The Accounts Officer Directorate of Aviation, Govt. of M.P., Bhopal V. The ACIT(TDS), Bhopal

ITA 114/IND/2012

• Counselvise Citation: 11422714 RSA 2012
• Duration Of Justice: 2 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-05-2012
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB
• Assessment Year: 2008-2009
• Appeal Filed On: 02-03-2012
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: ARUN DEWAN
• Keywords: Opportunity of being heard
• Section: 201(1)

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH, INDORE BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER AND SHRI R.C. SHARMA, ACCOUNTANT MEMBER ITA NOS. 114, 115 & 116/IND/2012 AYS 2008-09, 2009-10 & 2010-11 THE ACCOUNTS OFFICER, DIRECTORATE OF AVIATION, GOVT. OF M.P., RAJA BHOJ AIRPORT, BHOPAL PAN BPLDO 1037 B :: APPELLANT VS ACIT-TDS, BHOPAL :: RESPONDENT APPELLANT BY SHRI SUMIT NEMA & SHRI AMIT JAIN RESPONDENT BY SHRI ARUN DEWAN DATE OF HEARING 7 . 5 .2012 DATE OF PRONOUNCEMENT 7 . 5 .2012 O R D E R 2 PER JOGINDER SINGH , JUDICIAL MEMBER THE ASSESSEE IS AGGRIEVED BY THE COMMON IMPUGNED ORDER DATED 25.1.2012, PASSED BY THE LEARNED FIRST APPELLATE AUTHORITY, BHOPAL. THE GROUND RAISED BY THE ASSESSEE IS THAT THE LEARNED FIRST APPELLATE AUTHORITY W AS ERRONEOUS BOTH IN LAW AND FACTS, WITHOUT APPRECIATING THE PROVISIONS OF TDS, PURPOSE THEREOF, SINCE TDS IS ON LY A PROVISIONAL DEDUCTION WHICH IS SUBJECT TO FINAL ASSESS MENT OF THE PAYEE AND ULTIMATELY CANNOT BE RECOVERED BY TH E PAYER, IN CASE THE PAYEE HAS MADE THE PAYMENT IN ITS RETURN AND FURTHER THE DEMAND OF THE TDS U/S 201(1) O F THE ACT IS ILLEGAL AND UNJUSTIFIED. AN ALTERNATIVE GR OUND HAS ALSO BEEN RAISED THAT ADEQUATE OPPORTUNITY OF BEING HEARD WAS NOT PROVIDED TO THE ASSESSEE AS SURVEY WAS CARRIED O UT ON 8.3.2010 AND ORDER WAS PASSED ON 22.3.2010. 2. DURING HEARING OF THESE APPEALS, WE HAVE HEARD SHRI SUMIT NEMA & SHRI AMIT JAIN, LEARNED COUNSEL FOR THE 3 ASSESSEE, AND SHRI ARUN DEWAN, LEARNED SENIOR DR. THE CRUX OR ARGUMENTS ON BEHALF OF THE ASSESSEE IS IDENTIC AL TO THE GROUND RAISED WHEREAS THE LD. SR. DR DEFENDED THE IMPUGNED ORDER. 3. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PERUSE D THE MATERIAL AVAILABLE ON RECORD. THE FACTS, IN BRIEF, ARE THAT THE ASSESSEE IS A DIRECTORATE OF AVIATION, GOVT. OF MADH YA PRADESH, NORMALLY TAKING AIRCRAFTS AND HELICOPTERS ON REN T FROM VARIOUS AVIATION COMPANIES FOR GOVERNMENT USE. TH E ASSESSEE PAYS LENDING AND PARKING CHARGES TO AIRPORT AUTHORITY OF INDIA. AS PER THE REVENUE, NO TDS WAS DEDUCTED ON PAYMENTS OF RENT TO AVIATION COMPANIES, AIRPORT AUTHORITY OF INDIA AND FRANKLIN INSTITUTE OF A IR HOSTESSES. THE LD. ASSESSING OFFICER HELD THAT THE P AYMENT OF RENT, LENDING & PARKING CHARGES WERE LIABLE TO TDS U/S 194-I OF THE ACT AND PROFESSIONAL FEE PAID TO FRANKLIN INSTITUTE WERE LIABLE TO TDS U/S 194-J OF THE ACT, T HEREFORE, 4 THE ASSESSING OFFICER HELD THE ASSESSEE IN DEFAULT WI THIN THE MEANING OF SECTION 201 AND 201(1A) OF THE ACT. ON APPEALS, THE LEARNED COMMISSIONER OF INCOME TAX (APPEAL S) CONFIRMED THE VIEW OF THE ASSESSING OFFICER, WHICH IS UNDER CHALLENGE BEFORE THIS TRIBUNAL. 4. THE ONLY GRIEVANCE OF THE ASSESSEE RELATES TO LIABIL ITY ON ACCOUNT OF TDS AND INTEREST ON THE DELAYED PAYMEN T. THE ISSUE, UNDER CONTROVERSY, HAS BEEN SETTLED BY TH E HONBLE APEX COURT IN THE CASE OF HINDUSTAN COCA COLA BEVERAGES (P) LTD.; (2007) 211 CTR 545, 293 ITR 226 (SC) ACCORDING TO WHICH IF THE DEDUCTEE HAS PAID TAXES ON I TS INCOME BY INCLUDING THE RESPECTIVE RECEIPTS WHICH W ERE DUE FROM THE ASSESSEE, NO LIABILITY FOR PAYMENT OF TDS CAN BE FASTENED ON THE ASSESSEE, MEANING THEREBY THAT THE AMOU NT OF TAX WHICH THE ASSESSEE IS LIABLE TO DEDUCT, IF PAID BY THE DEDUCTEE, THEN AGAIN MAKING THE ASSESSEE LIABLE TO PAY TAX WILL AMOUNT TO DOUBLE TAXATION ON THE SAME INCOME. 5 HOWEVER, THE HONBLE SUPREME COURT HAS HELD THAT THE ASSESSEE DEDUCTOR IS LIABLE TO PAY TAX FROM THE DATE WHEN HE WAS LIABLE TO DEDUCT TAX TILL THE DATE OF ACTUAL PAYM ENT OF TAX BY THE DEDUCTEE. APPLYING THE PROPOSITION O F LAW LAID DOWN BY THE HONBLE SUPREME COURT, WE RESTORE THE I SSUE BACK TO THE FILE OF THE ASSESSING OFFICER AND DIRECT HIM TO VERIFY AS TO THE AMOUNT OF TAX WHICH THE ASSESSEE WAS L IABLE TO DEDUCT AND THE AMOUNT OF TAX ACTUALLY PAID BY THE DEDUCTEE BY INCORPORATING THE RESPECTIVE RECEIPTS IN THEIR INCOME. THE ASSESSING OFFICER IS TO FIND OUT THE AC TUAL DATE OF PAYMENT OF TAX BY THE DEDUCTEE IN RESPECT OF INC OME PAID BY THE DEDUCTOR TO THE DEDUCTEE. THE INTEREST IS LE VIABLE UNDER SECTION 201(1A) OF THE ACT FROM THE DATE THE D EDUCTOR ASSESSEE IS LIABLE TO DEDUCT TAX AT SOURCE TILL THE ACT UAL PAYMENT OF TAX BY THE DEDUCTEE. AFTER VERIFYING THE SE FACTS, THE ASSESSING OFFICER IS TO DECIDE THE MATTER IN TER MS OF THE DECISION OF THE HONBLE APEX COURT, AS DISCUSSED ABOV E. 6 NEEDLESS TO MENTION HERE THAT DUE OPPORTUNITY OF BEI NG HEARD BE PROVIDED TO THE ASSESSEE WITH FURTHER LIBERT Y TO FURNISH EVIDENCE, IF ANY, TO SUBSTANTIATE THE CLAIM. FINALLY, ALL THE APPEALS OF THE ASSESSEE ARE PARTLY ALLOWED FOR STATISTICAL PURPOSES IN THE TERMS INDICATED HEREINABOVE. THIS ORDER WAS PRONOUNCED IN THE OPEN COURT IN THE PRESENCE OF LD. REPRESENTATIVES OF BOTH SIDES AT THE CONCLUSION OF THE HEARING ON 7.5.2012. SD SD (R.C.SHARMA) (JOGINDER SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 7.5.2012 COPY TO: APPELLANT, RESPONDENT, CIT, CIT(A), DR, GU ARD FILE !VYS!