P.K.Rajasekar, CHENNAI V. ITO, CHENNAI

ITA 121/CHNY/2016

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 8589 (ITAT-CHENNAI)
• Duration Of Justice: 7 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-09-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2011-2012
• Appeal Filed On: 22-01-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SHIVA SRINIVASJCIT
• Assessee Lawyers: M KARUNAKARAN
• Keywords: Recovery proceedings; Onus to prove

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, CHENNAI . . . , .. ' #$, & '( BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI D.S. SUNDER SINGH, ACCOUNTANT MEMBER ./ ITA NO.121/MDS/2016 * +* / ASSESSMENT YEAR : 2011-12 SHRI P.K. RAJASEKAR, PLOT NO.70, NO.12, 4 TH CROSS STREET, RAMAKRISHNAN NAGAR, ERNAVOOR, CHENNAI - 600 057. PAN : ADVPR 4415 J V. THE INCOME TAX OFFICER, NON CORPORATE WARD 6(1), CHENNAI. (-./ APPELLANT) (/0-./ RESPONDENT) -. 1 2 / APPELLANT BY : SHRI M. KARUNAKARAN, ADVOCATE /0-. 1 2 / RESPONDENT BY : SHRI SHIVA SRINIVAS, JCIT ' 1 3& / DATE OF HEARING : 25.07.2016 45+ 1 3& / DATE OF PRONOUNCEMENT : 15.09.2016 / O R D E R PER N.R.S. GANESAN, JUDICIAL MEMBER: THIS APPEAL OF THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) 5, CHENN AI, DATED 15.12.2015 AND PERTAINS TO ASSESSMENT YEAR 2011-12. 2. SHRI M. KARUNAKARAN, THE LD.COUNSEL FOR THE ASSE SSEE, SUBMITTED THAT THE ASSESSEE IS ENGAGED IN THE BUSIN ESS OF LAYING 2 I.T.A. NO.121/MDS/16 CABLES. DURING THE YEAR UNDER CONSIDERATION, THE A SSESSEE HAS RECEIVED A SUM OF ` 64,85,397/- FROM M/S TULIP TELECOM P. LTD. THE ASSESSEE HAS OFFERED THE ABOVE SAID SUM OF ` 64,85,397/- FOR TAXATION. HOWEVER, WHILE FILING THE TDS RETURN, M/ S TULIP TELECOM P. LTD. APPEARS TO HAVE CLAIMED A SUM OF ` 1,26,84,856/- PAID TO THE ASSESSEE. OUT OF THE SO-CALLED CLAIM OF M/S TULIP TELECOM P. LTD., A SUM OF ` 58,36,556/- WAS SAID TO BE GIVEN CREDIT ON 01.07.20 10 IS TOTALLY INCORRECT. WHEN THE ASSESSEE CONTACTED THE COMPANY M/S TULIP TELECOM P. LTD., THEY SAID THEY WILL RECTIFY THE TDS RETURN FILED ELECTRONICALLY. HOWEVER, THEY HAVE NOT RECTIFIED. SINCE THE AMOUNT WAS NOT PAID, ACCORDING TO THE LD. COUNSEL, THE SAM E CANNOT BE TAKEN AS INCOME OF THE ASSESSEE. ACCORDING TO THE LD. COUNSEL, A WRONG ENTRY FILED BY THE DEDUCTOR CANNOT BE A REASO N TO TREAT THE SAME AS INCOME OF THE ASSESSEE. 3. ON THE CONTRARY, SHRI SHIVA SRINIVAS, THE LD. DE PARTMENTAL REPRESENTATIVE, SUBMITTED THAT THE ASSESSEE CLAIMED THAT THE CREDIT OF ` 58,36,556/- GIVEN ON 01.07.2010 IS A WRONG ENTRY AN D M/S TULIP TELECOM P. LTD. HAS NOT FILED REVISED TDS RETURN SO FAR. AS PER THE DETAILS FOUND IN FORM 26AS, THE ASSESSEE HAS RECEIV ED A SUM OF ` 1,23,19,906/- FROM M/S TULIP TELECOM P. LTD. IN VI EW OF THE CLAIM 3 I.T.A. NO.121/MDS/16 OF THE ASSESSEE, A LETTER WAS ADDRESSED TO M/S TULI P TELECOM P. LTD. BY THE ASSESSING OFFICER ON 6.12.2013. HOWEVE R, THE ASSESSING OFFICER HAS NOT RECEIVED ANY REPLY. THE ASSESSEE GAVE ANOTHER ADDRESS OF M/S TULIP TELECOM PVT. LTD. AT B ANGALORE. THE ASSESSING OFFICER HAS ALSO ADDRESSED A LETTER TO BA NGALORE ADDRESS. INSPITE OF THAT, NO REPLY WAS RECEIVED FROM M/S TUL IP TELECOM P. LTD. SINCE M/S TULIP TELECOM P. LTD. COULD NOT BE CONTAC TED, ACCORDING TO THE LD. D.R., THE ASSESSING OFFICER HAS NO OTHER ALTERNATIVE EXCEPT TO TAKE THE PARTICULARS CONTAINED IN FORM 26 AS AS CORRECT. THEREFORE, ACCORDING TO THE LD. D.R., THE CIT(APPEA LS) HAS RIGHTLY CONFIRMED THE ORDER OF THE ASSESSING OFFICER. 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITH ER SIDE AND PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. THE ASSESSEE CLAIMS THAT THE CREDIT OF ` 58,36,556/- SAID TO BE GIVEN ON 01.07.2010 IS A WRONG ENTRY AND THE COMPANY, NAMELY, M/S TULIP TELECOM P. LTD. FAILED TO RECTIFY THE TDS RETURN FILED ELECTRO NICALLY. THE REVENUE CLAIMS THAT THE LETTER ADDRESSED TO M/S TUL IP TELECOM P. LTD. WAS NOT RESPONDED. THEREFORE, THE ASSESSING O FFICER FOUND THAT THE ASSESSEE HAS NOT ESTABLISHED THE CLAIM. A CCORDINGLY, THE ASSESSING OFFICER TREATED THE PARTICULARS CONTAINED IN FORM 26AS AS 4 I.T.A. NO.121/MDS/16 GENUINE AND THE DIFFERENCE OF ` 61,99,459/-, AS PER THE CREDIT SHOWN IN FORM 26AS, WAS TAKEN AS UNDISCLOSED RECEIPT BY T HE ASSESSEE. THE MAIN GRIEVANCE OF THE ASSESSEE IS THAT THE CRED IT ENTRY FOUND ON 01.07.2010 TO THE EXTENT OF ` 58,36,556/- IS A WRONG ENTRY. 5. UNDER THE SCHEME OF INCOME-TAX ACT, THE ASSESSEE IS EXPECTED TO PAY TAX AFTER COMPLETION OF ASSESSMENT. IN ORDER TO ENSURE THE RECOVERY OF TAX, THE INCOME-TAX ACT PROV IDES PAYMENT OF TAX IN ADVANCE, BEFORE COMPLETION OF ASSESSMENT AND ALSO PROVIDES FOR DEDUCTION OF TAX AT SOURCE. WHEN THE PAYER DED UCTED THE TAX AS PER THE SCHEME OF THE INCOME-TAX ACT IN RESPECT OF THE PAYMENT MADE BY THEM, THE AMOUNT DEDUCTED BY THE PAYER TOWA RDS TDS HAS TO BE TREATED AS PAYMENT OF TAX. IF THE ASSESSEE C LAIMS THAT THERE WAS WRONG ENTRY AND WRONG CREDIT, THE ASSESSING OFF ICER HAS TO EXAMINE THE SAME WITH OPEN MIND AND FIND OUT WHETHE R THERE WAS A GENUINE CREDIT AS FOUND IN FORM 26AS. M/S TULIP TE LECOM P. LTD. IS ALSO A TAX PAYER IN THIS COUNTRY. THEREFORE, THE R EVENUE CANNOT SHIFT THE BURDEN TO THE ASSESSEE ON THE GROUND THAT M/S TULIP TELECOM P. LTD. COULD NOT BE CONTACTED. M/S TULIP TELECOM P. LTD. IS A COMPANY REGISTERED UNDER THE PROVISIONS OF COM PANIES ACT AND 5 I.T.A. NO.121/MDS/16 THE DIRECTORS CAN VERY WELL BE CONTACTED BY THE ASS ESSING OFFICER AND FIND OUT WHAT IS THE ERROR IN TDS RETURN. 6. THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT EVEN THOUGH THE BURDEN OF PROOF IS INITIALLY ON THE SHOULDER OF THE ASSESSEE, THE ASSESSING OFFICER IS ALSO EQUALLY RESPONSIBLE TO FI ND OUT WHETHER THE CREDIT ENTRY FOUND ON 01.07.2010 IS GENUINE OR NOT. THE ASSESSING OFFICER CANNOT TAKE ADVANTAGE OF THE IGNORANCE OR H ANDICAP OF THE ASSESSEE AND SAY THAT THERE WAS UNDISCLOSED RECEIPT BY THE ASSESSEE. WHEN THE ASSESSEE CLAIMS THAT THE ENTRY AS ON 01.07.2010 IS A WRONG ENTRY, THE ASSESSING OFFICER IN ALL FAIRNESS HAS TO EXAMINE THE SAME AND FIND OUT WHETHER THERE WAS GENUINE ENTRY OR NOT. THE ASSESSING OFFICER WAS CONFERRED THE POWER OF CIVIL COURT TO EXAMINE AND FIND OUT THE REAL NATURE OF TR ANSACTION. IF THE ASSESSING OFFICER COULD NOT EXERCISE THE POWER CONF ERRED ON HIM, IT IS NOT KNOWN HOW THE INDIVIDUAL CITIZEN OF THIS COU NTRY WILL BE ABLE TO FIND OUT THE GENUINENESS OF THE TRANSACTION. THERE FORE, IN ORDER TO MEET THE ENDS OF JUSTICE, THIS TRIBUNAL IS OF THE C ONSIDERED OPINION THAT THE ASSESSING OFFICER HAS TO FIND OUT THE ADDR ESS OF M/S TULIP TELECOM P. LTD. AND ITS DIRECTORS AND THEREAFTER FI ND OUT WHETHER SO- CALLED CREDIT OF ` 58,36,556/- SAID TO BE GIVEN ON 01.07.2010 IS A 6 I.T.A. NO.121/MDS/16 GENUINE TRANSACTION OR IT IS A WRONG ENTRY. THEREA FTER, THE ASSESSING OFFICER HAS TO DECIDE THE SAME IN ACCORDA NCE WITH LAW. ACCORDINGLY, THE ORDERS OF THE AUTHORITIES BELOW AR E SET ASIDE AND THE ENTIRE ISSUE IS REMITTED BACK TO THE FILE OF TH E ASSESSING OFFICER. THE ASSESSING OFFICER SHALL RE-EXAMINE THE MATTER A FRESH IN THE LIGHT OF THE MATERIAL AVAILABLE ON RECORD AND THEREAFTER DECIDE THE SAME IN ACCORDANCE WITH LAW AFTER GIVING A REASONABLE OP PORTUNITY TO THE ASSESSEE. 7. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED ON 15 TH SEPTEMBER, 2016 AT CHENNAI. SD/- SD/- ( . . ' #$ ) ( . . . ) (D.S. SUNDER SINGH) (N.R.S. GANESAN) & / ACCOUNTANT MEMBER /JUDICIAL MEMBER /CHENNAI, 7 /DATED, THE 15 TH SEPTEMBER, 2016. KRI. 1 /3#8 98+3 /COPY TO: 1. -. /APPELLANT 2. /0-. /RESPONDENT 3. ' :3 () /CIT(A)-5, CHENNAI 4. PRINCIPAL CIT-9, CHENNAI 5. 8; /3 /DR 6. * < /GF.