Home Income tax Individual Income Tax 2nd Proviso to Part 40(a)(ia) of Earnings Tax has retrospective impact: ITAT

2nd Proviso to Part 40(a)(ia) of Earnings Tax has retrospective impact: ITAT

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2nd Proviso to Part 40(a)(ia) of Earnings Tax has retrospective impact: ITAT

2nd Proviso to Part 40(a)(ia) of Earnings Tax has retrospective impact: ITAT

The Earnings Tax Appellate Tribunal (ITAT) within the matter of Assistant Commissioner of Earnings Tax (ACIT) v/s M/s. Constructive Print Signal Graphics has retreated the judgment handed by the Hon’ble Delhi Excessive Court docket within the case of Dr. Jaydeep Sharma 52 taxman.com 420 (Delhi) that 2nd Proviso to Part 40(a)(ia) of the Act is having retrospective impact from 01.04.2005.

The case of the assessee is that this that the 2nd Proviso to Part 40(a)(ia) of the Act r.w. Proviso to Part 201(1) of the Act prescribes no disallowance of bills beneath Part 40(a)(ia) of the Act could be made until the assessee has been handled as assessee in default beneath Part 201(1) of the Act for its failure to deduct tax at supply from the cost made on account of curiosity.

It was additional the case of the assessee is that this that within the occasion if the quantity paid by payer have been included by the payee in its return of earnings for the related evaluation 12 months, filed beneath Part 139 of the Act and has paid the tax due on the earnings declared in such return, to the extent recipient from such assessee is included the sum in his return of earnings and filed the identical, no disallowance beneath Part 40(a)(ia) of the Act could be made by the Ld. AO in view of the 2nd Proviso to Part 40(a)(ia) r.w.s. First Proviso to Part 201(1) of the Act.

Aside from that it was contended by the assessee that the 2nd Proviso to Part 40(a)(ia) of the Act inserted by Finance Act, 2012 and on furnishing of certificates in Type 26A as prescribed beneath Proviso to Part 201(1) r.w. Rule 31ACB of IT Guidelines, no disallowance beneath Part 40(a)(ia) of the Act could be made. The truth is, the 2nd Proviso to Part 40(a)(ia) of the Act has been inserted within the statute by the Finance Act, 2012 w.e.f. 01.04.2013 having retrospective impact from 01.04.2005.

Preserving in view of this specific facet of the matter, the Ld. CIT(A) handed the order in favor of the Assessee whereas deleting the addition made by the Ld. Assessing Officer. The identical was now affirmed by Tribunal and because of this, Income’s enchantment was dismissed.

For Official Judgment Obtain PDF Given Under:

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