Delay in payment of TDS deducted,Sec40(i)(ia)

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This query is : Resolved

mahendra singh saluja (Querist)

19 January 2010 One of my client has deducted TDS on tranporting payments during financial year 2004-05 , but deposited the entire amount in May 2005. The assessing officer has added the full expenditure of transporting except for March 2005.
Is there any remedy for appeal with CIT Appeal.
Are there any case laws relating to above matter or pending with Supreme court.

Suitable case laws may be sent to me at my e-mail id.
Yes Mr.Barun Kumar Ghosh u can send my those two judgements at my e mail id i.e. mssaluja_ca@rediffmail.com

Aditya Maheshwari

Aditya Maheshwari (Expert)

19 January 2010 The act of the assessing officer is correct even as per the amended section 40(a)(ia). Even if you file appeal there would be no remedy to you.

Also the supreme court has held the said section as constitutional

Bhaskaran Chackrapani Warrier

Bhaskaran Chackrapani Warrier (Expert)

19 January 2010 Support Aditya Sir. U have a loosing case.

Bimal Thacker

Bimal Thacker (Expert)

19 January 2010 I am fully agree with the expert. However recently I have read in news letter about deceision of Jaipur Bench of ITAT in case of Jaipur Vidyut Vitran Nigam Ltd. V DCIT -123TTJ888- According to the decision, the disallowance applies only to expenditure which is unpaid. As a result substantial addition may get deleted if this decision is followed.

Barun Kumar Ghosh

Barun Kumar Ghosh (Expert)

20 January 2010 Were there any contract in existence between your client and the transporter?
The reason for asking you this question is that recently in two unreported cases the Kolkata Bench of Income-tax Appellate Tribunal has held that unless the Revenue department brings on record the existence of any contract with the transporter, the provision of section 194C does not apply. In that case the question of disallowance under section 40(a)(ia) does not arise. In such case, even if the tax deducted at source has not been deposied in time, I believe that the assessee can take shelter under those two orders of Kolkata bench of ITAT.
If you are interested in those two unreported judgements, you may write yur e-mail id.