PIRAMAL ESTATE P.LTD, MUMBAI V. DCIT 7(1), MUMBAI

ITA 1078/MUM/2017

• Counselvise Citation: [2018] 112 COUNSELVISE.COM (IT) 5253 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 7 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-10-2018
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: C
• Assessment Year: 2005-2006
• Appeal Filed On: 15-02-2017
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: M C OM C NINGSHEN
• Assessee Lawyers: RONAK GDOSHI MS MANSHIPADHIAR
• Keywords: TDS; Set aside
• Section: 246A; 154

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES C , MUMBAI BEFORE SHRI B.R. BASKARAN (AM) AND SHRI RAM LAL NEGI (JM) ITA NO. 1078 /MUM/2017 ASSESSMENT YEAR: 2005 - 06 M/S PIRAMAL ESTATES PRIVATE LIMITED, PIRAMAL TOWER, GANPATRAOKADAM MARG, LOWER PAREL, MUMBAI - 400013 PAN: AACCA7777K VS. THE DY. COMMISSIONE R OF INCOME TAX 7(1), ROOM NO. 130, AAYKARBHAVAN, M.K. ROAD, MUMBAI - 400020 (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI RONAK GDOSHI/ MS. MANSHIPADHIAR ( AR ) REVENUE BY : SHRI M.C. OM C NINGSHEN (DR) DATE OF HEARING: 16/07/2018 DATE OF PRONOUNCEMENT: 10 /10 /2018 O R D E R PER RAM LAL NEGI, JM THIS APPEAL HAS BEEN FILED BY THE ASSESSEE AGAINST ORDER DATED 02.11.2016 PASSED BY THE LD. COMMISSIONER OF INCOME TAX (APPEALS) (FOR SHORT THE CIT (A)) - 1 3 , MUMB AI, FOR THE ASSESSMENT YEAR 2005 - 06 , WHEREBY THE LD. CIT (A) HAS DISMISSED THE APPEAL FILED BY THE ASSESSEE AGAINST RECTIFICATI ON ORDER PASSED BY THE AO U /S 154 OF THE INCOME TAX ACT, 1961 (FOR SHORT THE ACT). 2. AS PER THE PLEADINGS OF THE APPELLANT/ASSESSEE, THE ASSESSEE FILED AN APPLICATION U/S 154 OF THE ACT FOR GRANTING CREDIT OF TAX DEDUCTED AT SOURCE. BUT, THE AO REJECTE D THE SAME. THE ASSESSEE CHALLENGED THE ACTION OF THE AO BY 2 ITA NO. 1078/MUM/2017 ASSESSMENT YEAR: 2005 - 06 FILING APPEAL BEFORE THE LD. CIT (A) . THE LD CIT(A) DISMISSED THE APPEAL IN LIMINE HOLDING THAT THE ASSESSEE HAS NOT FILED THE ORDER REJECTING THE APPLICATION U/S 154 OF THE ACT. 3. AGGRIEVED BY THE IMPUGNED ORDER PASSED BY THE LD. CIT (A), THE ASSESSEE HAS PREFERRED THE PRESENT APPEAL ON THE FOLLOWING GROUNDS : - GROUND NO. 1: DISMISSAL OF APPEAL BY CIT - (A) BY HOLDING THE ORDER U/S 154 OF THE ACT PASSED BY THE AO AS NOT AN APPEALABLE ORDER IS BAD IN LAW: - 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, HONBLE CIT (A) ERRED IN DISMISSING THE APPEAL FILED BEFORE HIM MERELY ON THE GROUND THAT ORDER PASSED U/S 154 OF THE ACT DATED DECEMBER, 13, 2013 IS IN LETTER FORMAT AND THUS IS NOT AN APPEALABLE ORDER. 2. HONBLE CIT (A) FAILED TO APPRECIATE AND OUGHT TO HAVE HELD THAT: A. NO SPECIFIC FORMAT HAS BEEN PRESCRIBED UNDER THE ACT FOR PASSING AN ORDER UNDER THE ACT, B. THE ORDER PASSED BY THE AO IS IN EFFECT AN ORDER U/S 154 OF THE ACT AS THE AO HAS SPECIFICALLY STATED THAT THE MISTAKE POINTED OUT IS NOT APPARENT FROM THE RECORD AND HENCE RECTIFICATION APPLICATION IS REJECTED. C. SUBSTANCE OF AN ORDER CANOT BE IGNORED MERELY BECAUSE OF ITS FORM, AND D. IT IS NOT CONTROL OF AN ASSESSEE TO ENSURE THAT AN ORDER PASSED BY THE AO IS IN A PARTICULAR FORMAT AND THUS AN ASSESSEE CANNOT BE PUNISHED/PUT TO HARDSHIP ON ACCOUNT OF A PROCEDURAL DEFECT ON PART OF THE AO. 3. THE APPELLANT PRAYS THAT IT BE HELD THAT THE ORDER PASSED BY THEAO IS AN APPEALABLE ORDER AND THE APPEAL DESERVES TO BE HEARD ON THE MERITS OF THE CASE. 3 ITA NO. 1078/MUM/2017 ASSESSMENT YEAR: 2005 - 06 WITHOUT PREJUDICE TO GROUND NO. 1 GROUND NO. II NON GRANT OF TDS CREDIT OF RS. 1,35,05,678/ - CLAIMED ON THE INCOME OF RS. 6,39,28,378/ - OFFERED TO TAX DURING THE YEAR UNDER APPEAL: 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE AO ERRED IN REJECTING THE APPLICATION U/S 154 FILED BY THE ASSESSEE AS TDS CREDIT OUGHT TO BE GRANTED IN THE YEAR IN WHICH THE CORRESPONDING INCOME HAS BEEN CHARGED TO TAX. 2. HE FAILED TO APPRECIATE AND OUGHT TO HAVE HELD THAT: A. TDS CREDIT OUGHT TO BE GRANTED IN THE YEAR IN WHICH THE CORRESPONDING INCOME HAS BEEN CHARGED TO TAX IRRESPECTIVE OF WHETHER SUCH CLAIM IS MADE OR NOT BY THE ASSESSEE. B. NON GRANT OF TDS CREDIT OF RS. 1,35, 05,678/ - ON INCOME OF RS. 6,39,28,378/ - OFFERED TO TAX IN AY 2005 - 06 IS A MISTAKE APPARENT FROM RECORD WHICH OUGHT TO BE RECTIFIED, AND C. REVENUE CANNOT RETAIN THE AMOUNT OF TAX DULY DEDUCTED AND DEPOSITED WITH THE GOVERNMENT AS IT IS CONTRAVENTION OF ARTIC LE 265 OF THE CONSTITUTION OF INDIA . 3. THE APPELLANT THEREFORE, PRAYS THAT THE AO BE DIRECTED TO GIVE FULL CREDIT TDS OF RS. 1,35,05,678/ - FOR THE YEAR UNDER APPEAL. 4. BEFORE US, T HE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE ASSESSEE HAD FILED ITS RETURN OF INCOME FOR THE ASSESSMENT YEAR UNDER CONSIDERATION DECLARING THE TOTAL LOSS OF RS. 13,66,508/ - UNDER THE NORMAL PROVISION OF THE ACT. T HE ASSESSEE FILED LETTERS FOR CLAIMING TDS OF RS. 1,35,05,678/0 FOR THE A.Y. 2005 - 06. IN RESPONS E THEREOF , THE AO PASSED ORDER U/S 154 OF THE ACT 4 ITA NO. 1078/MUM/2017 ASSESSMENT YEAR: 2005 - 06 DATED 13.12.2013 FOR THE ASSESSMENT YEAR UNDER CONSIDERATION REJECTING THE CLAIM. THE LD. COUNSEL FURTHER SUBMITTED THAT THE ASSESSE E HAS OFFERED ITS INCOME FOR THE ASSESSMENT YEAR UNDER CONSIDERATION AGAINST WHICH THE ASSESSEE SHOULD BE ALLOWED TO CLAIM CREDIT OF TDS IN THE SAME YEAR EVEN THOUGH THE COMPANY HAD NOT CLAIMED THE CREDIT FOR THE SAME IN ITS RETURN OF INCOME OF THAT ASSESSM ENT YEAR. SINCE, THE ASSESSEE HAD NOT CLAIMED TDS CREDIT OF THE AFORESAID AMOUNT IN ITS RETURN OF INCOME FOR THE NEXT A.Y. 2006 - 07. 5. ON THE OTHER HAND, THE LD. DEPARTMENTAL REPRESENTATIVE (DR) RELYING ON THE ORDER PASSED BY THE LD. CIT (A) SUBMITTED THA T SINCE THE ASSESSEE HAS FAILED TO SUBMIT THE COPY OF IMPUGNED ORDER PASSED U/S 154 OF THE ACT, THE LD. CIT (A) HAS RIGHTLY DISMISSED THE APPEAL IN LIMINE. 6. WE HAVE HEARD THE RIVAL SUBMISSIONS AND ALSO GONE THROUGH THE IMPUGNED ORDER PASSED BY THE LD. CI T (A). THE RELEVANT PORTION OF THE ORDER OF LD. CIT (A) READS AS UNDER: - THE ISSUE HERE IS THAT THERE IS NO ORDER UNDER SECTION 154 OF THE INCOME TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT) IN THE FIRST PLACE. SECTION 246A OF THE ACT LISTS OUT T HE APPEALABLE ORDERS. A SIMPLE LETTER BY THE AO CAN BY NO STRETCH BE TERMED AS AN APPEALABLE ORDERS TAKEN TO HAVE BEEN PASSED UNDER SECTION 154 OF THE ACT, RECTIFICATIONS ORDERS HAVING BEEN INCLUDED IN THE LIST OF ORDERS GIVEN IN SECTION 246A OF THE ACT. IN THESE CIRCUMSTANCES, I AM OF THE CONSIDERED VIEW THAT THE PRIMARY REQUIREMENT OF THE AVAILABILITY OF AN APPEALABLE ORDER HAS ITSELF NOT BEEN FULFILLED IN THIS APPEAL. I AM ACCORDINGLY CONSTRAINED TO DISMISS IT IN LIMINE. BEFORE PARTING I MAY ADD THAT T HE APPELLANT HAS ALSO SOUGHT TO RELY ON ANOTHER DECISION VIZ. CIT V. OCM (INDIA) P. LTD. HOWEVER, NEITHER A COPY OF SAID DECISION HAS BEEN PROVIDED, NOR HAS ANY CITATION BEEN INCLUDED IN THE SUBMISSIONS. IN THESE CIRCUMSTANCES, I HAVE NOT GONE INTO THE APP LICABILITY OF THAT SAID DECISION TO THE FACTS OF THIS CASE. 7. WE NOTICE THAT THE LD. CIT(A) HAS DISMISSED THE APPEAL IN LIMIN E ON THE GROUND THAT THE ASSESSEE HAS NOT SUBMITTED THE ORDER PASSED BY THE AO 5 ITA NO. 1078/MUM/2017 ASSESSMENT YEAR: 2005 - 06 REJECTING APPLICATION U/S 154 OF THE ACT , REJECTING THE CONTENTION OF THE ASSESSEE THAT THERE IS NO SPECIFIC FORMAT PRESCRIBED UNDER THE ACT FOR PASSING AN ORDER UNDER THE ACT. MOREOVER, THE AO HAS MENTIONED IN HIS LETTER THAT MISTAKE POINTED OUT IS NOT APPARENT WHICH REQUIRES RECTIFICATION U/S 154 OF THE ACT. IN THE LIGHT OF THE SAID FACTS, THE LD. COUNSEL SUBMITTED BEFORE US THAT THE LD. CIT(A) OUGHT TO HAVE DECIDED T HE APPEAL ON MERITS. ON MERITS, LD COUNSEL SUBMITTED THAT REFUSAL TO GRANT TDS CREDIT OF RS. 1,35,05,678/ - ON INCOME OF RS. 6,39 ,28,378/ - OFFERED IN TAX IN AY 2005 - 06 IS A MISTAKE APPARENT AND THE SAME IS REQUIRED TO BE RECTIFIED. WE FIND THAT IN RESPONSE TO LETTER DATED 07.11.2007, THE ASSESSEE CLAIMED CREDIT FOR TAX DEDUCTED AT SOURCE AMOUNTING TO RS. 1,35,05,678/ - AND ALSO ENC LOSED THE CERTIFICATES DATED 09.07.2005, 20.07.2005 AND 15.07.2005, COPIES OF WHICH ARE AVAILABLE IN THE PAPER BOOK AT PAGE 23, 24 AND 25 RESPECTIVELY. THE ASSESSEE HAS SUBMITTED COPY OF THE ORDER DATED 13.12.2013 PASSED ON THE APPLICATION FILED U/S 154 OF THE ACT FOR RECTIFICATION, ALONG WITH THE MEMORANDUM OF APPEAL BEFORE THE TRIBUNAL. UNDER THESE CIRCUMSTANCES, WE ARE OF THE CONSIDERED VIEW THAT THE APPEAL IS REQUIRED TO BE DECIDED ON MERITS IN THE INTEREST OF JUSTICE. WE THEREFORE, WITHOUT GOING INTO T HE MERITS OF THE APPEAL, SET ASIDE THE IMPUGNED ORDER AND REMAND THE APPEAL BACK TO THE LD. CIT(A) FOR ADJUDICATING THE ISSUES INVOLVED IN THE INSTANT APPEAL ON MERITS AFTER HEARING THE APPELLANT/ASSESSEE. IN THE RESULT, APPEAL FILED BY THE A SSESSEE FOR AS SESSMENT YEAR 2004 - 2005 IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 10 TH OCTOBER , 2018. SD/ - SD/ - ( B.R. BASKARAN ) (RAM LAL NEGI) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI ; DATED: 10 / 10 / 2018 ALINDRA, PS 6 ITA NO. 1078/MUM/2017 ASSESSMENT YEAR: 2005 - 06 / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT(A) - 4. / CIT 5. , , / DR, ITAT, MUMBAI 6. / GUARD FILE . / BY ORDER, //TRUE COPY// / (DY./ASSTT.REGISTRAR) , / ITAT, MUMBAI