M/s. Matrix Glass & Structures Pvt. Ltd., Kolkata v. ITO, Ward - 6(2), Kolkata, Kolkata

ITA 658/KOL/2010 | 2006-2007
Pronouncement Date: 28-01-2011

Appeal Details

RSA Number 65823514 RSA 2010
Assessee PAN AAACG9574A
Bench Kolkata
Appeal Number ITA 658/KOL/2010
Duration Of Justice 9 month(s) 23 day(s)
Appellant M/s. Matrix Glass & Structures Pvt. Ltd., Kolkata
Respondent ITO, Ward - 6(2), Kolkata, Kolkata
Appeal Type Income Tax Appeal
Pronouncement Date 28-01-2011
Appeal Filed By Assessee
Bench Allotted A
Tribunal Order Date 28-01-2011
Date Of Final Hearing 06-07-2010
Next Hearing Date 06-07-2010
Assessment Year 2006-2007
Appeal Filed On 05-04-2010
Judgment Text
IN THE INCOME-TAX APPELLATE TRIBUNAL A BENCH : KOLKATA [ BEFORE HONBLE SHRI B.R. MITTAL JM AND HONBLE S HRI C. D. RAO AM ] ITA NO. 658 (KOL) OF 2010 : ASSESSMENT YEAR : 2006 -07 M/S. MATRIX GLASS & STRUCTURES PVT. LIMITED -VS.- INCOME TAX OFFICER WARD- 6(2) KOLKATA [PAN : AAACG 9574 A] KOLKATA. [APPE LLANT] [RESPONDENT] APPELLANT BY : SHRI P. K. AGR AWAL RESPONDENT BY : SHRI PIYUSH KOL HE PER B. R. MITTAL J. M. THE ASSESSEE HAS FILED THIS APPEAL FOR ASSESSMENT Y EAR 2006-07 AGAINST ORDER OF LD. CIT(A)-VI KOLKATA DATED 14.12.2010 ON THE FOLLOWIN G GROUNDS :- (1) FOR THAT THE LD. CIT(A) ERRED IN UPHOLDING THE DECI SION OF THE A.O. IN DISALLOWING THE FREIGHT PAID RS.15 76 761/- (OUT OF GROSS DISALLOWANCE OF RS.29 76 643/-) INVOKING THE PROVIS IONS OF SECTION 40(A)(IA) OF THE INCOME TAX ACT 1961 FOR THE ALLEG ED FAILURE TO DEDUCT TAX AT SOURCE AS REQUIRED UNDER THE PROVISIO N OF SECTION 194C OF THE INCOME TAX ACT 1916 (HEREINAFTER REFER RED TO AS ACT) AND HIS PURPORTED FINDINGS ON THAT BEHALF AR E WHOLLY ARBITRARY UNWARRANTED AND PERVERSE. (2) FOR THAT LD. A.O. AS WELL AS LD. CIT(A) BOTH HAD ER RED IN FACT IN HOLDING THAT FREIGHT PAID RS.9 96 151/- (RS.11 58 3 02/- LESS PART ALLOWED BY THE LD. CIT(A) FOR RS.1 62 151/-) (OUT O F GROSS DISALLOWANCE OF RS.29 76 643/-) WERE WITHIN THE PUR VIEW OF SECTION 194C AND THEREFORE INVOCATION OF SEC. 40(A )(IA) OF THE ACT IN DISALLOWING PARENT EXPENDITURE FOR NON-DEDUCTION OF TDS WAS BAD IN LAW. (3) FOR THAT NO TDS WAS REQUIRED TO BE MADE UNDER SECTI ON 194C OF THE ACT WHERE THE AMOUNT OF ANY SUM PAID OR CREDITE D TO SUB- CONTRACTORS DID NOT EXCEED RS.20 000/- OR IT DID NO T EXCEED RS.50 000/- BEING AGGREGATE AMOUNT OF SUCH SUM DURI NG THE FINANCIAL YEAR AND IN THESE CASES SECTION 40(A)(IA) WOULD NOT BE INVOKED UNDER THE FACTS AND CIRCUMSTANCES OF THE CA SE. (4) FOR THAT LD. A.O. AS WELL AS LD. CIT(A) BOTH HAD ER RED IN FACT IN HOLDING THAT LOADING AND UNLOADING CHARGES PAID RS. 2 41 580/- (OUT OF GROSS DISALLOWANCE OF RS.29 76 643/-) WERE WITHI N THE PURVIEW OF SECTION 194C AND THEREFORE INVOCATION OF SECTIO N 40(A)(IA) OF ITA NO. 658/KOL/20 10 2 THE ACT IN DISALLOWING PARENT EXPENDITURE FOR NON-D EDUCTION OF TDS WAS BAD IN LAW. (5) FOR THAT LD. A.O. AS WELL AS LD. CIT(A) HAD ERRED I N DISALLOWING THE AMOUNT OF EXPENSES WHICH WERE ACTUALLY PAID WIT HIN THE PREVIOUS YEAR WITHOUT TDS U/S. 40(A)(IA) OF THE ACT . (6) FOR THAT THE AO HAD ERRED IN DISALLOWING I N FACT AS WELL AS IN LAW RS.21 42 270/- TOWARDS TRANSPORTATION CHARGES PAID TO DIFFERENT PARTIES FOR NON-FURNISHING OF NAMES AND ADDRESSES O F THE PARTIES AND SAME DISALLOWANCE WAS CONFIRMED BY LD. CIT(A) F OR VIOLATION OF SECTION 40(A)(IA) OF THE ACT ON A DIFFERENT GROU ND FROM THAT OF THE A.O. 2. SUBSEQUENTLY ASSESSEE HAS REVISED GROUND NO.2 O F THE APPEAL WHICH READS AS UNDER :- FOR THAT LD. A.O. AS WELL AS LD. CIT(A) BOTH HAD E RRED IN FACT IN HOLDING THAT FREIGHT PAID RS.11 58 302/- (OUT OF GR OSS DISALLOWANCE OF RS.29 76 643/-) WERE WITHIN THE PURVIEW OF SECTI ON 194C AND THEREFORE INVOCATION OF SEC. 40(A)(IA) OF THE ACT IN DISALLOWING PARENT EXPENDITURE FOR NON-DEDUCTION OF TDS WAS BAD IN LAW. 3. THE ASSESSEE IS A COMPANY AND CARRIED OUT THE BU SINESS OF TRANSPORTATION OF GOODS FOR WHICH IT RECEIVED TRANSPORTATION CHARGES AND ALSO P AID TRANSPORTATION CHARGES TO SUB-CONTRACTORS. THE ASSESSEE WAS ALSO ENGAGED IN DEALING IN SHARES. THE ASSESSEE FILED RETURN DECLARING NIL INCOME. 4. DURING ASSESSMENT PROCEEDINGS ASSESSING OFFICER OBSERVED THAT ASSESSEE HAD NOT DEDUCTED TDS IN RESPECT OF FOLLOWING :- TDS NOT DEDUCTED : ON FREIGHT PAID RS.15 76 761/- TRANSPORTATION CHARGES PAID RS. 9 96 151/- LOADING AND UNLOADING CHARGES PAID RS. 4 03 731 /- RS.29 76 643/- THE ASSESSING OFFICER HAS STATED THAT ASSESSEE WAS ASKED TO EXPLAIN WHY THE ABOVE MENTIONED AMOUNT SHOULD NOT BE DISALLOWED U/S. 40(A)(IA) OF T HE ACT FOR NON-DEDUCTION OF TDS. THE ASSESSEE STATED THAT THOSE PARTIES WERE BELOW TAXAB LE LIMIT. SINCE THE ASSESSEE COULD NOT FURNISH ANY DETAILS/DOCUMENTARY EVIDENCE IN SUPPORT OF ITS EXPLANATION ASSESSING OFFICER DISALLOWED THE SAID SUM OF RS.29 76 643/- U/S. 40(A)(IA) OF THE AC T AND ADDED TO THE INCOME OF THE ASSESSEE. ITA NO. 658/KOL/20 10 3 5. BESIDES ABOVE ASSESSEE CLAIMED TO HAVE PAID TRA NSPORTATION CHARGES TO DIFFERENT PARTIES. THE ASSESSING OFFICER HAS STATED THAT THE ASSESSEE COULD NOT FURNISH THE NAMES AND ADDRESSES OF THE PARTIES WITH ANY EVIDENCE AND ACCORDINGLY ASSE SSING OFFICER TREATED THE SAID CLAIM OF THE ASSESSEE FOR PAYMENT OF TRANSPORTATION CHARGES OF R S.21 42 279/- AS BOGUS AND ADDED THE AMOUNT TO THE TOTAL INCOME OF THE ASSESSEE. 6. THE ASSESSING OFFICER COMPLETED THE ASSESSMENT COMPUTING TOTAL BUSINESS INCOME AT RS.59 03 179/- AND AFTER SETTING OFF OF BROUGHT FOR WARD LOSSES FINALLY ASSESSED THE TAXABLE INCOME AT RS.43 44 620/-. BEING AGGRIEVED THE ASSES SEE FILED APPEAL BEFORE THE 1ST APPELLATE AUTHORITY. 7. IT IS OBSERVED FROM PAGE 3 OF LD. CIT(A)S IMPUG NED ORDER THAT THE ASSESSEE STATED BEFORE HIM THAT THERE WAS DIFFERENCE IN AMOUNT ON WHICH TD S WAS NOT MADE AS PER ASSESSMENT ORDER AND AS PER BOOKS OF ACCOUNT. THE SAID TABLE IS GIVE N AT PAGE 3 OF ORDER OF THE LD. CIT(A) WHICH IS AS UNDER :- SL.NO. HEAD OF ACCOUNT AMOUNT AS PER ASSTT. ORDER AMOUNT AS IT SHOULD BE 1. FREIGHT PAID RS.15 76 761/- RS.15 75 910/- 2. TRANSPORTATION CHARGES RS. 9 96 151/- RS.11 5 8 302/- 3. LOADING AND UNLOADING CHARGES RS. 4 03 731/- RS. 2 41 580/- TOTAL RS.29 76 643/- RS.29 75 792/- 8. THE LD. CIT(A) HAS CONFIRMED THE ADDITION MADE B Y THE ASSESSING OFFICER ON ACCOUNT OF FREIGHT PAID I.E. RS.15 76 761/- ADDITION MADE ON ACCOUNT OF TRANSPORTATION CHARGES OF RS.11 58 302/- AND HAS ALSO CONFIRMED THE TRANSPORT ATION CHARGES AFTER REJECTING THE CONTENTION OF THE ASSESSEE THAT THE PAYMENT OF RS.1 62 151/- AMO UNT PAID TO MAA KALI ENTERPRISES IS NOT TRANSPORTATION CHARGES BUT IT IS TOWARDS LOADING CH ARGES AS PER LEDGER ACCOUNT AND THEREFORE CONFIRMED LOADING AND UNLOADING CHARGES OF RS.2 41 580/-. THE LD. CIT(A) HAS ALSO CONFIRMED THE DISALLOWANCE OF RS.21 42 279/- CLAIMED TOWARDS TRANSPORTATION CHARGES PAID TO DIFFERENT PARTIES ON THE GROUND THAT TDS WAS REMITTED ON 31.0 5.2006 THOUGH THE PAYMENT WAS MADE IN OCTOBER 2005. HENCE THE ASSESSEE IS IN FURTHER AP PEAL BEFORE THE TRIBUNAL. 9. IN RESPECT OF GROUND NO.1 OF THE APPEAL DISPUTIN G DISALLOWANCE OF FREIGHT PAID OF ITA NO. 658/KOL/20 10 4 RS.15 76 761 THE ASSESSEE CONTENDED BEFORE THE LD. CIT(A) THAT IT COMPRISED OF AN AMOUNT OF RS.4 77 637/- WHERE PAYMENTS WERE MADE TO INDIVIDUA L PERSONS AND EACH PAYMENT WAS LESS THAN RS.20 000/- AND THEREFORE TDS WAS NOT REQUIRED TO BE DEDUCTED IN REGARD THERETO. IT WAS FURTHER CONTENDED BEFORE THE LD. CIT(A) THAT FOR THE BALANC E AMOUNT OF RA.10 98 273/- OUT OF RS.15 76 761/- THE PAYMENT WAS SUPPORTED BY 15-I F ORM. THE LD. CIT(A) CALLED FOR REMAND REPORT AND ASSESSING OFFICER INFORMED THAT FORM 15- J WAS NOT SUBMITTED BEFORE THE JURISDICTIONAL CIT AS ADMITTED BY ASSESSEES REPRESENTATIVE AT THE TIME OF REMAND PROCEEDINGS. THE ASSESSEE- COMPANY ALSO ADMITTED IN ITS COMMENTS FILED ON 05.1 0.2009 TO HAVE MISPLACED EVIDENCES FOR SUBMISSION OF FORMS 15-I AND SAME COULD NOT BE PROD UCED. THE LD. CIT(A) HAS FURTHER STATED THAT ASSESSEE DID NOT FURNISH THE DETAILS OF BELOW RS.20 000/- PAYMENTS AT THE TIME OF ASSESSMENT. THE LD. CIT(A) HAS FURTHER STATED THAT IN THE REMAN D REPORT THE ASSESSING OFFICER MENTIONED THAT ALL THOSE PAYMENTS WERE MADE BY SELF VOUCHERS AND L IABLE FOR DISALLOWANCE. THE LD. CIT(A) HAS STATED THAT VOUCHERS PRODUCED BEFORE HIM ARE SELF M ADE AND DO NOT CONTAIN NAME OF THE PERSONS TO WHOM THE PAYMENTS ARE MADE. THE LD. CIT(A) HAS S TATED THAT THE ASSESSEE COULD NOT SATISFACTORY PROVE BEFORE HIM THAT THE PAYMENTS WER E BELOW RS.20 000/- AND AGGREGATE PAYMENTS IN THE FINANCIAL YEAR DID NOT EXCEED RS.50 000/- FO R AN INDIVIDUAL PAYEE. ACCORDINGLY THE LD. CIT(A) HAS CONFIRMED THE ADDITION OF RS.15 76 761/- . HENCE THE ASSESSEE IS IN FURTHER APPEAL BEFORE THE TRIBUNAL. 10. AT THE TIME OF HEARING LD. AUTHORISED REPRESEN TATIVE FOR THE ASSESSEE FIRSTLY SUBMITTED THAT THE PROVISIONS OF SECTION 40(A)(IA) ARE NOT AP PLICABLE AS THE ASSESSEE ACTUALLY PAID THE AMOUNT AND INCURRED EXPENDITURE. THEREFORE NO DISA LLOWANCE COULD BE MADE AS THE EXPENDITURE WAS INCURRED BY THE ASSESSEE FOR ITS BUSINESS PURPO SES AND THE SAME IS COVERED BY SECTION 28 OF THE ACT. THE LD. AUTHORISED REPRESENTATIVE FOR THE ASSESSEE SUBMITTED THAT PROVISION OF SECTION 40(A)(IA) OF THE ACT ARE APPLICABLE ONLY TO EXPENDI TURE ALLOWABLE U/S. 38 OF THE ACT AND NOT TO THE EXPENDITURE ALLOWABLE U/S. 28 OF THE ACT. THE LD. A UTHORISED REPRESENTATIVE FOR THE ASSESSEE FURTHER SUBMITTED THAT PROVISIONS OF SECTION 40(A) (IA) ARE APPLICABLE ONLY TO THE AMOUNT PAYABLE AND DOES NOT INCLUDE PAID. HE SUBMITTED THAT IF TH E EXPENDITURE HAS ALREADY BEEN PAID NO SUCH DISALLOWANCE CAN BE MADE U/S. 40(A)(IA) OF THE ACT. 10.1 THE LD. AUTHORISED REPRESENTATIVE FOR THE ASSE SSEE FURTHER REFERRED PAGES 14 TO 18 OF THE ITA NO. 658/KOL/20 10 5 PAPER BOOK FILED ALONGWITH MEMO OF APPEAL AND SUBMI TTED THAT IT CONTAINS DETAILS OF THE FREIGHT PAID BY THE ASSESSEE FOR HIRING TRUCKS. THE LD. AUT HORISED REPRESENTATIVE FOR THE ASSESSEE SUBMITTED THAT OUT OF THE TOTAL PAYMENTS OF RS.15 7 6 761/- AN AGGREGATE AMOUNT OF RS.4 77 637/- WAS PAID WHEREIN EACH PAYMENT WAS BELOW RS.20 000/- AND AGGREGATED PAYMENT MADE IN THE FINANCIAL YEAR TO EACH OF THE TRUCK DID NOT EXCEED RS.50 000/-. HE SUBMITTED THAT PROVISIONS OF SECTION 194C COULD NOT APPLY TO THE ABOVE AMOUNT AG GREGATING TO RS.4 77 637/- HE SUBMITTED THAT ASSESSEE FURNISHED REQUISITE DETAILS TRUCK-WIS E OF THE ABOVE PAYMENT TO THE ASSESSING OFFICER AS WELL AS TO THE LD. CIT(A). THE LD. AUTHORISED RE PRESENTATIVE FOR THE ASSESSEE FURTHER SUBMITTED THAT IN RESPECT OF BALANCE AMOUNT OF RS.1 0 98 273/- OUT OF SAID AMOUNT OF RS.15 76 761/- TDS WAS NOT DEDUCTED AS THE ASSESSE E RECEIVED FORM 15-I FROM TRUCK OWNERS AND REFERRED PAGES 14 TO 18 OF THE PAPER BOOK FILED WIT H MEMO. OF APPEAL. HE SUBMITTED THAT ASSESSEE HIRED TRUCK FROM LOCAL MARKETS AS AND WHEN THERE WA S A REQUIREMENT FOR TRANSPORTATION OF GOODS. SINCE TRUCK OWNERS PROVIDED FORM 15-I FOR NON-DEDUC TION OF TAX AT SOURCE THE ASSESSEE DID NOT DEDUCT TDS AND IN SUPPORT OF HIS SUBMISSION RELIED ON THE DECISION OF I.T.A.T. KOLKATA BENCH IN THE CASE OF MRS. KAVITA CHUG VS. I.T.O. [2010] 45 DTR (KOL) (TRIB) 146. 10.2 THE LD. AUTHORISED REPRESENTATIVE FOR THE ASSE SSEE SUBMITTED THAT THE SAID DISALLOWANCE OF RS.15 76 761/- SHOULD BE DELETED. 11. ON THE OTHER HAND THE LD. DEPARTMENTAL REPRESE NTATIVE SUBMITTED THAT PROVISIONS OF SECTION 40(A)(IA) OF THE ACT APPLY TO ALL PAYMENTS IF TDS IS NOT DEDUCTED BY THE ASSESSEE AS PER PROVISIONS OF THE ACT. HE FURTHER SUBMITTED THAT I. T.AT. CALCUTTA BENCH HAS CONSIDERED VIDE ITS ORDER DATED 15.01.2010 IN ITA NO. 1418/KOL/2009 IN THE CASE OF PODDAR SONS EX.L.(P) LTD. VS. I.T.O. THAT EVEN IF SUM PAYABLE ARE PAID TO THE CO NTRACTORS OR SUB-CONTRACTORS ON WHICH TAX IS DEDUCTIBLE AT SOURCE THE PROVISIONS OF ACT 40(A) (IA) WILL BE ATTRACTED IF NO TDS IS DEDUCTED. THE LD. DEPARTMENTAL REPRESENTATIVE FURTHER SUBMITT ED THAT THE ASSESSEE COULD NOT FURNISH SATISFACTORILY THE DETAILS THAT IT MADE PAYMENTS BE LOW RS.20 000/- TO AN INDIVIDUAL AT A TIME AND TOTAL AMOUNT DID NOT EXCEED RS.50 000/- TO AN INDIV IDUAL IN RESPECT OF AGGREGATE PAYMENT OF RS.4 77 637/-. THE LD. DEPARTMENTAL REPRESENTATIVE REFERRED TO PAGES 14 TO 18 OF THE PAPER BOOK FILED WITH MEMO. OF APPEAL AND SUBMITTED THAT ASSES SEE HAS ONLY GIVEN TRUCKS NUMBER BUT NAMES AND ADDRESSES OF PAYEES ARE NOT STATED. THE LD. DEP ARTMENTAL REPRESENTATIVE FURTHER REFERRED TO ITA NO. 658/KOL/20 10 6 REMAND REPORT DATED 09.07.2009 COPY PLACED ON RECO RD AND SUBMITTED THAT SAID PAYMENTS WERE REFLECTED ONLY BY SELF MADE VOUCHERS AND THEREFORE THE LD. CIT(A) HAS RIGHTLY CONFIRMED THE ORDER OF THE ASSESSING OFFICER FOR MAKING DISALLOWA NCE OF IT. THE LD. DEPARTMENTAL REPRESENTATIVE FURTHER SUBMITTED THAT IN RESPECT OF BALANCE AMOUNT OF RS.10 98 273/- OUT OF RS.15 76 761/- THE ASSESSEE STATED THAT IT OBTAINE D FORM 15-I FROM TRUCK OWNERS BUT ADMITTEDLY THE SAID FORM 15-I ALONGWITH FORM 15-J WAS NOT SUBM ITTED BEFORE THE JURISDICTIONAL CIT. THE LD. DEPARTMENTAL REPRESENTATIVE FURTHER SUBMITTED T HAT THE ASSESSEE ALSO COULD NOT SUBSTANTIATE OF SUBMITTING FORM 15-I AS THE ASSESSEE TOOK PLEA T HAT IT MISPLACED THE SAID FORMS. THE LD. DEPARTMENTAL REPRESENTATIVE SUBMITTED THAT NO DETAI LS OF PERSONS TO WHOM PAYMENTS WERE MADE HAVE BEEN FILED AND ONLY TRUCK NUMBERS ARE GIVEN. T HEREFORE THE LD. CIT(A) IS ALSO JUSTIFIED TO CONFIRM THE DISALLOWANCE MADE BY THE ASSESSING OFFI CER OF RS.10 98 273/- OUT OF RS.15 76 761/-. THE LD. DEPARTMENTAL REPRESENTATIVE SUBMITTED THAT GROUND NO1 OF THE APPEAL TAKEN BY THE ASSESSEE BE REJECTED. 12. WE HAVE CAREFULLY CONSIDERED THE ORDERS OF THE AUTHORITIES BELOW AND THE SUBMISSIONS OF THE LD. REPRESENTATIVES OF BOTH THE PARTIES. WE HAV E CAREFULLY PERUSED PAGES 14 TO 18 OF THE PAPER BOOK FILED ALONGWITH MEMO. OF APPEAL AND HAVE ALSO CONSIDERED REMAND REPORT OF THE ASSESSING OFFICER DATED 09.07.2009 PLACED AT PAGES 28 TO 32 OF THE PAPER BOOK. WE HAVE ALSO GONE THOUGH THE CASE LAW CITED BY THE LD. AUTHORISE D REPRESENTATIVE FOR THE ASSESSEE. 13 AT THE OUT SET WE MAY STATE THAT GENERAL PLEA T AKEN BY THE LD. AUTHORISED REPRESENTATIVE FOR THE ASSESSEE IN REGARD TO NON-APPLICABILITY OF PROVISIONS OF SECTION 40(A)(IA) OF THE ACT IN RESPECT OF FREIGHT PAID AND NON DEDUCTION OF TDS E VEN IF ASSESSEE IS REQUIRED TO DEDUCT TDS AS PER PROVISIONS OF SECTION 194C OF THE ACT HAS NO ME RIT. SECTION 194C OF THE ACT PROVIDES DEDUCTION OF TDS IF PAYMENT IS MADE TO CONTRACTORS FOR CARRYING OUT ANY WORK IN PURSUANCE OF CONTRACT AND IF THE TOTAL PAYMENTS MADE EXCEEDS THE LIMIT PRESCRIBED THEREIN. FURTHER AS PER CLAUSE (IV) OF THE EXPLANATION WORK SHALL INCLUDE C ARRIAGE OF GOODS OR PASSENGERS BY ANY MODE OF TRANSPORT OTHER THAN BY RAILWAYS. THERE IS NO DISPU TE TO THE FACT THAT THE ASSESSEE IS ENGAGED IN TRANSPORTATION OF GOODS. FURTHER WE ALSO DO NOT AG REE WITH THE LD. AUTHORISED REPRESENTATIVE FOR THE ASSESSEE THAT PROVISIONS OF SECTION 40(A)(IA) O F THE ACT WILL NOT APPLY TO THE AMOUNT ALREADY PAID AND IT APPLIES ONLY AMOUNT PAYABLE. WE MAY STA TE THAT PROVISIONS OF SECTION 40(A)(IA) OF THE ITA NO. 658/KOL/20 10 7 ACT APPLY ONLY IF ASSESSEE IS REQUIRED TO DEDUCT TD S AS PER PROVISIONS OF THE ACT AND ASSESSEE FAILS TO DEDUCT TDS WHEN AMOUNT IS PAID/CREDITED TO THE ACCOUNT OF A PAYEE. THEREFORE IF AMOUNT IS STILL PAYABLE THE QUESTION OF DEDUCTING TDS THE REON AT THAT STAGE DOES NOT ARISE AND CONSEQUENTLY THE PROVISIONS OF SECTION 40(A)(IA) O F THE ACT WILL NOT BE ATTRACTED FOR MAKING DISALLOWANCE AS THE AMOUNT IS YET TO BE PAID OR CRE DITED TO THE ACCOUNT OF PAYEE. HENCE IF WE ACCEPT CONTENTION OF THE LD. AUTHORISED REPRESENTAT IVE FOR THE ASSESSEE PROVISIONS OF SECTION 40(A)(IA) OF THE ACT WILL BECOME REDUNDANT. I.T.A.T . CALCUTTA BENCH VIDE ITS ORDER DATED 15.01.2010 (SUPRA) HAS HELD THAT EVEN IF THE SUM PA YABLE ARE PAID TO THE CONTRACTORS OR SUB- CONTRACTORS ON WHICH TAX IS DEDUCTIBLE AT SOURCE AS PER PROVISIONS OF THE ACT SECTION 40(A)(IA) OF THE ACT WILL BE ATTRACTED. WE ARE OF THE CONSIDERED VIEW THAT THE ABOVE VIEW IS IN CONSONANCE WITH THE PROVISIONS OF THE ACT. IT IS WELL SETTLED THAT EXPRESSION USED IN THE STATUTE IS NOT ALWAYS T O BE INTERPRETED LITERALLY OR GRAMMATICALLY IF A PLA IN LITERAL INTERPRETATION OF STATUTORY PROVISIONS PRODUCED MANIFESTLY ABSURD AN UNJUST RESULT WHICH THE LEGISLATURE COULD NOT HAVE INTENDED. SOMETIMES IT HAS TO BE INTERPRETED HAVING REGARD T O THE CONTEST IN WHICH THE EXPRESSION IS USED AND HAVING REGARD TO THE JOB AND PURPOSE FOR WHICH THE SAME IS INDICATED. THEREFORE TERM USED IN SECTION 40(A)(IA) OF THE ACT PAYABLE MEANS THE AMOU NT ALREADY PAID OR CREDITED AND DOES NOT MEAN THE AMOUNT YET TO BE PAID OR CREDITED. HENCE WE REJECT THE CONTENTION OF LD. AUTHORISED REPRESENTATIVE THAT NO DISALLOWANCE COULD BE MADE U /S. 40(A)(IA) OF THE ACT IN RESPECT OF ITS BUSINESS EXPENDITURE IF ASSESSEE HAS FAILED TO DEDU CT TDS AS PER PROVISIONS OF ACT. WE MAY STATE THAT IF THE ASSESSEE IS REQUIRED TO DEDUCT TDS AS P ER PROVISIONS OF THE ACT ON THE PAYMENTS MADE BY THE ASSESSEE AND IF ASSESSEE FAILS TO DO SO THE PROVISIONS OF SECTION 40(A)(IA) WILL BE ATTRACTED. 14. NOW COMING TO DISALLOWANCE OF FREIGHT PAID WE OBSERVE THAT THE ASSESSEE HAS FILED DETAILS AT PAGES 14 TO 18 OF THE PAPER BOOK WITH ME MO. OF APPEAL GIVEN ALONGWITH TRUCK NUMBERS. AGGREGATE AMOUNT OF RS.15 76 761/- IS BIFURCATED IN TWO PARTS I.E. RS.4 77 637/- AND RS.10 98 273/-. IT IS STATED THAT INDIVIDUAL PAYMEN TS MADE TO TRUCK OWNERS DID NOT EXCEED RS.20 000/-. THE ASSESSEE HAS STATED THAT IT MADE R EQUISITIONS OF TRUCKS ON DAILY BASIS FOR TRANSPORTATION OF GOODS. WE OBSERVE THAT THE AUTHOR ITIES BELOW HAS REJECTED THE CLAIM OF THE ASSESSEE ON THE GROUND THAT THE PAYMENT IS SUPPORTE D BY SELF MADE VOUCHERS. HOWEVER WE OBSERVE THAT THE DEPARTMENT HAS NOT DISPUTED THAT T HE PAYMENT TO EACH OF THE TRUCK OWNER EXCEEDED RS.20 000/- AT A TIME AND/OR TOTAL PAYMENT TO AN INDIVIDUAL IN FINANCIAL YEAR WAS MORE ITA NO. 658/KOL/20 10 8 THAN RS.50 000/-. WE ARE OF THE CONSIDERED VIEW THA T WHEN THE ASSESSEE HAS GIVEN TRUCK NUMBERS INDICATING THE DETAILS OF PAYMENT MADE AGGREGATING RS.4 77 637/- AND IN THE ABSENCE OF ANY EVIDENCE CONTRARY TO IT BROUGHT ON RECORD WE HOLD THAT DISALLOWANCE CANNOT BE MADE U/S. 40(A)(IA) OF THE ACT AS PRIMA FACIE NO TDS IS REQUI RED TO BE DEDUCTED ON THE SAID PAYMENT AS PER PROVISIONS OF SECTION 194C OF THE ACT. HENCE WE HO LD THAT SAID ADDITION OF RS.4 77 637/- OUT OF RS.15 76 761/- FROM FREIGHT PAID IS NOT JUSTIFIED A ND SAME IS DELETED. 14.1 IN RESPECT OF BALANCE AMOUNT OF RS.10 98 273/ - THE ASSESSEE HAS ADMITTED THAT EACH OF THE PAYMENT AT A TIME EXCEEDED RS.20 000/- BUT HAS STATED THAT TDS WAS NOT DEDUCTED AGAINST FORMS 15-I RECEIVED. WE OBSERVE THAT THE ASSESSEE C OULD NOT SUBSTANTIVE ITS STAND THAT THE ASSESSEE RECEIVED FORM 15-I FROM THE RESPECTIVE TRU CK OWNERS WHERE THE PAYMENT WAS EXCEEDING RS.20 000/-. FURTHER THE ASSESSEE COULD NOT ALSO S UBSTANTIATE WITH DOCUMENTARY EVIDENCE THAT IT FILED FORM 15-J ALONGWITH FORMS 15-I TO THE CONCERN ED LD. CIT. 14.2 ON THE OTHER HAND WE OBSERVE THAT ASSESSEE FI LED ITS LETTER DATED 05.10.2009 AND ADMITTED IN HIS COMMENT TO REMAND REPORT THAT IT HAD MISPLAC ED EVIDENCES OF FORM 15-I AND SAME COULD NOT BE PRODUCED. 14.3 CONSIDERING THE ABOVE FACTS WE HOLD THAT DISA LLOWANCE OF RS.10 98 273/- AS PER PROVISIONS OF SECTION 40(A)(IA) OF THE ACT IS JUSTI FIED AS THE ASSESSEE FAILED TO DEDUCT TDS AS PER PROVISIONS OF SECTION 194C OF THE ACT. 15. IN VIEW OF THE ABOVE WE ALLOW GROUND NO.1 OF T HE APPEAL TAKEN BY THE ASSESSEE IN PART BY DELETING SUM OF RS.4 77 637/- AND RESTRICTING THE DISALLOWANCE TO RS.10 98 273/- UNDER THE HEAD FREIGHT PAID. 16. IN RESPECT OF REVISED GROUND NO.2 OF THE APPEAL OF DISALLOWANCE OF RS.11 58 302/- UNDER THE HEAD TRANSPORTATION CHARGES THE LD. CIT(A) HAS STATED THAT THE ASSESSEE HAS NOT GIVEN DETAILS OF TRANSPORTERS TO VERIFY WHETHER PROVISIONS OF SEC TION 194C WAS APPLICABLE OR NOT. THE LD. CIT(A) HAS STATED THAT FROM THE DETAILS FILED BY TH E ASSESSEE OF TRANSPORTATION CHARGES IT IS TRUE THAT ALL THE PAYMENTS ARE BELOW RS.20 000/- TO EACH TRUCK. HOWEVER DETAILS ARE REQUIRED; TO VERIFY WHETHER THE PAYMENTS PER TRUCK IS BELOW RS.2 0 000/- AND THE PAYMENTS IN AGGREGATE WITHIN ITA NO. 658/KOL/20 10 9 THE FINANCIAL YEAR DID NOT EXCEED RS.50 000/- TO AN INDIVIDUAL. LD. CIT(A) HAS STATED THAT THE DETAILS OF THE PERSONS/TRANSPORTERS WHO RECEIVED TH E PAYMENTS ARE AVAILABLE IN SELF MADE VOUCHERS PRODUCED BY THE ASSESSEE. AS A RESULT APPLICATION OF SECTION 194C COULD NOT BE RULED OUT. THAT THE ASSESSEE HAS NOT MAINTAINED PROPER EVIDENCES RE GARDING EXPENDITURE. THEREFORE LD. CIT(A) HAS CONFIRMED THE DISALLOWANCE MADE BY THE ASSESSIN G OFFICER U/S. 40(A)(IA) READ WITH SECTION 194C OF THE ACT. HENCE THE ASSESSEE IS IN FURTHER APPEAL BEFORE THE TRIBUNAL. 17. DURING THE COURSE OF HEARING LD. AUTHORISED RE PRESENTATIVE FOR THE ASSESSEE MADE HIS SUBMISSIONS IN REGARD TO APPLICABILITY OF SECTION 4 0(A)(IA) AND SECTION 194C OF THE ACT ON THE LINES AS MADE WHILE ARGUING GROUND NO.1 OF THE APPE AL. THE LD. AUTHORISED REPRESENTATIVE FOR THE ASSESSEE FURTHER REFERRED TO PAGES 19 TO 21 OF THE PAPER BOOK FILED ALONGWITH MEMO. OF APPEAL AND SUBMITTED THAT IN REGARD TO ABOVE PAYMENTS AGGR EGATING TO RS.11 58 302/- PROVISION OF DEDUCTING TDS U/S. 194C WAS NOT APPLICABLE AS EACH OF THE PAYMENT WAS LESS THAN RS.20 000/- THE LD. AUTHORISED REPRESENTATIVE FOR THE ASSESSEE FURTHER SUBMITTED THAT ASSESSEE HAS MADE REQUISITION OF TRUCKS ON DAILY BASIS FROM TRUCK OWN ERS AND MADE THE PAYMENTS. THE LD. AUTHORISED REPRESENTATIVE FOR THE ASSESSEE FURTHER SUBMITTED THAT PAYMENTS ARE REFLECTED IN THE REGISTER AND CASH BOOK. THE LD. AUTHORISED REPRESEN TATIVE FOR THE ASSESSEE FURTHER SUBMITTED THAT AUTHORITIES BELOW HAVE NOT DOUBTED THE GENUINENESS OF THE EXPENDITURE INCURRED BY THE ASSESSEE AND MADE DISALLOWANCE MERELY ON THE GROUND THAT PAY MENTS WERE MADE BY SELF MADE VOUCHERS AND THEREFORE APPLICABILITY OF SECTION 194C COULD NOT BE RULED OUT. HE SUBMITTED THAT THE DISALLOWANCE IS NOT JUSTIFIED. 18. ON THE OTHER HAND THE LD. DEPARTMENTAL REPRESE NTATIVE IN HIS SUBMISSION SUPPORTED THE ORDERS OF THE AUTHORITIES BELOW. HE SUBMITTED THAT THE ASSESSEE COULD NOT FURNISH DETAILS OF THE PERSONS/TRANSPORTERS TO WHOM PAYMENTS WERE MADE AS THE SAME COULD NOT BE REVEALED FROM THE SELF MADE VOUCHERS PRODUCED BY THE ASSESSEE. 19. WE HAVE CAREFULLY CONSIDERED THE ORDERS OF THE AUTHORITIES BELOW AND THE SUBMISSIONS OF THE LD. REPRESENTATIVES OF BOTH THE PARTIES. WE HAV E CAREFULLY PERUSED PAGES 19 TO 21 OF THE PAPER BOOK FILED ALONGWITH MEMO. OF APPEAL AND HAVE ALSO CONSIDERED REMAND REPORT OF THE ASSESSING OFFICER. ON PERUSAL OF THE DETAILS PLACED AT PAGES 19 TO 21 OF THE PAPER BOOK FILED WITH THE MEMO OF APPEAL WE OBSERVE THAT IT CONTAINS DET AILS OF PAYMENTS ALONGWITH PARTICULARS OF ITA NO. 658/KOL/20 10 10 TRUCK NUMBERS AND THE DATE ON WHICH THE PAYMENTS WE RE MADE. WE ALSO OBSERVE THAT IN THE SAID STATEMENT WHEREVER PAYMENTS WERE EXCEEDING RS.20 00 0/- THE DETAILS OF DEDUCTING TDS @ 1.020% IS GIVEN ALONGWITH TRUCK NUMBER. WE ALSO OBS ERVE THAT THE ASSESSING OFFICER IN HIS REMAND REPORT HAS STATED THAT THE SAID PAYMENTS AGG REGATING RS.11 58 302/- CLAIMED BY THE ASSESSEE UNDER THE HEAD TRANSPORTATION CHARGES ARE REFLECTED IN THE LEDGER AND CASH BOOK. HOWEVER IT IS STATED THAT THE SAID PAYMENTS ARE BA SED ON SELF MADE VOUCHERS. CONSIDERING THE ABOVE OBSERVATIONS WE ARE OF THE CONSIDERED VIEW T HAT THE DISALLOWANCE MADE U/S. 40(A)(IA) OF THE ACT COULD NOT BE MADE MERELY BECAUSE THERE IS A N APPREHENSION/SUSPICION THAT APPLICATION OF SECTION 194C COULD NOT BE RULED OUT. THE DEPARTMENT HAS NOT BROUGHT EVEN A SINGLE INSTANCE ON RECORD THAT OUT OF ABOVE AMOUNT AGGREGATING TO RS.1 1 58 302/- THERE WAS ANY CASE WHERE PAYMENT EXCEEDING RS.20 000/- WAS MADE AT A TIME AN D/OR THE TOTAL PAYMENTS MADE TO AN INDIVIDUAL TRUCK OWNER IN THE FINANCIAL YEAR WAS EX CEEDING RS.50 000/- BY THE ASSESSEE. IF THE ASSESSEE HAS NOT MAINTAINED PROPER EVIDENCES THE D ISALLOWANCE COULD BE MADE UNDER OTHER PROVISIONS OF THE ACT ON THE GROUND OF NON-GENUINEN ESS OR AS PER SECTION 40A(3) OF THE ACT IF APPLICABLE BUT NO DISALLOWANCE COULD BE MADE U/S. 40(A)(IA) OF THE ACT MERELY ON THE PRESUMPTION THAT APPLICATION OF SECTION 194C COULD NOT BE RULED OUT BECAUSE THE PAYMENTS WERE SUPPORTED BY SELF MADE VOUCHERS WITHOUT CONTAINING DETAILS OF TRANSPORTERS/TRUCK OWNERS. IN ORDER TO MAKE DISALLOWANCE U/S. 40(A)(IA) OF THE AC T THE DEPARTMENT HAS TO SPECIFICALLY BRING OUT A CASE THAT THE ASSESSEE WAS REQUIRED TO DEDUCT TDS ON THE PAYMENTS MADE AS PER PROVISIONS OF THE ACT WHICH ASSESSEE FAILED TO DO SO. IN VIEW OF THE ABOVE WE ARE OF THE CONSIDERED VIEW THAT IN THE FACTS AND CIRCUMSTANCES OF THE CASE THE DIS ALLOWANCE OF RS.11 58 302/- CLAIMED BY THE ASSESSEE UNDER THE HEAD TRANSPORTATION CHARGES IS N OT JUSTIFIED. HENCE WE DELETE THE SAME BY ALLOWING GROUND NO.2 (REVISED GROUND) BY REVERSING THE ORDERS OF THE AUTHORITIES BELOW. 20. GROUND NO. 3 OF THE APPEAL IS CONNECTED WITH GR OUND NOS. 1 & 2 OF THE APPEAL AND DOES NOT REQUIRE ANY SPECIFIC ADJUDICATION. 21. IN RESPECT OF GROUND NO.4 OF THE APPEAL DISPUTI NG THE DISALLOWANCE OF LOADING AND UNLOADING CHARGES OF RS.2 41 580/- THE RELEVANT FA CTS ARE THAT THE ASSESSING OFFICER DISALLOWED RS.4 03 731/- ON THE GROUND THAT THE ASSESSEE COULD NOT FURNISH DETAILS/DOCUMENTARY EVIDENCE IN SUPPORT OF ITS EXPLANATION THAT PROVISIONS OF SECTI ON 194C OF THE ACT WAS NOT APPLICABLE. ITA NO. 658/KOL/20 10 11 HOWEVER IN THE FIRST APPEAL THE ASSESSEE STATED T HAT A SUM OF RS.1 62 151/- WAS TRANSPORTATION CHARGES WHICH WAS INCLUDED IN THE TOTAL LOADING AND UNLOADING CHARGES AGGREGATING RS.4 03 731/- THE LD. CIT(A) HAS STATED THAT AS PER LEDGER ACCOUN T THE SAID SUM OF RS.1 62 151/- IS TOWARDS LOADING CHARGES ONLY. THE LD. CIT(A) HAS FURTHER ST ATED THAT TAKING INTO CONSIDERATION THE FACTS THE SAID AMOUNT OF RS.1 62 151/- IS TO BE ALLOWED A S DEDUCTION. IN RESPECT OF BALANCE AMOUNT OF RS.2 41 580/- THE LD. CIT(A) HAS STATED THAT THE AS SESSEE COULD NOT FURNISH THE DETAILS OF THE PERSONS TO WHOM THE SAID AMOUNT WAS PAID. THE LD. C IT(A) HAS STATED THAT ASSESSEE WAS NOT ABLE TO EXPLAIN THE PAYMENTS MADE TO TRUCKS FOR UNLOADIN G CHARGES. THAT THE OWNERS OF THE TRUCKS ARE NOT KNOWN TO DECIDE THE TAX DEDUCTION AT SOURCE. IN VIEW OF ABOVE THE LD. CIT(A) HAS CONFIRMED DISALLOWANCE MADE BY THE ASSESSING OFFICER OF RS.2 41 580/-. HENCE THE ASSESSEE IS IN FURTHER APPEAL BEFORE THE TRIBUNAL. 22. THE ASSESSEE HAS FILED STATEMENT GIVING DETAILS OF THE AGGREGATE AMOUNT OF RS.2 41 580/- CLAIMED UNDER THE HEAD UNLOADING CHARGES. THE ASSES SEE HAS ALSO FILED NAME OF THE PAYEES ALONGWITH PARTICULARS OF TRUCK NUMBERS AND DATES AN D LOADING CHARGES PAID TO EACH PAYEES. THE ASSESSEE HAS SEPARATELY FILED LIST OF CLUBBING TOTA L AMOUNT PAID TO EACH PAYEE(S). DURING THE COURSE OF HEARING LD. AUTHORISED REPRESENTATIVE FO R THE ASSESSEE SUBMITTED THAT ON PERUSAL OF THE SAID STATEMENT IT COULD BE REVEALED THAT NO PA YMENT WAS EXCEEDING RS.20 000/- AT A TIME. FURTHER NO PAYMENT TO AN INDIVIDUAL PAYEE ALSO EXC EEDED RS.50 000/- IN THE FINANCIAL YEAR. THEREFORE NO TDS WAS REQUIRED TO BE DEDUCTED. THE LD. AUTHORISED REPRESENTATIVE FOR THE ASSESSEE ALSO REFERRED TO REMAND REPORT AND STATED THAT ASSESSING OFFICER HAS ALSO STATED THAT PAYMENTS ARE REFLECTED INTO THE LEDGER AND CASH BOO K BUT DISALLOWANCE HAS BEEN MADE BY APPLYING SECTION 40(A)(IA) OF THE ACT BECAUSE THE E XPENSES ARE MADE ON SELF MADE VOUCHERS. HE SUBMITTED THAT THE DISALLOWANCE MADE IS NOT JUSTIFI ED. 23. ON THE OTHER HAND THE LD. DEPARTMENTAL REPRESE NTATIVE IN HIS SUBMISSIONS SUPPORTED THE ORDERS OF THE AUTHORITIES BELOW AND SUBMITTED THAT ASSESSEE COULD NOT FILE SAID DETAILS BEFORE THE ASSESSING OFFICER AND THE LD. CIT(A). 24. WE HAVE CAREFULLY CONSIDERED THE SUBMISSIONS OF THE LD. REPRESENTATIVES OF BOTH THE PARTIES AND HAVE PERUSED THE ORDERS OF THE AUTHORIT IES BELOW. WE HAVE ALSO CONSIDERED PAGES 22 TO 24 OF THE PAPER BOOK FILED ALONGWITH MEMO OF APP EAL. IT IS RELEVANT TO STATE THAT ASSESSEE HAS ITA NO. 658/KOL/20 10 12 ALSO FILED AS PER DIRECTION OF THE BENCH THE STAT EMENTS CONTAINING NAMES OF THE PAYEES TO WHOM PAYMENTS WERE MADE AS UNLOADING CHARGES. ON PERUSAL OF SAID STATEMENT WE OBSERVE THAT EACH OF THE PAYMENT WAS VARYING BETWEEN RS.700/- TO RS.10 6 05/- AND AGGREGATING TO RS.2 41 580/-. WE ALSO OBSERVE FROM THE STATEMENT GIVING PAYEE-WISE D ETAILS OF UNLOADING CHARGES THAT MAXIMUM AMOUNT PAID IN THE FINANCIAL YEAR UNDER CONSIDERATI ON WAS TO TRIPURA RAJYA DIN MAZDOOR UNION (CITU) OF RS.22 158/- ON VARIOUS DATES. THEREFORE IT IS EVIDENT THAT NONE OF THE PAYMENT AT A TIME IS EXCEEDING RS.20 000/- AND THE AGGREGATE AMO UNT PAID TO A PERSON IN THE FINANCIAL YEAR DID NOT EXCEED RS.50 000/-. WE ALSO OBSERVE THAT THAT T HE DEPARTMENT HAS ALSO STATED THAT THE SAID PAYMENTS ARE REFLECTED IN LEDGER AND CASH BOOK OF T HE ASSESSEE. DISALLOWANCE HAS BEEN MADE ON THE GROUND THAT PAYMENTS ARE MADE ON SELF MADE VOUC HERS. NO FACTS HAVE BEEN BROUGHT ON RECORDED BY THE DEPARTMENT THAT THE SAID PAYMENTS A RE COVERED BY PROVISIONS OF SECTION 194C OF THE ACT ON WHICH TDS WAS REQUIRED TO BE DEDUCTED. W E ARE OF THE CONSIDERED VIEW THAT IF THE DEPARTMENT IS DOUBTFUL ABOUT GENUINENESS OF THE PAY MENTS CLAIMED BY THE ASSESSEE THE DISALLOWANCE COULD BE MADE UNDER OTHER PROVISIONS O F THE ACT BUT DISALLOWANCE U/S. 40(A)(IA) OF THE ACT COULD NOT BE MADE WHEN PRIMA FACIE ASSESSEE WAS NOT REQUIRED TO DEDUCT TDS THEREON. WE ARE OF THE CONSIDERED VIEW THAT MERELY ON ASSUMP TION AND SURMISES NO DISALLOWANCE COULD BE MADE U/S. 40(A)(IA) OF THE ACT. HENCE WE REVERS E THE ORDERS OF THE AUTHORITIES BELOW AND ALLOW GROUND NO.4 OF THE APPEAL TAKEN BY THE ASSESSEE BY DELETING DISALLOWANCE OF RS.2 41 580/- CLAIMED UNDER THE HEAD LOADING AND UNLOADING CHARGE S. 25. IN RESPECT OF GROUND NOS. 5 & 6 OF THE APPEAL T O DISALLOW RS.21 42 270/- CLAIMED AS TRANSPORTATION CHARGES PAID TO DIFFERENT PARTIES W E OBSERVE THAT THE ASSESSING OFFICER DISALLOWED THE SAME ON THE GROUND THAT ASSESSEE FAILED TO FURN ISH NAMES AND ADDRESSES OF THE PARTIES TO SUBSTANTIATE ITS CLAIM. HOWEVER IN FIRST APPEAL T HE LD. CIT(A) HAS STATED THAT ALL THE PAYMENTS ACCRUED IN THE MONTH OF OCTOBER 2005 IN THE BOOKS OF THE ASSESSEE AND THE ACTUAL PAYMENTS ARE MADE IN TWO PARTS. THAT ACCORDING TO INFORMATION F URNISHED BY THE ASSESSEE TDS WAS DEDUCTED ON TRANSPORTATION CHARGES OF RS.21 42 270/- IN THE MONTH OF OCTOBER 2005 AND DEPOSITED INTO GOVERNMENT ACCOUNT ON 31.05.2006 ALTOGETHER. LD. CI T(A) HAS STATED THAT ASSESSEE SHOULD HAVE REMITTED TDS AMOUNT TO GOVERNMENT ACCOUNT BY 31.03. 2006 AS PER PROVISIONS OF SECTION 40- (A)(IA) OF THE ACT TO CLAIM EXPENSES IN ASSESSMENT YEAR 2006-07. SINCE ASSESSEE DEPOSITED TDS AMOUNT INTO GOVERNMENT ACCOUNT ON 31.05.2006 THE E XPENDITURE IS ALLOWABLE AS PER PROVISIONS ITA NO. 658/KOL/20 10 13 OF SECTION 40(A)(IA) OF THE ACT IN ASSESSMENT YEAR 2007-08. THEREFORE LD. CIT(A) HAS CONFIRMED THE DISALLOWANCE ON THE GROUND THAT ASSESSEE HAD VI OLATED PROVISIONS OF SECTION 40(A)(IA) OF THE ACT AS THE ASSESSEE REMITTED TDS AMOUNT ON 31.05.20 06 WHEN THE PAYMENT WAS MADE IN THE MONTH OF OCTOBER 2005 ON DIFFERENT DATES FROM 23.1 0.2005 TO 29.10.2005. HENCE THE ASSESSEE IS IN FURTHER APPEAL BEFORE THE TRIBUNAL. 26. THE LD. AUTHORISED REPRESENTATIVE FOR THE ASSES SEE REFERRED TO COPY OF REMAND REPORT AND SUBMITTED THAT THE ASSESSING OFFICER HAS STATED THA T TDS ON TRANSPORTATION CHARGES OF RS.21 42 279/- WERE DEDUCTED IN THE MONTH OF OCTOBE R 2005. SINCE THE SAID TDS WAS REQUIRED TO BE DEPOSITED BY 31.03.2006 TO GET CLAIM OF EXPENSES IN THE PREVIOUS YEAR RELEVANT TO ASSESSMENT YEAR 2006-07 AS PER PROVISIONS OF SECTION 40(A)(IA) OF THE ACT THE ASSESSEE DEPOSITED THE SAME INTO GOVERNMENT ACCOUNT ON 31.05.2006. HENCE THE A SSESSEE HAS VIOLATED THE PROVISIONS OF SECTION 40(A)(IA) OF THE ACT AND CLAIM HAS BEEN DIS ALLOWED. THE LD. AUTHORISED REPRESENTATIVE FOR THE ASSESSEE RELYING ON THE DECISION OF I.T.A.T . MUMBAI BENCH IN ITA NO.5145/MUM/2009 (ASSESSMENT YEAR 2005-06) OF GOLDEN STABLES LIFESTY LE CENTER PVT. LTD. VS. CIT DATED 30.09.2010 (COPY PLACED ON RECORD) SUBMITTED THAT AS PER SUBSTITUTED PROVISIONS BY FINANCE ACT 2010 IF THE TAX IS DEPOSITED BEFORE DUE DATE OF FI LING OF RETURN AS SPECIFIED U/S. 139(1) OF THE ACT NO DISALLOWANCE COULD BE MADE U/S. 40(A)(IA) OF THE ACT. THE LD. AUTHORISED REPRESENTATIVE FOR THE ASSESSEE SUBMITTED THAT THAT I.T.A.T. MUMBAI B ENCH (SUPRA) IN THE ABOVE CASE HAS HELD THAT AMENDMENT BROUGHT IN BY THE FINANCE ACT 2010 HAS R EPLACED EARLIER AMENDMENT AND IT IS RETROSPECTIVE. THAT IT EXTENDS THE TIME LIMIT FOR A LL TDS PAYABLE THROUGHOUT THE YEAR. THE LD. AUTHORISED REPRESENTATIVE FOR THE ASSESSEE SUBMITTE D THAT THE ISSUE IS COVERED IN FAVOUR OF THE ASSESSEE AND NO DISALLOWANCE CAN BE MADE MERELY BEC AUSE THE ASSESSEE DEDUCTED TDS IN OCTOBER 2005 AND DEPOSITED ON 31.05.2006 AND WHERE AS DUE DATE OF FILING OF RETURN WAS OCTOBER 2006. 27. ON THE OTHER HAND THE LD. DEPARTMENTAL REPRESE NTATIVE SUBMITTED THAT THIS BENCH SHOULD NOT FOLLOW THE DECISION OF I.T.A.T. MUMBAI BENCH A S THE AMENDMENTS MADE BY FINANCE ACT 2010 IS NOT RETROSPECTIVE. IN REPLY TO A QUERY THE LD. DEPARTMENTAL REPRESENTATIVE COULD NOT PLACE ANY DECISION OF ANY BENCH OF I.T.A.T. CONTRAR Y TO DECISION OF I.T.A.T. MUMBAI BENCH (SUPRA). HOWEVER THE LD. DEPARTMENTAL REPRESENTATI VE SUBMITTED THAT NO AMENDMENT CAN BE ITA NO. 658/KOL/20 10 14 CONSIDERED RETROSPECTIVE UNLESS IT IS EXPRESSLY STA TED AND PLACED RELIANCE ON THE DECISION OF HONBLE SUPREME COURT IN THE CASE OF GEM GRANITES V S. CIT [2004] 271 ITR 322 (SC). 28. WE HAVE CAREFULLY CONSIDERED THE SUBMISSIONS OF THE LD. REPRESENTATIVES OF THE PARTIES AND THE ORDERS OF THE AUTHORITIES BELOW. WE OBSERVE THAT THE SAID AMOUNT OF RS.21 42 279/- HAS BEEN DISALLOWED U/S. 40(A)(IA) OF THE ACT ON THE GR OUND THAT SAID PAYMENT WAS MADE IN THE MONTH OF OCTOBER 2005 AND TDS WAS ALSO DEDUCTED BUT TDS AMOUNT WAS DEPOSITED IN GOVERNMENT ACCOUNT ON 31.05.2006; THEREFORE ASSESSEE COULD CL AIM DEDUCTION IN NEXT ASSESSMENT YEAR AND NOT IN ASSESSMENT YEAR UNDER CONSIDERATION. HOWEVER WE OBSERVE THAT SIMILAR ISSUE HAS BEEN CONSIDERED BY I.T.A.T. MUMBAI BENCH VIDE ITS ORDER DATED 30.09.2010 (SUPRA) WHEREIN IT HAS BEEN HELD THAT AMENDMENT MADE BY FINANCE ACT 2010 HAS REPLACED THE EARLIER AMENDMENTS. THAT THE AMENDMENT BY FINANCE ACT 2010 IS CURATIVE IN N ATURE AND WOULD APPLY TO EARLIER YEARS ALSO. THEREFORE THE EXPENDITURE INCURRED IN RESPECT OF W HICH TDS HAS BEEN PAID BY THE ASSESSEE BEFORE DUE DATE OF FILING OF RETURN ASSESSING OFFI CER NOT TO DISALLOW THE EXPENDITURE BY APPLYING PROVISIONS OF SECTION 40(A)(IA) OF THE ACT. 29. IN VIEW OF ABOVE AND RESPECTFULLY FOLLOWING TH E DECISION OF I.T.A.T. MUMBAI BENCH (SUPRA) WE DELETE THE SAID DISALLOWANCE OF RS.21 4 2 279/- BY REVERSING THE ORDERS OF THE AUTHORITIES BELOW. HENCE GROUND NO.5 & 6 OF THE AP PEAL ARE ALLOWED. 30. IN THE RESULT APPEAL OF THE ASSESSEE IS ALLOWE D IN PART. ORDER PRONOUNCED IN THE COURT ON 28. 01. 2011. SD/- SD/- [ C. D. RAO ] [ B. R. MITTAL ] ACCOUNTANT MEMBER JUDICIA L MEMBER DATED : 28TH JANUARY 2011. ITA NO. 658/KOL/20 10 15 COPY FORWARDED TO THE - 1. M/S. MATRIX GLASS & STRUCTURES PVT. LTD. 1 NETAJI SUBHAS ROAD 1 ST FLOOR KOLKATA-700 001. 2. INCOME TAX OFFICER WARD-6(2) P-7 CHOWRINGHEE SQU ARE AAYAKAR BHAWAN 6 TH FLOOR KOL. 3. CIT(A)- (4) CIT- 5. D.R. I.T.A.T. KOLKATA. [TRUE COPY] BY ORDER DEPUTY/ASSISTANT REGISTRAR (KKC) I.T.A.T. KOLKATA.