M/s D.D Mango Co, Jalandhar V. The Income Tax Officer, Jalandhar

ITA 101/ASR/2017

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 7981 (ITAT-AMRITSAR)
• Duration Of Justice: 1 year(s) 1 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-04-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2013-2014
• Appeal Filed On: 20-02-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: J S BHASIN
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH, AMRITSAR. BEFORE SH. SANJAY ARORA, ACCOUNTANT MEMBER AND SH. N. K. CHOUDHRY, JUDICIAL MEMBER I.T.A. NO. 101/(ASR)/2017 AS SESSMENT YEAR: 2013-14 D. D. MANGO CO., 37, NEW SABZI MANDI, JALANDHAR [PAN: AAIFD 1592L] VS. INCOME TAX OFFICER, WARD-1(1), JALANDHAR (APPELLANT) (RESPONDENT) APPELLANT BY : SH. J. S. BHASIN (ADV.) RESPONDENT BY: SH. CHARAN DASS (D.R.) DATE OF HEARING: 28.03.2018 DATE OF PRONOUNCEMENT: 09.04.2018 ORDER PER SANJAY ARORA, AM: THIS IS AN APPEAL BY THE ASSESSEE DIRECTED AGAINST THE ORDER BY THE COMMISSIONER OF INCOME TAX (APPEALS)-1, JALANDHAR ( 'CIT(A)' FOR SHORT) DATED 24.01.2017, DISMISSING THE ASSESSEES APPEAL CONTES TING HIS ASSESSMENT U/S. 143(3) OF THE INCOME TAX ACT, 1961 ('THE ACT' HEREINAFTER) DATED 31.12.2015 FOR ASSESSMENT YEAR (AY) 2013-14. 2. THE ONLY ISSUE ARISING IN THIS APPEAL IS THE SUS TAINABILITY OF THE DISALLOWANCE U/S. 40(A)(IA) OF THE ACT EFFECTED BY THE ASSESSING OFFICER (AO) AND CONFIRMED BY THE LD. CIT(A). THE SAME IS IN RESPECT OF INTEREST ALLOWED BY THE ASSESSEE TO THREE ITA NO. 101 (ASR)/2017(AY 2013-14) D. D. MANGO CO. V. ITO 2 INDIVIDUAL DEPOSITORS, AS UNDER, IN EXCESS OF RS. 5 ,000/- EACH, SO THAT THE TAX AT SOURCE WAS REQUIRED TO BE DEDUCTED THEREON U/S. 194 A, WHICH THE ASSESSEE FAILED TO: S.NO. NAME OF PERSON INTEREST PAID (IN RS.) 1 SMT. NEELAM 1,14,540/- 2 SMT. VEENA 1,33,654/- 3 SMT. GEETA 1,30,270/- TOTAL 3,78,464/- THE ASSESSEES CASE IS THAT THIS IS SO AS THE PAYEE S HAVE NO OTHER INCOME, AND THAT THEIR INCOME FOR THE RELEVANT YEAR THEREFORE IS NOT LIABLE TO TAX. THE PAYEES HAD IN FACT FURNISHED DECLARATIONS IN FORM 15H BY THE END OF THE RELEVANT YEAR, I.E., 31.03.2013, WHICH THOUGH HAVE BEEN MISPLACED. AFFID AVITS DATED 31.12.2015 BY THE DEPOSITORS TO THE EFFECT THAT THEIR INCOME FOR THE YEAR IS BELOW THE MAXIMUM AMOUNT NOT CHARGEABLE TO TAX, HAD BEEN FURNISHED IN THE ASSESSMENT PROCEEDINGS, AND WHICH HAVE ALSO NOT BEEN CONSIDERED BY THE LD. CIT(A). 3. WE HAVE HEARD THE PARTIES, AND PERUSED THE MATER IAL ON RECORD. WITHOUT DOUBT, IT IS ONLY ON THE DEPOSITOR/S FURNIS HING A DECLARATION IN FORM 15H/15G THAT THE ASSESSEES OBLIGATION TO DEDUCT AT SOURCE U/S. 194A STANDS DISCHARGED. RELIANCE ON THE AFFIDAVITS, WHICH WERE EVEN OTHERWISE FILED ON THE DATE OF THE PASSING OF THE ASSESSMENT ORDER (SO THAT THE HEARING IN THE ASSESSMENT PROCEEDINGS WOULD HAVE ONLY BEEN CLOSED BY THEN), W OULD NOT SUBSTITUTE THE SAID DECLARATIONS PRESCRIBED BY LAW. THERE IS IN FACT NO REFERENCE TO THE FURNISHING OF THE SAID DECLARATIONS BY THE DEPOSITORS IN THEIR AFFIDA VITS. HOW, THEN, WE WONDER, IS THE REVENUE IN THE WRONG IN HOLDING THAT THE PROVISION OF 40(A)(IA) STANDS ATTRACTED. IF THE DECLARATIONS FORM 15H HAD BEEN, AS STATED, MISP LACED, WHY WE WONDER SHOULD NOT THE ASSESSEE OBTAIN A DUPLICATE FROM THE DEPOSI TORS, STATED TO BE FAMILY ITA NO. 101 (ASR)/2017(AY 2013-14) D. D. MANGO CO. V. ITO 3 MEMBERS. THE WORD DUPLICATE COULD BE SUBSCRIBED A T ITS TOP TO ALLAY ANY APPREHENSION THAT MAY BE ENTERTAINED BY THE DEPOSIT ORS ON BEING CALLED UPON TO FURNISH THE SAID DECLARATION AGAIN. IT IS ONLY THEN , I.E., ON THE FILING OF THE FORM 15H WITH THE REVENUE (AO), THAT THE OBLIGATION ON THE A SSESSEE TO DEDUCT TAX AT SOURCE WOULD GET WAIVED (SECTION 197A(1A) READ WITH SEC. 1 97A(1B)). UNLESS THE SAME IS DONE, THE OBLIGATION ON THE ASSESSEE TO DEDUCT TAX AT SOURCE CANNOT BE SAID TO BE DISCHARGED, OR PRESUMED TO BE SO. THE VERACITY AND THE GENUINENESS OF THE SAID DECLARATIONS COULD OF COURSE BE VERIFIED BY THE AO. WE, ACCORDINGLY, CONSIDER IT PROPER, IN VIEW OF TH E CANDID ADMISSION OF DEFAULT, I.E., MISPLACEMENT OF THE SAID DECLARATION FORMS, DULY FURNISHED BY THE DEPOSITORS, AS STATED BEFORE US, THAT THE MATTER IS RESTORED BACK TO THE FILE OF THE AO TO AFFORD ONE FINAL OPPORTUNITY TO THE ASSESSEE TO SUBSTANTIATE ITS CASE BEFORE THE AO, I.E., U/S. 197A(1A) R/W S. 197A(1B). TRUE, THE ACCEPTANCE OF THE DEFAULT BY THE ASSESSEE SHOULD HAVE BEEN CONVEYED BY WAY OF AN AFF IDAVIT, AVERRING THE SAID FACT AND, IN FACT, BEFORE THE REVENUE AUTHORITIES. SO, H OWEVER, WE TAKE COGNIZANCE OF THE FACT-SITUATION THAT A PARTNER, SHRI DARSHAN LAL DUA, AS INFORMED BY THE LD. COUNSEL, SH. BHASIN, HANDLING THE FIRMS TAX MATTER S, HAS SINCE EXPIRED AND, FURTHER, EVEN THE ACCOUNTANT OF THE FIRM AT THE RELEVANT TIM E IS NO MORE. WE, THEREFORE, DO NOT ATTACH AS MUCH SIGNIFICANCE TO THE COMMUNICATIO N OF THE SAID DEFAULT FOR THE FIRST TIME BEFORE US AS WE WOULD OTHERWISE HAVE, PE RHAPS OUSTING THE SAME AS AN AFTERTHOUGHT. WE ARE ALSO CONSCIOUS THAT THE DEPOSI TORS HAVE IN THEIR AFFIDAVITS NOT AVERRED WITH REGARD TO THE FURNISHING OF THE DECLAR ATIONS, SO THAT THERE IS NO CORROBORATION OR EVIDENCE OF THERE HAVING, AS STATE D, FURNISHED THE DECLARATIONS EARLIER, AND IN TIME. AGAIN, WE MAKE LIGHT OF THIS OMISSION OR DISCREPANCY CONSIDERING THAT THE DEPOSITORS WOULD BE IN ANY CAS E (PRESUMABLY) FILING THE DUPLICATE DECLARATIONS, SO THAT THE SAME WOULD BE A TACIT ADMISSION OF THEIR HAVING FURNISHED THE DECLARATIONS EARLIER. IN CASE OF FAIL URE TO FILE THE SAME, THE ASSESSEES ITA NO. 101 (ASR)/2017(AY 2013-14) D. D. MANGO CO. V. ITO 4 DEFAULT U/S. 194A AND, CONSEQUENTLY, APPLICABILITY OF SECTION 40(A)(IA), WOULD OBTAIN. WE THOUGH MAKE IT ABUNDANTLY CLEAR THAT THE AO IS AT LIBERTY TO VERIFY THE CONTENTS AND THE AUTHENTICITY OF THE SAID DECLARATI ONS, WHERE FILED IN THE SET ASIDE PROCEEDINGS, AND DECIDE THE QUESTION OF THE APPLICA BILITY OF SECTION 40(A)(IA) IN THE FACTS OF THE CASE BY ISSUING DEFINITE FINDINGS OF F ACT, IN ACCORDANCE WITH THE LAW, AND AFTER AFFORDING A REASONABLE OPPORTUNITY TO THE ASSESSEE TO STATE AND EXHIBIT ITS CASE. WE DECIDE ACCORDINGLY. 4. IN THE RESULT, THE ASSESSEES APPEAL IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON APRIL 09, 201 8 SD/- SD/- (N. K. CHOUDHRY) (SANJAY ARORA) JUDICIAL MEMBER ACCOUNTANT MEMBER DATE: 09.04.2018 /GP/SR. PS. COPY OF THE ORDER FORWARDED TO: (1)THE APPELLANT: D. D. MANGO CO., 37, NEW SABZ I MANDI, JALANDHAR (2) THE RESPONDENT: I.T.O., WARD-1(1), JALANDHA R (3) THE CIT(APPEALS)-1, JALANDHAR (4) THE CIT CONCERNED (5) THE SR. DR, I.T.A.T TRUE COPY BY ORDER