Shanthi Fortune (India) Private Ltd., Palladam V. ITO, Coimbatore

CO 30/CHNY/2013

• Counselvise Citation: [2013] 122 COUNSELVISE.COM (IT) 8655 (ITAT-CHENNAI)
• Duration Of Justice: 5 month(s) 18 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 17-07-2013
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 04-07-2013
• Assessment Year: 2009-2010
• Appeal Filed On: 30-01-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: SHAJI P JACOBADDL
• Assessee Lawyers: S SRIDHAR
• Keywords: Corroborative evidences

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH : CHENNAI BEFORE SHRI ABRAHAM P. GEORGE, ACCOUNTANT MEMBER AND SHRI VIKAS AWASTHY, JUDICIAL MEMBER I.T.A. NO. 2260/MDS/2012 & C.O. NO. 30/MDS/2013 ( IN ITA NO. 2260/MDS/2012 ) ASSESSMENT YEAR 2009-10 INCOME TAX OFFICER, TDS WARD-I(3), 63, RACE COURSE ROAD, COIMBATORE. VS M/S. SHANTHI FORTUNE (INDIA) PRIVATE LIMITED, DOOR NO. 38, TRICHY ROAD, PALLADAM 641 664. [PAN: AAJCS 4289 D] (APPELLANT) (RESPONDENT/CROSS OBJECTOR) REVENUE BY : SHRI SHAJI P.JACOB,ADDL.CIT ASSESSEE BY : SHRI S. SRIDHAR, ADVOCATE DATE OF HEARING : 04-07-2013 DATE OF PRONOUNCEMENT : 17-07-2013 O R D E R PER VIKAS AWASTHY, JUDICIAL MEMBER THE APPEAL HAS BEEN FILED BY THE REVENUE AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX(APPEALS)-II , COIMBATORE DATED 28-08-2012 RELEVANT TO THE ASSESSM ENT YEAR I.T.A. NO. 2260/MDS/2012 & C.O. NO. 30/MDS/2013 :- 2 -: (AY) 2009-10. THE ASSESSEE HAS FILED CROSS OBJECT ION IN SUPPORT OF THE ORDER OF CIT(APPEALS). 2. THERE IS A DELAY OF 31 DAYS IN FILING OF THE APP EAL BY THE REVENUE. THE INCOME TAX OFFICER, TDS WARD-I(3), CO IMBATORE HAS FILED HIS AFFIDAVIT STATING REASONS FOR DELAY I N FILING OF THE APPEAL. WE HAVE PERUSED THE GROUNDS MENTIONED IN T HE AFFIDAVIT CAUSING DELAY IN FILING OF THE APPEAL. WE ARE SATI SFIED THAT THE DELAY IN FILING OF THE APPEAL IS UN-INTENTIONAL AND REASONS STATED IN THE AFFIDAVIT ARE ACCEPTED. THE AR OF THE ASSESSEE HAS NOT OBJECTED TO THE CONDONATION OF DELAY. IN THE INTER EST OF JUSTICE, THE DELAY OF 31 DAYS IN FILING OF THE APPEAL IS CONDONE D. THE APPEAL IS ADMITTED TO BE HEARD AND DISPOSED OF ON MERITS. 3. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSE E IS A COMPANY ENGAGED IN THE BUSINESS OF BRIOLER REARING, FEED MILLS AND HATCHERIES ETC., AN INSPECTION WAS CARRIED OUT IN THE PREMISES OF THE COMPANY ON 24-02-2010. DURING THE COURSE OF SEARCH IT WAS FOUND THAT THE ASSESSEE HAD DEDUCTED TAX AT SOURCE TO THE TUNE OF RS. 1,63,83,735/- U/S. 194A TO 194J OF THE INCOME TAX ACT, 1961 (HEREIN AFTER REFERRED TO AS THE ACT ) FOR THE PERIOD I.T.A. NO. 2260/MDS/2012 & C.O. NO. 30/MDS/2013 :- 3 -: RELATING TO THE AY. 2009-10. HOWEVER, FROM THE TAX DEDUCTED AT SOURCE (TDS), THE ASSESSEE REMITTED RS. 50,18,131/- ONLY IN THE GOVERNMENT TREASURY EVEN THOUGH THE TIME SPECIFIED FOR DEDUCTION AND REMITTANCE OF TAX UNDER THE ACT HAD L ONG ELAPSED. THE ASSESSEE VIDE LETTER DT. 01-03-2010 WAS ABLE TO EXPLAIN THE REMITTANCE OF TDS TO THE TUNE OF RS. 22,50,654/-. HOWEVER, THE ASSESSEE COULD NOT SHOW THE REMITTANCE OF FOLLOWING AMOUNTS OF TDS: S.NO. UNDER SECTION NATURE OF PAYMENT TDS AMOUNT RS. 1 194A INTEREST OTHER THAN INTEREST ON SECURITIES 85,31,078 2 194H COMMISSION & BROKERAGE 6,08,679 THE ASSESSING OFFICER VIDE ASSESSMENT ORDER U/S. 20 1(1) & 201(1A) OF THE ACT DATED 18-10-2010 MADE ADDITION T O THE TUNE OF RS. 1,14,03,354/- INCLUDING LEVY OF INTEREST U/S. 2 01(1A). AGGRIEVED AGAINST THE ORDER DATED 18-10-2010, THE ASSESSEE PREFERRED AN APPEAL BEFORE THE CIT(APPEALS ). THE CIT (APPEALS) VIDE ORDER DATED 28-08-2012 PARTLY ALLOWE D THE APPEAL OF THE ASSESSEE. NOW, THE ASSESSEE HAS COME IN APP EAL BEFORE THE TRIBUNAL ASSAILING THE ORDER OF THE CIT(APPEALS ). I.T.A. NO. 2260/MDS/2012 & C.O. NO. 30/MDS/2013 :- 4 -: 4. SHRI SHAJI P. JACOB, APPEARING ON BEHALF OF THE REVENUE SUBMITTED THAT THE CIT(APPEALS) HAS MERELY RELIED O N THE SUBMISSIONS MADE BY THE ASSESSEE WITHOUT ANY SUPPOR TING EVIDENCE. THE LD. DR FURTHER SUBMITTED THAT THE CI T(APPEALS) HAS ERRED IN DIRECTING THE ASSESSING OFFICER TO REWORK THE TDS CHARGEABLE U/S. 194H ON COMMISSION AND BROKERAGE PA ID TO M/S. CHIRANJEEVI CONSULTING P. LTD., WITHOUT AFFORDING A NY OPPORTUNITY OF HEARING TO THE ASSESSING OFFICER UNDER RULE 46A TO VERIFY THE SUPPORTING EVIDENCE. THE ASSESSEE HAS DEDUCTED TAX AT SOURCE BUT HAS NOT REMITTED TO THE GOVERNMENT TREASURY. O NCE THE TAX HAS BEEN DEDUCTED WHETHER RIGHTLY OR WRONGLY, THE A SSESSEE IS LIABLE TO REMIT THE TAX DEDUCTED TO THE GOVERNMENT EXCHEQUER. IN SUPPORT OF HIS CONTENTIONS, THE LD. DR RELIED ON TH E ORDER OF THE TRIBUNAL IN THE CASE OF BLOCK DEVELOPMENT OFFICER VS. ITO (TDS) REPORTED AS 5 ITR (TRIB) 426 . THE LD. DR FURTHER SUBMITTED THAT ONCE THE ASSESSEE FAILS TO REMIT THE AMOUNT DEDUCTE D AS TAX AT SOURCE THE ASSESSEE IS LIABLE TO PAY INTEREST U/S. 201(1A) FROM THE DATE ON WHICH TAX IS TO BE DEDUCTED AT SOURCE TO TH E ACTUAL DATE OF PAYMENT. THE LEVY OF INTEREST IS AUTOMATIC AND THE DETERMINATION ON THE ULTIMATE LIABILITY OF THE PAYEE COMPANY TO P AY OR NOT TO I.T.A. NO. 2260/MDS/2012 & C.O. NO. 30/MDS/2013 :- 5 -: MAKE PAYMENT BEING A PROCEDURAL EXERCISE AS NOTHING TO DO WITH THE LIABILITY OF THE ASSESSEE TO DEDUCT TAX AT SOUR CE. THE LD. DR RELIED ON THE JUDGMENT OF THE HONBLE MADRAS HIGH C OURT IN THE CASE OF CIT VS. CHENNAI METROPOLITAN WATER SUPPLY AND SEWERAGE BOARD REPORTED AS 348 ITR 530 (MAD) . THE LD. DR CONTENDED THAT SINCE THE ASSESSING OFFICER WAS NOT GRANTED OPPORTUNITY TO VERIFY THE DOCUMENTS WHICH WERE FIRS T TIME PLACED BEFORE THE CIT(APPEALS), THE MATTER HAS TO BE REMIT TED BACK TO ASSESSING OFFICER TO VERIFY THE VERACITY OF THE DOC UMENTS. 5. SHRI S. SRIDHAR, APPEARING ON BEHALF OF THE ASSE SSEE SUBMITTED THAT THE ASSESSEE HAS FILED CROSS-OBJECTI ONS IN SUPPORT OF THE ORDER OF THE CIT(APPEALS). THE LD. COUNSEL CONTENDED THAT ALTHOUGH THE ORDER OF THE CIT(APPEALS) IS A WELL RE ASONED AND DETAILED ORDER, HOWEVER, HE HAS NO OBJECTION IF THE MATTER IS REMITTED BACK TO ASSESSING OFFICER TO VERIFY THE VE RACITY OF THE DOCUMENTS SUBMITTED BY THE ASSESSEE BEFORE THE CIT( APPEALS). 6. WE HAVE HEARD THE SUBMISSIONS MADE BY THE REPRESENTATIVES OF BOTH THE SIDES. WE HAVE ALSO PE RUSED THE ORDERS OF THE AUTHORITIES BELOW. IT IS AN ADMITTED FACT THAT CERTAIN I.T.A. NO. 2260/MDS/2012 & C.O. NO. 30/MDS/2013 :- 6 -: DOCUMENTS WERE PLACED ON RECORD BY THE ASSESSEE BEF ORE CIT(APPEALS) WHICH WERE NOT AVAILABLE BEFORE THE AS SESSING OFFICER. IN VIEW OF THE STATEMENT MADE BY THE REPR ESENTATIVES OF BOTH THE SIDES, WE DEEM IT APPROPRIATE TO REMIT THE CASE BACK TO THE ASSESSING OFFICER TO VERIFY THE VERACITY OF THE DOCUMENTS FILED BY THE ASSESSEE BEFORE THE CIT(APPEALS) AND DECIDE THE MATTER AFRESH. NEEDLESS TO SAY THAT BEFORE DECIDING THE I SSUE, THE ASSESSING OFFICER SHALL GRANT REASONABLE OPPORTUNIT Y OF HEARING TO THE ASSESSEE IN ACCORDANCE WITH LAW. ACCORDINGLY, THE APPEAL OF THE REVENUE IS ALLOWED FOR STATISTICAL PURPOSES AND CROSS-OBJECTION OF THE ASSESSEE IS DISMISSED. ORDER PRONOUNCED ON WEDNESDAY, THE 17 TH JULY, 2013 AT CHENNAI. SD/- SD/- (ABRAHAM P. GEORGE) ACCOUNTANT MEMBER (VIKAS AWASTHY) JUDICIAL MEMBER DATED: 17 TH JULY, 2013 TNMM COPY TO: ASSESSEE/AO/CIT(A)/CIT/DR