Principal Commissioner Of Income Tax-4, Kolkata vs Amri Hospital Ltd.

The present appeal arises out of the order of the Assessing Officer directing addition of certain sums paid by the assessee for the assessment year

2009-10 to its different constituents which under the normal circumstances would have been deductible as expenses only.

The Assessee, however, was required to deduct tax at source and make deposit thereof, which the assessee did not do within the relevant previous

year. The assessee however had made the deposits before furnishing of return. The Assessing Officer had directed adding back the said deduction

claims to the income of the assessee.

It is not in dispute that the deduction which was claimed by the assessee would have had otherwise come within the purview to Section 40(a)(ia) of

the Income Tax Act, 1961. Thus we do not consider it necessary to specify the item heads in respect of which such deduction was claimed by the

assessee. The Commissioner of Income Tax (Appeals), as the first appellate authority allowed the assessee’s appeal holding that the amendment

made to Section 40(a)(ia) by the Finances Act, 2010 would be retrospective in effect and would cover the assessee’s claims for deduction for the

assessment year 2009-10.

It is also not in dispute that the TDS payment was made within the time specified under Section 139(1) of the Act, that is before the due date for filing

return specified in Section 139(1). The Tribunal concurred with the decision of the first appellate authority in the appeal filed by the Revenue. The

Hon’ble Supreme Court of India in the case of Commissioner of Income Tax, Kolkata Vs. M/s. Calcutta Export Company reported in (2018) 93

Taxmann.com at page 51 has held:-

“30. Hence, in light of the forgoing discussion and the binding effect of the judgement given in Allied Moters (supra), we are of the view that the

amended provision of Sec 40(a)(ia) of the IT Act should be interpreted liberally and equitable and applies retrospectively from the date when Section

40(a)(ia) was inserted i.e., with effect from the Assessment Year 2005-2006 so that an assessee should not suffer unintended and deleterious

consequences beyond what the object and purpose of the provision mandates. As the developments with regard to the Section recorded above shows

that the amendment was curative in nature, it should be given retrospectiveoperation as if the amended provision existed even at the time of its

insertion….. â€​

The retrospective application of the aforesaid amended provision is the only point on which the Revenue has pressed this appeal and Revenue's

contention is that the aforesaid provision would be operable from the Assessment Year 2010-11. The judgement of the Hon’ble Supreme Court of

India referred to in the preceding paragraph negates this stand. No other point has been pressed before us by the learned Counsel appearing for the

Revenue.

In this perspective, we do not find any substantial question of law to be involved in this appeal. The question of law urged is covered by the aforesaid

judgment of the Hon’ble Supreme Court of India. We accordingly dismiss both the appeal and the stay petition and confirm the decision of the

Tribunal on the point discussed in this judgment. There shall be no order as to costs.