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Income Tax Appellate Tribunal, “SMC” BENCH: KOLKATA
Before: Shri Mahavir Singh, JM]
For the Appellant: Shri D. C. Chakraborty, Advocate For the Respondent: Shri Rajendra Prasad, JCIT, Sr. DR ORDER This appeal by assessee is arising out of order of CIT(A)-7, Kolkata vide Appeal No. 17/CIT(A)-7/W-26(2)/14-15 dated 01.01.2015. Assessment was framed by ITO, Wd-53(2), Kolkata u/s. 143(3) of the Income-tax Act, 1961 (hereinafter referred to as “the Act”) for Assessment Year 2008-09 vide his order dated 27.10.2010.
The only issue in this appeal of assessee is against the order of CIT(A) confirming the addition of Rs.1,02,056/- being expenses of maintenance of colour word machine and a sum of Rs.1,32,712/- being payment of repairs and renewals for non- deduction of TDS by invoking the provisions of section 40(a)(ia) of the Act.
The contention of the assessee is that all payments are paid and no outstanding payment as on 31.03.2008. Ld. Counsel for the assessee was informed that now this issue stands covered in favour of revenue and against assessee by the decision of Hon’ble Calcutta High Court in the case of CIT Vs. Crescent Export Syndicate, of 2008 dated 30.07.2008, wherein it has been held as under:
“….It further appears from the assessment order that neither the Assessing Officer nor the CIT(Appeal) has disbelieved the genuineness of the transaction. There was no dispute that the purchases were genuine. Accordingly, in our opinion, the learned Tribunal has correctly came to the conclusion by deleting the addition of Rs.15,69,116/- under section 40A(3) of the Act. On the other ground as it appears that the CIT(Appeal) has been directed to reconsider the matter. In view of that we do not think that any substantial question of law is involved in this matter. Hence the appeal being of 2008 is dismissed.” Ld. Counsel for the assessee agreed to the proposition that the issue stands covered against the assessee and admittedly assessee has not deducted TDS on these two 2 Sri Sudip Das AY 2008-09 payments but he stated that now in view of amendment in section 40(a)(ia) of the Act by bringing the second proviso by Finance Act, 2012 is held to be retrospective by Hon’ble Delhi High Court in the case of CIT Vs. Ansal Land Mark Township (P) Ltd., ITA Nos. 160 & 161/2015 dated 26.08.2015, wherein it has been held as under: “No s. 40(a)(ia) disallowance for failure to deduct TDS on payment if payee has offered amount to tax. Second Proviso to s. 40(a)(ia) inserted by Finance Act 2013 w.e.f. 1.4.2013 should be treated as curative and to have retrospective effect from 1.4.2005. ITAT praised for "thorough analysis" of the provision”
In view of the above, the issue needs to be set aside to the file of AO. On query from the Bench, Ld. Sr. DR has not objected to the proposal. In view of the above facts and circumstances, we are of the considered view that let the AO examine the details of recipients of payments, which are to be filed by assessee and in case these receipts are included in their respective return of income and paid taxes thereon, the AO will delete the disallowance made u/s. 40(a)(ia) of the Act in view of the decision in the case of Ansal Land Mark township (P) Ltd., supra. This issue of assessee’s appeal is allowed for statistical purposes.
In the result, appeal of assessee is allowed for statistical purposes.
Order is pronounced in the open court on 09.12.2015. Sd/- (Mahavir Singh) Judicial Member Dated : 9th December, 2015 Jd.(Sr.P.S.) Copy of the order forwarded to:
APPELLANT – Shri Sudip Das, C/o Bharat Hardwares, Madarat Road, Baruipur, Kolkata-700 144 2 Respondent – ITO, Wd-26(2), Kolkata. 3. The CIT(A), Kolkata 4. CIT , Kolkata 5. DR, Kolkata Benches, Kolkata