ACIT, CIR-3(TDS), KOLKATA, Kolkata V. Haldia Municipality, Purba Medinipur

ITA 1070/KOL/2016

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 0758 (ITAT-KOLKATA)
• Duration Of Justice: 1 year(s) 7 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-12-2017
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: C
• Assessment Year: 2011-2012
• Appeal Filed On: 17-05-2016
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Section: 194C

Judgement Text

IN THE INCOME TAX APPELLATE TR IBUNAL KOLKATA C BENCH, KOLKATA [BEFORE SRI J. SUDHAKAR REDDY, ACCOUNTANT MEMBER & SRI ABY T. VARKEY, JUDICIAL MEMBER] I.T.A. NO. 1070/KOL/2016 ASSESSMENT YEAR: 2011-12 A.C.I.T., CIRCLE-3(TDS), KOLKATA ... APPELLANT ASSTT. COMMISSIONER OF INCOME TAX,TDS, KOLKATA 10-B, MIDDLETOWN ROW 8 TH FLOOR KOLKATA 700 071 HALDIA MUNICIPALITY..... ....RESPONDENT DR. B.R. AMBEDKAR BHAWAN CITY CENTER, HALDIA PURBA MEDNIPORE WEST BENGAL 721 657 [TAN : CALH 0260 B] APPEARANCES BY: NONE, APPEARED ON BEHALF OF THE ASSESSEE. SHRI S.M.S. TAUHEED, ADDL. CIT, DR APPEARING ON BEH ALF OF THE REVENUE. DATE OF CONCLUDING THE HEARING : DECEMBER 14 TH , 2017 DATE OF PRONOUNCING THE ORDER : DECEMBER 21 ST , 2017 O R D E R PER J. SUDHAKAR REDDY :- THIS APPEAL FILED BY THE REVENUE IS DIRECTED AGAINS T THE ORDER OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS)-24, KOLKATA, ( HEREINAFTER THE LD. CIT (A)), PASSED U/S 250 OF THE INCOME TAX ACT, 1961 (THE AC T), DT. 14/03/2016, FOR THE ASSESSMENT YEAR 2011-12, ON THE FOLLOWING GROUNDS:- 1. IN THE FACTS AND CIRCUMSTANCES OF THE CASE THE LD. C.I.T(A)-24/ KOLKATA, HAS ERRED IN DIRECTING THE A.O. TO VERIFY WHETHER R ECIPIENT KOLKATA PORT TRUST HAS PAID TAX ON THE RENT DEBITED IN THE ACCOU NTS OF THE ASSESSEE DEDUCTOR AS SUCH DIRECTION TANTAMOUNT TO SETTING AS IDE FOR REJUDICATION. THE CIT(A) IS NOT EMPOWERED TO DO SO AS PER AMENDED PRO VISION OF SECTION 251(1)(A) OF THE ACT. 2 I.T.A. NO. 1070/KOL/2016 ASSESSMENT YEAR: 2011-12 HALDIA MUNICIPALITY 2. UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE TH E LD. CIT(A) HAS ERRED IN DIRECTING THE A.O. TO TREAT THE PAYMENTS MADE TO WB WML U/S 194C, THOUGH THE TYPE OF EXPENSE BY HALDIA MUNICIPALITY COMES UN DER THE PURVIEW OF 194J. 3. THE APPELLANT CRAVES LEAVE TO ADD, ALTER/MODIFY THE GROUND OF APPEAL DURING THE COURSE OF HEARING. 2. AFTER HEARING RIVAL CONTENTIONS, WE HOLD AS FOLL OWS:- 2.1. AS FAR AS GROUND NO.1 IS CONCERNED, WE AGREE W ITH THE LD. D/R, THAT THE LD. FIRST APPELLATE AUTHORITY, HAS NO POWER TO SET ASID E THE ISSUE FOR RE-ADJUDICATION TO THE LD. ASSESSING OFFICER. HENCE THIS GROUND IS DIS MISSED TO THIS EXTENT. AT THE SAME TIME, WE FIND THAT THE FACTS AND CIRCUMSTANCES OF T HE CASE DEMAND THAT THE ORDER TO BE SET ASIDE TO THE FILE OF THE ASSESSING OFFICER F OR EXAMINING WHETHER KOPT PAID TAX ON INCOME CONTAINED IN THE RENT OF RS.2,59,40,7 96/-, DETERMINED FOR THE FINANCIAL YEAR 2010-11. HENCE WE EXERCISE OUR POWER S OF SET ASIDE AND RESTORE THIS ISSUE TO THE ASSESSING OFFICER FOR VERIFICATION AS TO WHETHER KOPT HAD PAID TAX AS RENT. HENCE THIS GROUND IS ALLOWED FOR STATISTICAL PURPOSES. 3. ON GROUND NO. 2, WE FIND THAT THE LD. CIT(A) AT PARA 2.1. STATED THAT SECTION 194C OF THE ACT, APPLIES TO THE FACTS AND CIRCUMSTA NCES OF THE CASE AND HELD AS FOLLOWS:- THE APPELLANT HAS ENTRUSTED THE WORK OF WASTE DISP OSAL TO WBWML, WHICH APPARENTLY OPERATES THE FACILITY ON ITS OWN B EHALF AND CARRIES OUT THE DISPOSALS OF WASTES IN RETURN FOR SUMS PAID BY THE APPELLANT. IN ANY CASE, THE A.O. HAS NOT MADE A CASE THAT SOME KN OWHOW OR TECHNIQUE OR SKILL WAS TRANSFERRED TO THE APPELLANT . DRAWING FROM VARIOUS JUDICIAL DECISIONS IT CAN BE STATED THAT AN Y WORK OR SERVICE IN TO- DAY'S ECONOMY REQUIRES SPECIFIED SKILLS AND, TH EREFORE, IF REQUIREMENT OF SUCH A SKILL ON THE PART OF SERVICE PROVIDER BE TAKEN AS ONLY CRITERION FOR APPLICATION OF SECTION 194J THEN ALL SERVICES MAY BE HIT BY SECTION 194J. IN SUCH CASES, ONE HAS TO SEE WHETHER ANY SKILL OR KNOWHOW WAS TRANSFERRED BY THE SERVICE PROVIDER TO THE PERSON MAKING PAYMENTS. AS NO SUCH CASE EXISTS IN THE APPE LLANT'S CASE THE A.O.'S ACTION CANNOT BE SUSTAINED. I HOLD THAT THE APPELLANT HAS RIGHTLY 3 I.T.A. NO. 1070/KOL/2016 ASSESSMENT YEAR: 2011-12 HALDIA MUNICIPALITY DEDUCTED TDS @ 2% U/S.194C. THE LIABILITY DETERMINE D BY THE A.O. THUS IS DELETED. 4. WE UPHOLD THIS FINDING OF THE LD. LD. FIRST APPE LLATE AUTHORITY AND ACCORDINGLY DISMISS THIS GROUND OF THE REVENUE. 5. IN THE RESULT, APPEAL OF THE REVENUE IS ALLOWED FOR STATISTICAL PURPOSES. KOLKATA, THE 21 ST DAY OF DECEMBER, 2017. SD/- SD/- [ ABY T. VARKEY ] [ J. SUDHAKAR REDDY ] JUDICIAL MEMBER ACCOUNTANT M EMBER DATED : 21.12.2017 {SC SPS} COPY OF THE ORDER FORWARDED TO: 1. M/S. POWER MAX (INDIA) LTD 19A, J.L. NEHRU ROAD KOLKATA 700 087 2. D.C.I.T., CIRCLE-8(2), KOLKATA AAYAKAR BHAWAN 4 TH FLOOR P-7, CHOWRINGHEE SQUARE KOLKATA 700 069 3. CIT(A)- 4. CIT- , 5. CIT(DR), KOLKATA BENCHES, KOLKATA. TRUE COPY BY ORDER SENIOR PRIVATE SECRETARY HEAD OF OFFICE/ D.D.O. ITAT, KOLKATA BENCHES