ITO, Wd 3(2), Pune, Pune v. Shri Hatkeshwara Cargo Movers, Pune

ITA 89/PUN/2009 | 2005-2006
Pronouncement Date: 31-01-2011 | Result: Dismissed

Appeal Details

RSA Number 8924514 RSA 2009
Assessee PAN AATFS8504N
Bench Pune
Appeal Number ITA 89/PUN/2009
Duration Of Justice 2 year(s) 8 day(s)
Appellant ITO, Wd 3(2), Pune, Pune
Respondent Shri Hatkeshwara Cargo Movers, Pune
Appeal Type Income Tax Appeal
Pronouncement Date 31-01-2011
Appeal Filed By Department
Order Result Dismissed
Bench Allotted B
Tribunal Order Date 31-01-2011
Assessment Year 2005-2006
Appeal Filed On 22-01-2009
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH B PUNE BEFORE SHRI I C SUDHIR JUDICIAL MEMBER AND SHRI G.S. PANNU ACCOUNTANT MEMBER ITA NO. 89/PN/09 (ASSTT YEAR: 2005-06) INCOME-TAX OFFICER WARD 3(2) PUNE APPELLANT VS. SHRI HATKESHWARA CARGO MOVERS C/O MRS SUJATA SHAH 1076 SADASHIV PETH PUNE RESPONDENT PAN AATFS8504N APPELLANT BY : SHRI S. K. LEUVA RESPONDENT BY : SHRI C H NANIWADEKAR ORDER PER G.S. PANNU A.M: THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME-TAX (APPEALS)-II PUNE D ATED 1.10.2008 WHICH IN TURN HAS ARISEN FROM AN ORDER DATED 6.12.2007 PASSED BY THE ASSESSING OFFICER UNDER SEC . 143(3) OF THE INCOME-TAX ACT 1961 (IN SHORT THE ACT) PERTA INING TO THE ASSESSMENT YEAR 2005-06. 2. THE PERTINENT DISPUTE IN THE CAPTIONED APPEAL RE LATES TO THE ACTION OF THE COMMISSIONER OF INCOME-TAX (APPEALS) IN SETTING ASIDE A DISALLOWANCE OF RS 1 70 27 619/- MADE BY TH E ASSESSING OFFICER BY INVOKING THE PROVISIONS OF SECTION 40(A) (IA) OF THE ACT. 3. IN BRIEF THE FACTS ARE THAT ASSESSEE IS A TRANSP ORT OPERATOR/CONTRACTOR WHO FILED ITS RETURN OF INCOME ON 31.10.2005 ITA NO 89/PN/09 SHRI HATKESHWARA CARGO MOVERS PUNE 2 DECLARING TOTAL INCOME OF RS 92 840/-. IN THE COURS E OF ASSESSMENT PROCEEDINGS THE ASSESSING OFFICER NOTED THAT ASSESSEE HAD DEDUCTED TAX AT SOURCE (TDS) ON PAYMEN TS MADE TO TRANSPORT CONTRACTORS AND PROFESSIONAL FEES AND THAT SUCH TDS HAS BEEN REMITTED BELATEDLY TO THE CREDIT OF THE GO VERNMENT. FOR THE AFORESAID REASON HE DISALLOWED SUCH PAYMENTS O F RS 2 74 17 877/- AND RS 1 03 100/- TOWARDS TRANSPORT C ONTRACTOR AND PROFESSIONAL FEES RESPECTIVELY BEING IN VIOLATION O F PROVISIONS OF SECTION 40(A)(IA) OF THE ACT. IN APPEAL THE COMMIS SIONER OF INCOME-TAX (APPEALS) DELETED THE ENTIRE ADDITION OF RS 1 03 100/- OUT OF PROFESSIONAL FEES. OUT OF THE TRANSPORT CONT RACTORS PARTIAL RELIEF HAS BEEN ALLOWED BY THE COMMISSIONER OF INCO ME-TAX (APPEALS) AS FOLLOWS: (A) ON PAYMENTS OF RS 7 740/- AND RS 21 150/- TO MEENA ROADLINES AND ORIENTAL BULK CARRIER RESPECTIVELY IT WAS FOUN D THAT THE SAME BEING BELOW THE PRESCRIBED AMOUNT NO TDS WAS REQUIRED TO BE DEDUCTED AND HENCE SECTION 40(A)(IA) WAS INAPPLICABLE ON SUCH A MOUNTS; (B) IT WAS NOTICED THAT AN ADDITION OF RS 2 74 7 0 877/- WAS MADE ON ACCOUNT OF BELATED PAYMENT OF TDS WHEREAS THE TOTA L EXPENDITURE DEBITED TO THE PROFIT AND LOSS ACCOUNT ON THIS COUNT WAS ON LY RS 2 71 54 629/-. HENCE THE DIFFERENTIAL WAS DELETED; AND (C) IT WAS NOTICED THAT TDS OF RS 182 954/- DED UCTED IN THE MONTH OF MARCH FOR PAYMENT OF TRANSPORTATION EXPENDITURE OF RS 1 70 27 619/- WAS DEPOSITED TO THE GOVERNMENT TREASURY BEFORE THE TIM E ALLOWED UNDER SECTION 139 OF THE ACT AND THEREFORE THE AMOUNT O F RS 1 70 27 619/- WAS NOT DISALLOWABLE UNDER SECTION 40(A)(IA) OF THE ACT . ITA NO 89/PN/09 SHRI HATKESHWARA CARGO MOVERS PUNE 3 4. IN THIS MANNER THE COMMISSIONER OF INCOME-TAX ( APPEALS) ALLOWED PARTIAL RELIEF AS PER ITEM (C) ABOVE WHICH IS THE SUBJECT MATTER OF DISPUTE BY THE REVENUE BEFORE US. NOTABLY THE IMPUGNED REL IEF HAS BEEN ALLOWED BY THE COMMISSIONER OF INCOME-TAX (APPEALS) ON THE GROUND THAT AS PER THE FINANCE ACT 2008 PROVISIONS OF SECTION 40(A)( IA) WERE AMENDED RETROSPECTIVELY FROM 1.6.2005 TO PROVIDE THAT WHERE TDS IS DEDUCTED ON THE LAST MONTH OF THE PERIOD AND THE SAME IS DEPOSI TED BEFORE THE END OF THE TIME ALLOWED FOR FILING OF THE RETURN UNDER SEC TION 139(1) OF THE ACT SUCH EXPENDITURE COULD NOT BE DISALLOWED UNDER SECT ION 40(A)(IA) OF THE ACT. AGAINST THE AFORESAID REVENUE IS IN APPEAL BE FORE US. 5. IT WAS A COMMON GROUND BETWEEN THE PARTIES THAT THE AFORESAID PROPOSITION IS IN LINE WITH THE FOLLOWING DECISIONS OF THE TRIBUNAL: 1 M/S SUPER HARYANA ROADWAYS NASHIK ITA NO 193/PN /09 VIDE ORDER DATED 7.1.2011 2 BAPUSAHEB NANASAHEB DHUMAL MUMBAI ITA NO 6628/MUM/09 VIDE ORDER DATED 25.6.2010 3 BANSAL PARIVAHAN (I) P. LTD. MUMBAI ITA NO 2355/ MUM/10 VIDE ORDER DATED22.9.2010 IN THE CASE OF M/S BANSAL PARIVAHAN (I) P LTD. TH E TRIBUNAL HAS OBSERVED AS UNDER: THE PROVISIONS OF SECTION 40(A)(IA) AS STOOD PRIOR TO THE AMENDMENTS MADE BY THE FINANCE ACT 2010 THUS WERE RESULTING IN TO UNINTENDED CONSEQUENCES AND CAUSING GRAVE AND GENUINE HARDSHIP S TO THE ASSESSEES WHO HAD SUBSTANTIALLY COMPLIED WITH THE R ELEVANT TDS PROVISIONS BY DEDUCTING THE TAX AT SOURCE AND BY PA YING THE SAME TO THE CREDIT OF THE GOVERNMENT BEFORE THE DUE DATE OF FILING OF THEIR RETURNS U/S 139(1). IN ORDER TO REMEDY THIS POSITIO N AND TO REMOVE THE HARDSHIPS WHICH WAS BEING CAUSED TO THE ASSESSEES B ELONGING TO SUCH CATEGORY AMENDMENTS HAVE BEEN MADE IN THE PRO VISIONS OF SECTION 40(A)(IA) BY THE FINANCE ACT 2010. THE SAID AMENDMENTS IN OUR OPINION THUS ARE CLEARLY REMEDIAL/CURATIVE IN NATURE AS HELD BY THE HONBLE SUPREME COURT IN THE CASE OF ALLIED MOT ORS PVT. LTD. (SUPRA) AND ALOM EXTRUSIONS LTD (SUPRA) AND THE SAM E THEREFORE WOULD APPLY RETROSPECTIVELY W.E.F. 1 ST APRIL 2005. IN THE CASE OF R.B. JODHA MAL KUTHIALA 82 ITR 570 IT WAS HELD BY THE H ONBLE SUPREME COURT THAT A PROVISO WHICH IS INSERTED TO REMEDY UN INTENDED CONSEQUENCES AND TO MAKE THE PROVISION WORKABLE RE QUIRES TO BE TREATED AS RETROSPECTIVE IN OPERATION SO THAT A REA SONABLE INTERPRETATION CAN BE GIVEN TO THE SECTION AS A WHO LE. IN THE PRESENT ITA NO 89/PN/09 SHRI HATKESHWARA CARGO MOVERS PUNE 4 CASE THE AMOUNT OF TAX DEDUCTED AT SOURCE FROM THE FREIGHT CHARGES DURING THE PERIOD 1.4.2005 TO 28.2.2006 WAS PAID BY THE ASSESSEE IN THE MONTHS OF JULY AND AUGUST 2006 I.E. WELL BEFORE THE DUE DATE OF FILING OF ITS RETURN OF INCOME FOR THE YEAR UNDER C ONSIDERATION. THIS BEING THE UNDISPUTED POSITION WE HOLD THAT THE DIS ALLOWANCE MADE BY THE A.O AND CONFIRMED BY THE LEARNED CIT(A) ON ACCO UNT OF FREIGHT CHARGES BY INVOKING THE PROVISIONS OF SECTION 40(A) (IA) IS NOT SUSTAINABLE AS PER THE AMENDMENTS MADE IN THE SAID PROVISIONS BY THE FINANCE ACT 2010 WHICH BEING REMEDIAL/CURATIV E IN NATURE HAVE RETROSPECTIVE APPLICATION. 6. FOLLOWING THE AFORESAID OBSERVATIONS WHICH SQUAR ELY APPLY TO THE PRESENT SITUATION WE FIND NO REASONS TO INTERFERE WITH THE CONCLUSION DRAWN BY THE COMMISSIONER OF INCOME-TAX (APPEALS). 7. IN THE RESULT THE APPEAL OF THE REVENUE IS DISM ISSED. PRONOUNCED IN THE OPEN COURT ON THIS 31ST DAY OF JANUARY 2011. SD/- SD/- (I C SUDHIR) (G.S. PANNU) JUDICIAL MEMBER ACCOUNTANT MEMBER PUNE DATED: 31ST JANUARY 2011 COPY TO:- 1) SHRI HATKESHWARA CARGO MOVERS PUNE 2) THE ITO WD 3(2) PUNE 3) THE CIT (A) II PUNE 4) THE CIT-II PUNE 5) THE D R B BENCH ITAT PUNE. BY ORDER TRUE COPY ASSTT. REGISTRAR I.T.A.T. PUNE B