SH. ASHOK KUMAR JAIN,LUDHIANA vs. ITO, W-V(1), LUDHIANA

आदेश/Order

The present appeals have been preferred by the assessee against the order dated 07.05.2018 of the Commissioner of Income Tax(Appeals)-2, Ludhiana [hereinafter referred to as ‘CIT(A)’]. First we shall take up appeal of the assessee relating to assessment year 2012-13 in ITA No. 900/Chd/2018.

ITA No. 900 & 901-Chd-2018- Sh. Ashok Kumar Jain, Ludhiana 2

ITA No.900/Chd/2018 (A. (A.Y. 2012-13):

appeal:- 1. That order passed u/s 250(6) of the Income-tax Act, 1961 by the Ld. CIT(A) -2, Ludhiana is against law and facts on the file in as much as he was not justified to arbitrarily uphold the action of the Ld. Assessing officer in disallowing a sum of Rs. 6,74,616/- by resort to provisions of section 40(a)(ia) of the Act.

as per the instructions of the client, he does not press ground No.2 of the

appeal. Ground No.2 of the appeal is, therefore, dismissed as ‘not

pressed’.

appeal which relates to the disallowance made by the Assessing officer of

Rs. 6,74,616/- for non-deduction of TDS under the provisions of section

40(a)(ia) of the Act.

the assessee had not deducted TDS on the aforesaid payments made to

certain parties, details of which have been given at page 4 of the impugned

order of the CIT(A), however, the respective payees have taken into

account these receipts while computing their income and have filed the

Income tax returns and the due taxes have been paid. He has invited the

ITA No. 900 & 901-Chd-2018- Sh. Ashok Kumar Jain, Ludhiana 3

attention of the Tribunal to the provisions of section 201 of the Income

Tax Act and has submitted that in such an event the assessee cannot be

termed as assessee in default. Further, inviting attention to the second

proviso to section 40(a)(ia) of the Act, the Ld. Counsel for the assessee has

submitted that where the assessee is not to be deemed as assessee in

default, the provisions of section 40(a)(ia) of the Act will not be attracted.

provisions, the assessee was required to furnish a certificate from the C.A.

to show that the respective payments have been taken into account by the

payees for the purpose of taxation. The Ld. DR has further submitted that

second proviso to section 40(a)(ia) of the Act is prospective in nature

applicable from 1.7.2012. That the aforesaid provisions cannot be applied

retrospectively.

In rebuttal, the Ld. Counsel for the assessee has relied upon the

decision of the Hon’ble Delhi High Court in the case of ‘CIT Vs. Ansal

Land Mark Township Private Limited’ [2015] 377 ITR 635 (Delhi).,

the record. As per the amended provision of section 40(a)(ia) of the Act,

if the assessee is not deemed to be assessee in default as per the

provisions of section 201 of the Act, the disallowance u/s 40(a)(ia) of the

Act is not attracted in respect of payments made without TDS. So far as the

retrospective applicability of these provisions of the Act is concerned,

the issue is now settled by the decision of the Hon'ble Delhi High Court in

the case of ‘CIT Vs. Ansal Land Mark Township Private Limited’ (supra)

ITA No. 900 & 901-Chd-2018- Sh. Ashok Kumar Jain, Ludhiana 4

and further by the decision of the Hon'ble jurisdictional Punjab & Haryana

High Court in the case of ‘PCIT-2, Chandigarh Vs. M/s Mobisoft

Telesolutions Private Limited’ in ITA No. 495 of 2017 (O&M) order dated

3.10.2018, wherein, the findings so arrived at by the Hon'ble Delhi High

Court in the case of ‘CIT Vs. Ansal Land Mark Township Private Limited,

(supra) have been reaffirmed. No distinguishing case law has been put

before us by the Department.

Certificate of the C.A., the Ld. Counsel for the assessee has submitted that

though the assessee had contacted the aforesaid parties and they have

disclosed that the receipts have been taken into account, however, there

was some reluctance on the part of the parties to furnish the certificate

from the accountant. The Ld. Counsel for the assessee has submitted that

he will furnish the said certificate before the Assessing officer.

officer to examine afresh the contention of the assessee and if it is found

that the respective payees have taken into account the receipts received

from the assessee, filed their returns, paid the due taxes, then the

impugned disallowance u/s 40(a)(ia) of the Act will not be attracted.

With the above observations, the appeal of the assessee is treated as

allowed for statistical purposes.

ITA No. 901/Chd./2018 (A.Y. 2013-14)

ITA No. 900 & 901-Chd-2018- Sh. Ashok Kumar Jain, Ludhiana 5

such, he intends to withdraw the present appeal. The Ld. DR has no objection for the said withdrawal.

In view of the above, permission is hereby granted to the assessee to withdraw the appeal. Consequently, this appeal of the assessee is hereby dismissed as ‘Withdrawn’

Order dictated and pronounced in the Open Court immediately on completion of hearing.

(संजय गग� / SANJAY GARG) �या�यक सद�य/ Judicial Member Dated : 19.12. 2018 “आर.के.” आदेश क� ��त�ल�प अ�े�षत/ Copy of the order forwarded to : 1. अपीलाथ�/ The Appellant 2. ��यथ�/ The Respondent 3. आयकर आयु�त/ CIT 4. आयकर आयु�त (अपील)/ The CIT(A) 5. �वभागीय ��त�न�ध, आयकर अपील�य आ�धकरण, च�डीगढ़/ DR, ITAT, CHANDIGARH 6. गाड� फाईल/ Guard File

आदेशानुसार/ By order, सहायक पंजीकार/ Assistant Registrar