Radhakrishna Foodland Carriers P.Ltd, ... vs Department Of Income Tax

Asstt.Commissioner of Income बनाम/ M/s RKHS Food and Allied Tax -8(3), Vs. Services P.Ltd., Room No.217, (Formerly known as M/s SHRM Ayakar Bhavan, Food and Allied services P.Ltd) M.K.Road, Kolsite House, Mumbai-400020 23-A Shah Industrial Estate, Off Veera Desai Road, Andheri (W), Mumbai-400053 (अपीलाथ /Appellant) .. ( यथ / Respondent)

थायी ले ख ा सं . /जीआइआर सं . /PAN/GIR No. :AAACT2529E

आयकर अपील सं./I.T.A. No.6858/Mum/2012 ( नधा रण वष / Assessment Year : 2009-10)

Asstt.Commissioner of Income बनाम/ M/s Radhakrishna Foodland Tax -8(3), Vs. Carriers Ltd. Room No.217, Radhakrishna House, Ayakar Bhavan, Majiwade Village Road, M.K.Road, Majiwade, Mumbai-400020 Thane-400601 (अपीलाथ /Appellant) .. ( यथ / Respondent)

थायी ले ख ा सं . /जीआइआर सं . /PAN/GIR No. :AABCR8854K

अपीलाथ ओर से / Appellant by Shri Love Kumar यथ क! ओर से/Respondents by Shri J D Mistry and Shri M A Gohel सन ु वाई क! तार%ख / Date of Hearing :3.3.2015 घोषणा क! तार%ख /Date of Pronouncement :3.3.2015 2 ITA. No.6886/Mum/2012 ITA No.6858/Mum/2012

आदे श / O R D E R

Per B.R.BASKARAN, Accountant Member:

Both the appeals are filed at the instant of Revenue are directed

against the separate orders passed by the ld. CIT(A)-18, Mumbai in the

hands of respective assessees and they relate to assessment year 2009-

10. Both the appeals were heard together and hence they are being

disposed of by this common order, for the sake of convenience.

2. One of the issues urged by both the assessees is identical in nature,

i.e., it relates to the decision of ld. CIT(A) in deleting the disallowance

made u/s 40(a)(ia) of the Income Tax Act, 1961 (the Act).

3. The facts relating to the above said disallowance are that the

assessee did not remit the tax deducted at source within the due date

prescribed in the relevant section, but remitted it before the due date for

filing the return of income. The AO took the view that the tax deducted at

source should have been remitted before the end of the financial year and

accordingly made the disallowance of the relevant expenditure by invoking

the provisions of section 40(a)(ia) of the Act.

4. The ld. CIT(A), however, deleted the disallowance so made by

following the decision of co-ordinate Bench of the Tribunal rendered in 3 ITA. No.6886/Mum/2012 ITA No.6858/Mum/2012

the case of Shri Piyush C Mehta V/s ACIT (2012) 52 SOT 27(AT).

Aggrieved, the Revenue has filed this appeal before us on this issue.

5. We heard the parties. The ld. counsel appearing on behalf of the

assessee submitted that the co-ordinate Bench of the Tribunal in the case

of Shri Piyush C Mehta (supra) has followed the decision rendered by the

Kolkatta High Court in the case of CIT V/s Virgin Creations in ITA No.302

of 2011 decided on 23.11.2011, wherein it was held that the amendment

brought into the section 40(a)(ia) w.e.f 1.4.2010 is clarificatory in nature

and hence it shall have retrospective effect. The said amendment

provided that the disallowance u/s 40(a)(ia) shall not be made, if the TDS

is remitted on or before the due date prescribed for filing of return of

income u/s 139(1) of the Act. The Ld Counsel submitted that the Ld

CIT(A) has followed the decision rendered by the co-ordinate bench to

decide this issue in favour of both the assessees. The Ld Counsel further

submitted that the Hon'ble Delhi High Court, in the case of CIT V/s

Naresh Kumar (2014) 362 ITR 256 (Del), has also taken identical view as

that of the Hon'ble Kolkatta High Court.

6. On the other hand, the ld. DR placed reliance on the decision of

Special Bench of the Tribunal rendered in the case of Bharti Ship Yard

reported in 132 ITD 53.

4 ITA. No.6886/Mum/2012 ITA No.6858/Mum/2012

7. We notice that the Hon'ble Kolkatta High Court in the case of Virgin

Creations (supra) as well as the Delhi High Court in the case of Naresh

Kumar (supra) have taken the view that the amendment brought intothe

section 40(a)(ia) of the Act by Finance Act, 2010 shall have retrospective

application. As stated earlier, the above said amendment provides that the

provisions of section 40(a)(ia) shall not apply if the tax deducted at source

is paid before the due date prescribed for filing of return of income u/s

139(1) of the Act. In the instant cases, there is no dispute that the TDS

amount has been paid before the due date prescribed for filing the return

of income u/s 139(1) of the Act. Since amendment brought by Finance

Act, 2010 into the sec. 40(a)(ia) of the Act has been held to have

retrospective effect, the relevant expenditure is not liable to be disallowed.

Since, we have followed the decisions rendered by the Hon'ble High

Courts, we do not agree with the contention of the ld. DR that the decision

rendered by Special Bench of the Tribunal in the case of Bharati Ship Yard

(supra) should be followed. Accordingly, we do not find any infirmity in

the order of the ld.CIT(A) on this issue.

8. In the appeal filed in the case of M/s RKHS Foods and Allied

Services P.Ltd, the Revenue has taken one more ground i.e disallowance

made u/s 40(a)(ia) for short deduction of tax at source. We notice that

the ld. CIT(A) has deleted the addition made u/s 40(a)(ia) for short

deduction of tax at source, by following the decision rendered by the 5 ITA. No.6886/Mum/2012 ITA No.6858/Mum/2012

Hon'ble Kolkatta High Court in the case of DCIT V/s S K Tekriwal reported

in 361 ITR 432. Since the Ld CIT(A) has followed the decision rendered by

the Hon'ble Calcutta High Court, we do not find any reason to interfere

with his decision on this issue.

9. In the result, both eh appeals of the revenue are dismissed.

Pronounced accordingly in the open court in the presence of both the

parties on 03-03-2015.

घोषणा खल ु े यायालय म) *दनांकः 3rd March, 2015 को क! गई ।

sd sd

(संजय गग /SANJAY GARG) (बी.आर. बा करन,/ B.R. BASKARAN) या यक सद य / Judicial Member लेखा सद य/Accountant Member

rd मंब ु ई Mumbai:3 March,2015. व. न.स./ SRL , Sr. PS

आदे श क! "#त%ल&प अ'े&षत/Copy of the Order forwarded to :

1. अपीलाथ / The Appellant

2. यथ / The Respondent.

3. आयकर आयु0त(अपील) / The CIT(A)- concerned

4. आयकर आयु0त / CIT concerned

5. 1वभागीय त न3ध, आयकर अपील%य अ3धकरण, मुंबई / DR, ITAT, Mumbai concerned

6. गाड फाईल / Guard file.

आदे शानस ु ार/ BY ORDER, true copy सहायक पंजीकार (Asstt. Registrar) आयकर अपील%य अ3धकरण, मुंबई /ITAT, Mumbai