The ITAT Ahmedabad ruled that the Supreme Court's disallowance of LTC exemption involving foreign travel does not apply retroactively to create TDS default liability for prior periods covered by judicial protection.
SC LTC Ruling Cannot Retrospectively Create TDS Default: ITAT Ahmedabad
The ITAT Ahmedabad has ruled that the Supreme Court's recent judgment concerning the disallowance of Leave Travel Concession (LTC) exemptions for foreign travel does not retrospectively impose liability for tax deduction at source (TDS) defaults. This ruling specifically pertains to periods during which the assessee had judicial protection.
The Tribunal clarified that existing judicial protections should shield the taxpayer from any retrospective enforcement of TDS liabilities, thereby upholding the principles of fairness and due process within taxation legislation.
This important decision reinforces the protection available to taxpayers during periods of uncertainty and emphasizes that legislative or judicial changes should not be applied retroactively without just cause.
Citations
- ITAT Ahmedabad (2026) ITAT 92
