced by Finance Act, 2012 read with the first proviso of sub-Section (1) of Section 201 absolved the assessee from being treated as an assessee in default for reason of the payment of tax by the resident, who received the said amounts? (ii) Ought not the Tribunal have considered the provision, which was inserted by Finance Act, 2012 with effect from 01.04.2013 as curative in nature and allowed the appeal of the assessee for the years; even prior to the introduction of the proviso? (iii) Ought not the Tribunal have found that the assessee, who obtained registration as a charitable educational institution for the assess....
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....l and Sri.Christopher Abraham, appearing for the Revenue argued that the two pronged consequence, statutorily visits an assessee in default. Neither can the additions be deleted, nor the assessee absolved from the consequence of payment of TDS along with interest. It is also pointed out that the question of whether the provision is curative does not at all arise since the resident/receiver in the present case has not paid tax on the income and has filed a loss return, without any liability to pay tax, that too belatedly. The learned Senior Counsel for the Revenue has placed reliance on Prudential Logistics and Transports v. Income Tax Officer [(2014) 364 ITR 689 Ker] and Thomas George Muthoot v. The Commissioner of Income Tax (2016) 2 287 CTR (Ker) 101 . Two different Division Benches of this Court have held that the proviso to Section 40(a)(ia) is only prospective in nature. 6. We have carefully gone through the decisions placed before this Court. In Allied Motors Pvt. Ltd. and Alom Extrusions Ltd.(both supra), the amendments to Section 43B was found to be curative. The learned Senior Counsel for the appellant/assessee relying on the said decisions argued that the amendments ma....
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....any work), on which tax is deductible at source under Chapter XVII-B and such tax has not been deducted or, after deduction, has not been paid- (A) in a case where the tax was deductible and was so deducted during the last month of the previous year, on or before the due date specified in subsection (1) of section 139; or (B) in any other case, on or before the last day of the previous year. Provided that where in respect of any such sum, tax has been deducted in any subsequent year, or has been deducted. (A) during the last month of the previous year but paid after the said due date; or (B) during any other month of the previous year but paid after the end of the said previous year. Such sum shall be allowed as a deduction in computing the income of the previous year in which such tax was paid." Sub-clause (ia) stood amended as follows by Finance Act, 2010. It is the benefit of the second proviso introduced, extracted herein below; that is claimed by the assessee. (ia) thirty percent of any sum payable to a resident, on which tax is deductible at source under Chapter XVIIB and such tax has not been deducted or....
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....; xxx Provided that any person, including the principal officer of a company, who fails to deduct the whole or any part of the tax in accordance with the provisions of this Chapter on the sum paid to a resident or on the sum credited to the account of a resident shall not be deemed to be an assessee in default in respect of such tax if such resident- (i) has furnished his return of income under section 139; (ii)has taken into account such sum for computing income in such return of income; and (iii) has paid the tax due on the income declared by him in such return of income and the person furnishes a certificate to this effect from an accountant in such form as may be prescribed." 8. As per the first proviso to Section 201(1), when a resident, who receives any sum from an assessee, has furnished his return of income under Section 139 and taken into account such sum for computing income, as also paid the tax due on the income declared by him in such return of income; then assessee would stand absolved from being treated as an ....
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.... of the method of accounting of the assessee, herein and the contention is only to be rejected. The definition clause has nothing to do with Section 201(1) or the determination of an 'assessee in default'. 11. We cannot countenance the further argument of the learned Senior Counsel that the appellant/ assessee should be considered as a charitable educational institution under Section 12AA. Admittedly, the assessee had applied for such registration only in the year 2011-12. The application for condonation of delay for the previous years stood rejected. There is no question of any exemption allowed in a year in which such registration was not available; especially by this Court exercising jurisdiction under Section 260A of the I.T. Act. 12. We, hence, answer question Nos.1 to 3 framed and extracted herein above against the assessee and in favour of the Revenue. 13. The only question remaining to be considered is as to the liability of the assessee under Section 201(1) being treated as an assessee in default. Hindustan Coca Cola Beverage (P) Ltd. (supra) was in a totally different circumstance, where the resident receiver had paid the tax, and the Honourable Supreme C....