2017 (5) TMI 1627

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....hort 'the Act') on account of non deduction of TDS on payment of job work. 3. None has come present on behalf of the assessee despite service of notice, hence, we proceed to decided the appeal on merits ex parte of the assessee. 4. The brief facts relevant to the issue are that the assessee during the year debited Rs. 98,99,141/- on account of job work, out of which Rs. 95,31,276/- was paid to M/s Jhandu Construction Company without deduction of tax. The Assessing officer took the view that the said payment should have been made only after deduction of tax at source as per the provisions of Chapter XVII B of the Act. In view of assessee's failure to deduct tax at source, the Assessing officer disallowed payment in question u/s 40(....

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....retrospective. It has therefore, been pleaded that the action of the CIT(A) in deleting the disallowance was not correct.   6. We have considered the rival submissions and have also gone through the record. The sole issue raised in this appeal by the Revenue pertains to the retrospectivity of the second proviso to section 40(a)(ia) of the Act, which reads as under:- "Provided further that where an assessee failed to deduct the whole or any part of tax in accordance with the provisions of Chapter XVII-B on any such sum but is not deemed to be assessee in default under the first proviso to sub-section (1) of section 201, then, for the purpose of this sub-clause, it shall be deemed that the assessee has deducted and paid the tax on suc....