HC : Reverses ITAT; Contracts receipts, not JV-company's income, but diversion by overriding title

Jammu and Kashmir HC reverses ITAT order and rules in favour of assessee (a JV company) for AY 2005-06, railway contract receipts of over Rs. 12 cr. not income of assessee, but diversion of income by overriding title;  Assessee (a joint venture between two companies) was formed for construction of railway tunnels, HC notes that assessee was formed only for the purposes of submission of tender and that the contract was not executed by assessee, but by JV members, and contract was merely allotted in assessee’s  name;  Further, noting that the contract receipts of over Rs. 12 cr. were allocated to the JV partners  (in the ratio of 97:3), HC holds no income accrued to assessee as there was diversion of income by overriding title, extensively relies on SC ruling in Sitaldas Tirathdas;  Remarks that “neither amount would have been received by the assessee from the northern railways for no work performed by it nor it could be stated that the assessee has performed any activity but still the income has accrued.”; Separately, HC rules that the amount allocated / distributed to JV partners could not be disallowed u/s. 40(a)(ia), holds Finance Act, 2012 amendment inserting proviso to Sec. 40(a)(ia) [stating that once tax is paid by payee, deductor cannot be treated as assessee-in-default] is retrospective in nature, also cites CBDT circular on allocation of revenues in consortium arrangements:HC