2025 (7) TMI 1478

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....(Appeals), both dated 27.10.2023, which in turn arises out of a separate orders passed by the Assessing Officer u/s 143(1) of the Act. 2. Since, these two appeals filed by the same assessee for different assessment years and different issues are involved, therefore, all these appeals have been clubbed and heard together and a consolidated order is being passed for the sake of convenience and brevity. 3. The Grounds of appeal (ITA No. 436/Rjt/2023 for AY 2018-19) raised by the assessee are as follows: (1) That, the Ld. CIT(A) has wrongly confirmed the disallowance of Rs. 64,549/- on account of VAT outstanding u/s 43B of the I.T. Act, 1961. (2) That, the Ld. CIT(A) has wrongly confirmed the disallowance of Rs. 2,57,795....

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.... the business of manufacturing, water storage tanks, and solar water heaters. The return of income for the year under consideration was filed on 31" October 2018, declaring total income of Rs. 9,19,070/-. The adjustment under section 143(1)(a) of the Income tax Act, in respect of which 30% of payments, on which TDS was not deducted under section 40(a)(ia) of the Act, amounting to Rs. 2,57,795/-, was made in the order under section 143(1) of the Act, dated 13.05.2019, by the assessing officer (CPC-assessing officer). 8. Aggrieved by the order of the assessing officer (CPC-assessing officer), the assessee, carried the matter in appeal, before the Id. CIT(A), who has confirmed the action of the assessing officer. The Id CIT(A) observed that....

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....d. Counsel also submitted CA certificate, which clearly stated that payee has included the sum in its return of income and paid the taxes thereon, hence addition should not be made in the hands of the assessee. 11. On the contrary, the Ld. DR for the revenue, submitted that the assessee has not submitted income tax returns of the payee before the assessing officer. Besides, the Ld. Counsel also submitted CA certificate, which stated that payee has included the sum in its return of income and paid the taxes thereon, however, such CA certificate has not been examined by the assessing officer, it is additional evidence before the Bench, therefore the matter may be restored back to the file of the assessing officer to examine the income tax ....

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....paid due tax on the returned income. We note the insertion of second proviso to section, 40(a)(ia) of the Act is curative in nature and so has retrospective effect w.e.f. 1^st April, 2005, being a date from which Section 40(a)(ia) of the Act was inserted by the Finance (No. 2) Act, 2004. In view of this, we are of the view that this matter needs fresh adjudication in the light of the decisions of the Hon'ble Delhi High Court in CIT v. Ansal Land Mark Township Pvt. Limited [ITA 160/2015 & 161/2015, dated 26/08/2015], wherein Hon'ble High Court upheld the decision of the Tribunal of Agra Bench in Rajiv Kumar Agarwal v. ACIT that the 2nd proviso to section 40(a)(ia) is curative amendment and has retrospective effect from 01/04/2005. Th....