ACIT, New Delhi V. M/s GardeniaAims Developers Pvt. Ltd, Noida

ITA 103/DEL/2016

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 2833 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 1 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-02-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Assessment Year: 2010-2011
• Appeal Filed On: 07-01-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: NAINA SOIN KAPILA
• Assessee Lawyers: VK JAIN CA SHRI VIKASH SINGH
• Keywords: TDS

Judgement Text

PAGE | 1 INCOME TAX APPELLATE TRIBUNAL DELHI BENCH D : NEW DELHI BEFORE SMT BEENA A. PILLAI , JUDICIAL MEMBER AND SHRI PRASHANT MAHARISHI, ACCOUNTANT MEMBER ITA NO. 103/DEL/2016 (ASSESSMENT YEAR: 2010 - 11 ) ACIT, CIRCLE - 74(1), 413, AYAKAR BHAWAN, LAXMI NAGAR, DISST. CEENTREW, NEW DELHI VS. GARDENIAAIMS DEVELOPERS PVT. LTD, PLOT NO. GH - 1, SECTOR - 46, NOIDA PAN: DELGI2197D (APPELLANT) (RESPONDENT) REVENUE BY : MS. NAINA SOIN KAPILA, SR DR ASSESSEE BY: SHRI V.K. JAIN, CA SHRI VIKASH SINGH, CA DATE OF HEARING 31/01 / 2019 DATE OF PRONOUNCEMENT 1 0 3 / 02 / 2019 O R D E R PER PRASHANT MAHARISHI, A. M. 1 . THIS IS AN APPEAL FILED BY THE REVENUE AGAINST THE ORDER OF THE LD CIT(A) - 39, NEW DELHI DATED 30.10.2015 FOR THE ASSESSMENT YEAR 2011 - 12. 2 . THE REVENUE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL: - 1. HOLDING THAT THE NOIDA IS A NOTIFIED CORPORATION ESTABLISHED BY A CENTRAL, STATE OR PROVINCIAL ACT WITHIN THE MEANING OF SECTION 194A (3)(III)((F) OF THE INCOME TAX ACT, 1961 AND NO TDS ON THE INTEREST PAID TO NOIDA IS CHARGEABLE TO TDS BUT NOT APPRECIATING THAT THE CORPORATION HAS BEEN ESTABLISHED UNDER A PROVINCIAL ACT AND NOT BY A PROVINCIAL ACT AS CLEARLY DIFFERENTIATED BY THE HONBL E APEX COURT IN THE . CASE OF M/ S DALCO ENGINEERING PVT LTD VS SATISH PRABHAKAR PADHEY AND OTHERS. 2. ACCEPTING THAT NOIDA FALLS IN AMBIT OF NOTIFICATION S.O. NO.3489 DATED 22.10.1970 ISSUED BY THE GOVERNMENT BY IGNORING THE FACT THAT NOIDA IS NOT EVEN A LOCAL AUTHORITY UNDER SECTION 10(20) OF THE ACT AND ITS INCOME IS NOT EXEMPTED AS ADJUDICATED BY THE HONBLE ALLAHABAD HIGH COURT IN WRIT TAX NO. 1338 OF 2005. 3 . BRIEF FACTS OF THE CASE SHOWS THAT ASSESSEE IS A COMPANY ENGAGED IN THE BUSINESS OF REALISTIC DEVELOPMENT AND CONSTRUCTION COMPANY. THE CASE OF THE ASSESSEE WAS PICKED UP FOR VERIFICATION AND IT WAS FOUND THAT ASSESSEE HAS PAID INTEREST TO NEW OKHLA DEVELOPMENT AUTHORITY AND HAS NOT DEDUCTED PAGE | 2 TAX AT SOURCE UNDER SECTION 194A OF THE INCOME TAX ACT. THEREFORE THE LEARNED ASSESSING OFFICER FOUND THAT ASSESSEE HAS PAID INTEREST OF INR 7 8094060/ ON WHICH TAX SHOULD HAVE BEEN DEDUCTED UNDER SECTION 194A OF THE INCOME TAX ACT OF INR 7 809406/ AND INTEREST THEREON OF RUPEES TO 811386/ UNDER THE PROVISI ONS OF SECTION 201 (1) AND 201 (1A) OF THE INCOME TAX ACT. ACCORDINGLY ORDER UNDER SECTION 201 (1) READ WITH SECTION 201 (1A) OF THE INCOME TAX ACT WAS PASSED BY THE ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE 50 (1), NEW DELHI ON 28/03/2013. 4 . THE ASSESSE E BEING AGGRIEVED WITH THE ORDER OF THE LEARNED ASSESSING OFFICER PREFERRED AN APPEAL BEFORE THE COMMISSIONER OF INCOME TAX (APPEALS) 39, NE WHEREIN WIDE ORDER DATED 30/10/2015 THE LEARNED CIT A HELD THAT NOIDA IS A NOTIFIED CORPORATION ESTABLISHED BY THE CENTRAL STATE OR PROVINCIAL ACT WITHIN THE MEANING OF SECTION 194A (3) (III) (F) OF THE INCOME TAX ACT 1961 AND THEREFORE ANY INTEREST PAID BY THE ASSESSEE TO NOIDA IS NOT SUBJECT TO TAX DEDUCTION AT SOURCE. 5 . THEREFORE, REVENUE HAS AGREED WITH THE ORDER OF THE LEARNED CIT A HAS PREFERRED THIS APPEAL. THE LEARNED DEPARTMENTAL REPRESENTATIVE 70 SUPPORTED THE ORDER OF THE LEARNED ASSESSING OFFICER AND STATED THAT THE ASSESSEE SHOULD HAVE DEDUCTED TAX AT SOURCE ON INTEREST PAID BY IT TO THE NOIDA. 6 . THE LE ARNED AUTHORISED REPRESENTATIVE VEHEMENTLY STATED THAT THE ISSUE SQUARELY COVERED IN FAVOUR OF THE ASSESSEE BY THE DECISION OF THE HONOURABLE DELHI HIGH COURT IN CASE OF RAJESH PROJECTS (INDIA) PRIVATE LTD VS COMMISSIONER OF INCOME TAX (TDS) VIDE ORDER DAT ED 16 TH /2/2017. HE FURTHER STATED THAT THE ISSUE IS SQUARELY COVERED BY THE DECISION OF THE HONOURABLE SUPREME COURT IN CASE OF COMMISSIONER OF INCOME TAX (TDS), KANPUR VS CANARA BANK IN CIVIL APPEAL NUMBER 6020 OF 2018 WHEREIN IN PARA NUMBER 31 AND 32 THE ISSUE IS SQUARELY COVERED IN FAVOUR OF THE ASSESSEE. 7 . WE HAVE CAREFULLY CONSIDERED THE RIVAL CONTENTION AND PERUSED THE ORDERS OF THE LOWER AUTHORITIES. ADMITTEDLY IN THIS CASE THE ISSUE SQUARELY COVERED IN FAVOUR OF THE ASSESSEE BY THE DECISION OF THE HONOURABLE SUPREME COURT IN CASE OF COMMISSIONER OF INCOME TAX (TDS), KANPUR VS CANARA BANK WHEREIN IN PARA NUMBER 31 THE HONOURABLE SUPREME COURT HAS HELD THAT THAT NOIDA PAGE | 3 HAVE BEE N ESTABLISHED BY THE 1976 ACT AND IT IS CLEARLY COVERED BY THE NOTIFICATION DATED 22/10/1970. IT IS FURTHER HELD THAT THE COMPOSITION OF THE AUTHORITY STATUTORY PROVIDED BY SECTION 3 OF 1976 ACT ITSELF AND HENCE THERE IS NO DENYING THAT THE AUTHORITY HAS BEEN CONSTITUTED BY THE ACT ITSELF. IN VIEW OF THIS WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE LEARNED CIT A. FURTHER HONOURABLE DELHI HIGH COURT IN RAJESH PROJECTS (INDIA) PRIVATE LTD VS. COMMISSIONER OF INCOME TAX DATED 16/02/2017 ALSO SQUARELY COVERED THE ISSUE IN FAVOUR OF THE ASSESSEE. IN VIEW OF THIS, BOTH THE GROUNDS OF APPEAL FILED BY THE REVENUE ARE DISMISSED. 8 . IN THE RESULT, APPEAL OF THE LEARNED ASSESSING OFFICER IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 2 8 / 02 / 2019 . - SD/ - - SD/ - ( BEENA A. PILLAI ) (PRASHANT MAHARISHI) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 2 8 / 02 / 2019 A K KEOT COPY FORWARDED TO 1 . APPLICANT 2 . RESPONDENT 3 . CIT 4 . CIT (A) 5 . DR:ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI