Income Tax Appellate Tribunal - Kolkata
D.C.I.T Cir - 2,Kolkata, Kolkata vs Lmj Logistics Ltd, Kolkata on 18 January, 2017
IN THE INCOME TAX APPELLATE TRIBUNAL
Kolkata Bench, KOLKATA
(Bench- "A")
BEFORE SRI ABY T.VARKEY, JUDICIAL MEMBER AND
SHRI WASEEM AHMED, ACCOUNTANT MEMBER
I.T.A No. 872/Kol/2013
Assessment Year: 2009-10
D.C.I.T., Cir-2, Kolkata
[PAN : AABCP8494K]
-Vs-
M/s LMJ Logistics
15B, Hemanta Basu Sarani,
5th Floor, Kol-700001.
(Appellant)
(Respondent)
For the Appellant
None (DR)
For the Respondent
Arti Debnath (C.A.)
Date of Hearing
27.12.2017
Date of Pronouncement
.01.2017
ORDER
Per Aby T.Varkey, JM
This is an appeal preferred by the Revenue against the order of the CIT(A)-I, Kolkata dt. 30.01.2013, for the assessment year 2009-10. The main grievance of the Revenue is against the deletion of the disallowance u/s 40(a) (ia) to the extent of Rs. 29,68,044/-.
2. The AO in the grounds of appeal itself admits that the TDS have been deposited in the Central Government account after the stipulated time. However, the amendment made by the Finance Bill, 2010, according to the AO is applicable to Assessment Year 2010-11 and subsequent years only and not retrospective. This is the main grievance of the Revenue.
3. Brief facts of the case is that during the year under consideration the assessee has incurred an expenditure of Rs. 29,68,044/- on account of Security Charges of Rs. 1,11,834/-, Professional fees of Rs. 4,00,000/-, Labour Charges of Rs. 24,16,210/- and rent of Rs. 40,000/-, thus making a total expenditure of Rs. Rs. 29,68,044/-. The AO disallowed the above expenditure u/s 40(a)(ia) by stating that the TDS deducted on these expenditure was not deposited within the due date. The assessee's submission that the TDS on all the above mentioned payments were deposited before the stipulated date i.e. before the filing of Return of Income u/s 139(1) which is before 30th September, 2009 was not accepted by the AO and, therefore, he made the disallowance. Ld. CIT(A) has allowed the appeal of the assessee by holding as under :
"Next ground of appeal relates to disallowance u/s 40(a)(ia) to the extent of Rs. 29,68,044/- as TDS was deposited in the Cen. Govt. A/c beyond the due date. It was contended by the assessee that all TDS on the payments mentioned by the AO were deposited in the Cen.Govt. account before the due date of furnishing of return of income u/s 139(1) i.e. before 30.09.2009 and furnished the details regarding the payment along with challans in the paper book from and further, relied upon the decision of Kolkata High Court in the case of CIT Vs Virgin Creation dt. 23.11.2011. The AO is directed to allow the claim of the assessee subject to verification of the claim of the assessee regarding all the payments being made before the due date of filing the return. Ground No. 2 is allowed."
Aggrieved the Revenue is before us.
4. We have heard both the parties and perused the records. We take note that the assessee had deposited the TDS with the Central Government account before 30.09.2009 and furnished the details regarding the payment along with challans before the Ld. CIT(A). The Ld. CIT(A) relying on the order of the jurisdictional High Court in the case of CIT Vs. Virgin Creations dt. 23.11.2011 directed the AO to allow the claim of the assessee subject to verification of the claim of the assessee that all the payments were made before the due date of the filing of the return. The said impugned action of the Ld. CIT(A) suffers no legal infirmity. The Ld. CIT(A) has directed the AO to allow the claim of expenses provided it is able to prove that it has deducted the tax and remitted the same before 30th September, 2009 and for giving the said direction has relied upon the order of the Hon'ble Calcutta High Court in CIT Vs. Virgin Creations dt. 23.11.2011. The Ld. DR could not point out any infirmity in the order passed by the Ld. CIT(A). The Hon'ble Calcutta High Court has taken note that the Hon'ble Supreme Court in the case of Allied Motors Pvt. Ltd and also in the case of Alom Extrusions Ltd., has decided that the proviso inserted by the Finance Act, 2010 u/s 40(a)(ia) is retrospective in nature. The Hon'ble High Court has re-iterated that the provision which has been inserted to make the provision workable requires to be treated with a retrospective operation, so that reasonable deduction can be given to the section as well. Therefore, we completely agree with the order of the Ld. CIT(A) and so we dismiss the appeal preferred by the Revenue.
7. In the result the appeal of the Revenue stands dismissed.
Order pronounced in the Court on .01.2017.
[Shri Wassem Ahmed] [A.T.Varkey]
Accountant Member Judicial Member
Dated : .01.2017
{SC SPS}
Copy of the order forwarded to:
1. DCIT, Cir-2, Kolkata.
2. M/s LMJ Logistics, 15B, Hemanta Basu Sarani, 5th Floor, Kol-700001.
3. CIT(A)- Kolkata.
4. CIT - , Kolkata.
5. CIT(DR), Kolkata Benches, Kolkata.
True copy
By Order
Asstt.Registrar, ITAT, Kolkata Benches
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ITA No.872/Kol/2013
M/s LMJ Logistics
A.Yr.2009-10
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