2017 (5) TMI 1627

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....a)(ia) of the Income-tax Act, 1961 (in short '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 of....

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....serted w.e.f. 1.4.2013 is prospective and not 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....

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....Coordinate Chandigarh Bench of the Tribunal after considering both the decisions (supra) has observed that the decision of the Hon'ble Delhi High Court is a later decision and further that it is well settled law that if two views are possible, the decision in favour of the assessee, may be followed. The impugned disallowance was, therefore, ordered to be deleted. The Ld. counsel for the Revenue has not referred to any decision of the jurisdictional Punjab & Haryana High Court on this issue. Now it is settled law that if two views in regard to the interpretation of a provision are possible, the Court would be justified in adopting that construction which favours the assessee. Reliance in this respect can be placed on the decision of t....