DY. COMMISSIONER OF INCOME TAX, CIRCLE-1(1), HYDERABAD vs. AGA PUBLICATIONS LIMITED, HYDERABAD

PDF · subscribers
ITA 1025/HYD/2017Status: DisposedITAT Hyderabad06 June 2018AY 2010-112 pages

In favour of the assessee: the Revenue's appeal was dismissed. From the AI summary of this appeal.

AI SummaryDismissed

What did the Tribunal hold?

The Tribunal held that the disallowance under Section 40(a)(ia) should not be made when the recipient has offered the income in its return and paid the tax. This decision was based on the Supreme Court's ruling in CIT vs. Calcutta Export Company.

What were the facts?

The Revenue appealed against the CIT(A)'s order deleting a disallowance made under Section 40(a)(ia). The disallowance was based on the AO's view that tax was not deducted at source, but the recipient had offered the income and paid tax.

What were the issues?

Whether disallowance under Section 40(a)(ia) is warranted when the recipient has offered the income and paid tax, despite non-deduction at source.

Which sections of the Income-tax Act were involved?

Section 40(a)(ia)

AI-generated summary — verify with the full judgment below

Cases cited in this judgment(1)Show list

Detected automatically from the text. Citations are also linked where they appear in the judgment. The count shows how many other judgments on BharatTax rely on the same authority.

Income Tax Appellate Tribunal, Hyderabad ‘ B ‘ Bench, Hyderabad

Before: Smt. P. Madhavi Devi & Shri S.Rifaur Rahman

Hearing: 01.06.2018Pronounced: 06.06.2018

Per Smt. P. Madhavi Devi, J.M.

This is Revenue’s appeal for the A.Y 2010-11 against the order of the CIT (A)-1, Hyderabad, dated 21.02.2017, deleting the disallowance made by the AO u/s 40(a)(ia) of the Act, on the ground that the recipient has offered the income in its return of income and paid the tax.

2.

We find that this issue is covered in favour of the assessee by the decision of the Hon'ble Supreme Court in the case of CIT vs. Calcutta Export Company reported in (2018) 93 Taxmann.com 51 (S.C) wherein it was held that “Amended provision of section 40( a)( ia) should be interpreted liberally and equitable and applies retrospectively from the date when section 40( a)( ia) was inserted i:e., with effect from the Assessment Year 2005-

Page 1 of 2

ITA No 1025 of 2017AGA Publications Ltd Hyderabad.

06 so that an assessee should not suffer unintended and deleterious consequences beyond what the object and purpose of the provision mandates. As the developments with regard to section recorded above shows that the amendment was curative in nature, it should be given retrospective operation as if the amended provision existed even at the time of its insertion”.

3.

We find that in the case of the assessee, it has been held that the recipient has offered the tax in its return of income and paid taxes, and therefore, no disallowance u/s 40(a)(ia) of the Act is to be made and for coming to this conclusion, the CIT (A) has followed the correct legal position and also the decision of ITAT in assessee’s own case for the earlier A.Ys. Therefore, we see no reason to interfere with the order of the CIT (A).

3.

In the result, Revenue’s appeal is dismissed. Order pronounced in the Open Court on 6th June, 2018.

Sd/- Sd/- (S.Rifaur Rahman) (P. Madhavi Devi) Accountant Member Judicial Member

Hyderabad, dated 6th June 2018. Vinodan/sps

Copy to: 1 Dy. CIT, Circle 1(1) 8th Floor, C Block, Room No.836, IT Towers, Hyderabad 500004 2 M/s. AGA Publications Ltd, 396, Vartha Buildings, Lower Tank Bund Road, Hyderabad 500080 3 CIT (A)-1, Hyderabad 4 Pr. CIT – 1, Hyderabad 5 The DR, ITAT Hyderabad 6 Guard File

By Order

Page 2 of 2

More judgments on Section 40(a)(ia)

All 7,300 judgments and leading authorities on Section 40(a)(ia) →

Recent GST High Court judgments

Search GST case law →