ACIT, Circle-16(1), Hyd, Hyderabad V. Lanco Amarkantak Power Ltd., Hyd, Hyderabad

ITA 1201/HYD/2016

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 2561 (ITAT-HYDERABAD)
• Duration Of Justice: 7 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-04-2017
• Appeal Filed By: Department
• Bench Allotted: B
• Assessment Year: 2010-2011
• Appeal Filed On: 12-09-2016
• Court: TRIBUNAL
• Department Lawyers: SUMAN MALIK
• Assessee Lawyers: P MURALI MOHAN RAO
• Section: 194C; 201(1)

Judgement Text

THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH A, HYDERABAD BEFORE SMT P. MADHAVI DEVI, JUDICIAL MEMBER AND B. RAMAKOTAIAH, ACCOUNTANT MEMBER ITA NO. 1201/HYD/2016 ASSESSMENT YEAR: 2010-11 ASST. COMMISSIONER OF INCOME TAX, CIRCLE-16(1) HYDERABAD. VS. M/S LANCO AMARKANTAK POWER LTD., HYDERABAD. PAN AACCK0633Q (APPELLANT) (RESPONDENT) REVENUE BY : SMT. SUMAN MALIK ASSESSEE BY : SHRI P. MURALI MOHAN RAO DATE OF HEARING : 19-04-2017 DATE OF PRONOUNCEMENT : 26-04-2017 ORDER PER B. RAMAKOTAIAH, AM THIS IS AN APPEAL BY REVENUE AGAINST THE ORDER OF CIT(A)-4, HYDERABAD DATED 23-06-2016. THE ONLY ISSUE AGITATED BY REVENUE IS WITH REFERENCE TO DISALLOWANCE MADE U/S 40(A)(IA) OF THE IT ACT IN RESPECT OF PAYMENTS ON WHICH TDS WAS MADE BUT WAS NOT PAID ON DUE DATE FOR PAYMENT. 2. BRIEFLY STATED, IN THE SCRUTINY ASSESSMENT MADE BY A.O, IT WAS NOTICED THAT ASSESSEE HAS DEDUCTED TAX BUT PAID AMOUNTS AFTER THE DUE DATE, AS LISTED OUT IN THE ORDER AS UNDER: 2 ITA NO. 1201/HYD/2016 M/S. LANCO AMARKANTAK POWER LTD., HYDERABAD SL. NO SECTION PAYMENT MADE TAX DEDUCTED AT SOURCE DUE DATE FOR PAYMENT ACTUAL DATE OF PAYMENT 1 194C 1,23,62,200 2,47,244 07.02.2010 23.04.2010 2 194J 4,84,680 48,468 07.02.2010 07.04.2010 3 194J 43,58,160 4,35,816 07.02.2010 23.04.2010 TOTAL 1,72,05,040 2.1. REFERRING TO THE PROVISIONS OF SEC. 40(A)(IA) OF THE IT ACT AS AMENDED BY FINANCE ACT W.E.F 2008, A.O WAS OF THE VIEW THAT SINCE THE ABOVE AMOUNTS WERE NOT PAID ON THE DUE DATE, THE AMOUNTS WERE NOT ALLOWABLE U/S 40(A)(IA) OF THE IT ACT. ACCORDINGLY A.O DISALLOWED THE AMOUNTS AND BROUGHT TO TAX. 3. BEFORE LD. CIT(A) IT WAS SUBMITTED THAT AS PER THE AMENDED SEC. 40(A)(IA) OF THE ACT MADE BY THE FINANCE ACT W.E.F 01-04-2010, THE TDS WAS PAID ON OR BEFORE DUE DATE FOR FILING THE RETURN OF INCOME U/S 139(1) OF THE IT ACT AND HENCE THE AMOUNT WAS NOT TO BE DISALLOWED. ASSESSEE RELIED ON THE CASE OF AYUSHAKTI AYURVED PVT. LTD. VS. ACIT (2010) 4 ITR (TRI) 537 (MUM) IN SUPPORT OF ITS CLAIM. FURTHER, IT WAS SUBMITTED THAT IN VIEW OF THE AMENDMENT, SINCE THE PAYMENT WAS MADE BEFORE THE DUE DATE OF FILING THE RETURN, THE ADDITION IS NOT SUSTAINABLE. ASSESSEE RELIED ON VARIOUS CASE LAW AS LISTED OUT BY CIT(A) IN PARA 5.2 OF THE ORDER. IT WAS FURTHER SUBMITTED THAT THE PROCEEDINGS U/S 201(1) OF THE IT ACT HAVE NOT BEEN INITIATED AND 3 ITA NO. 1201/HYD/2016 M/S. LANCO AMARKANTAK POWER LTD., HYDERABAD ACCORDINGLY AS PER THE EXISTING PROVISIONS OF SEC. 40(A)(IA) OF THE IT ACT, THE DISALLOWANCE WAS NOT WARRANTED. ASSESSEE RELIED ON THE DECISION OF DCIT VS M/S VISU INTERNATIONAL LTD., ITA NO. 488 & 621/HYD/2013 FOR THE ABOVE PROPOSITION. 3.1. LD. CIT(A) HOWEVER, GAVE RELIEF INVOKING THE PRINCIPLES LAID DOWN BY SPECIAL BENCH OF ITAT IN THE CASE OF MERILYN SHIPPING & TRANSPORTS, VISAKHAPATNAM VS ACIT. THE ORDER OF CIT(A) IS AS UNDER: 5.3 I HAVE CAREFULLY CONSIDERED THE ASSESSMENT ORDER AND THE SUBMISSIONS OF THE APPELLANT. IT IS OBSERVED THAT THE ASSESSING OFFICER DISALLOWED AN AMOUNT OF RS. 1,72,05,040/- ON THE BASIS THAT THE APPELLANT AFTER DEDUCING THE TAXES HAS NOT REMITTED THE SAME TO THE GOVERNMENT ACCOUNT WITHIN THE DUE DATE STIPULATED IN SECTION 40(A)(IA) OF THE ACT. AFTER GOING THROUGH THE SUBMISSIONS OF THE APPELLANT, THE ASSESSING OFFICER IS DIRECTED TO FOLLOW THE DECISION OF HONBLE ITAT IN THE CASE OF MERILYN SHIPPING & TRANSPORTS, VISAKHAPATNAM VS. ADDL.CIT, R-1, VISAKHAPATNAM. THUS, THE RELEVANT GROUND IS PARTLY ALLOWED. 3.2. REVENUE IS AGGRIEVED. 4. AFTER CONSIDERING THE RIVAL CONTENTIONS AND PERUSING THE ORDERS OF THE AUTHORITIES, WE DID NOT SEE ANY REASON TO INTERFERE WITH THE ORDER OF CIT(A), EVEN THOUGH ORDER OF CIT(A) IS ON A DIFFERENT ISSUE. IN THE PRESENT CASE THE FACTS INDICATE THAT ASSESSEE HAS MADE TDS ON THE AMOUNT PAID AND THESE WERE REMITTED IN APRIL 2010 ITSELF. AS PER THE AMENDED PROVISIONS OF SEC. 40(A)(IA) OF THE IT ACT W.E.F 01-04-2010 AS APPLICABLE FOR THE IMPUGNED ASSESSMENT YEAR, ANY AMOUNT OF TDS PAID ON OR BEFORE THE 4 ITA NO. 1201/HYD/2016 M/S. LANCO AMARKANTAK POWER LTD., HYDERABAD DUE DATE FOR FILING RETURN OF INCOME ARE NOT TO BE DISALLOWED U/S 40(A)(IA) OF THE IT ACT. SINCE, A.O HIMSELF HAS CERTIFIED THAT THE AMOUNTS WERE PAID IN APRIL 2010,IE. BEFORE THE DUE DATE OF FILING THE RETURN BEING 30-09-2010, A.O SHOULD NOT HAVE DISALLOWED THE AMOUNTS IN THE FIRST INSTANCE. ON THAT FACT, THE DISALLOWANCE MADE U/S 40(A)(IA) OF THE IT ACT CANNOT BE UPHELD. CONSEQUENTLY, THERE IS NO MERIT IN THE REVENUE APPEAL. 5. IN THE RESULT, APPEAL FILED BY REVENUE IS DISMISSED. PRONOUNCED IN THE OPEN COURT ON 26 TH APRIL, 2017. SD/- SD/- (P. MADHAVI DEVI) (B. RAMAKOTAIAH) JUDICIAL MEMBER ACCOUNTANT MEMBER HYDERABAD, DATED: 26 TH APRIL, 2017. KRK 1) M/S LANCO AMARKANTAK POWER LTD, LANCO HOUSE, PLOT NO. 04, SOFTWARE UNITS LAYOUT, HITECH CITY, MADHAPUR, HYDERABAD-500 081 2) ACIT, CIRCLE-16(1), HYDERABAD. 3) CIT(A) -4, HYDERABAD 4) PR.CIT-4, HYDERABAD 5) THE DEPARTMENTAL REPRESENTATIVE, I.T.A.T., HYDERABAD. 6) GUARD FILE