Income Tax Officer, Ward-15(3), Hyderabad V. M/s. Vipanchi Chit Funds Pvt. Ltd., Flat No. 607, Hyderabad

ITA 1346/HYD/2013

• Counselvise Citation: 134622514 RSA 2013
• Duration Of Justice: 3 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-02-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2011-2012
• Appeal Filed On: 07-10-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ADAGIRI
• Assessee Lawyers: LAXMINIWAS SHAR MA

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH A', HYDERABAD BEFORE THE HONBLE VICE PRESIDENT, SHRI D.MANMOHAN AND SHRI B.RAMAKOTAIAH, HONBLE ACCOUNTANT MEMBER ITA NO. 1345 /HYD/2013 : ASST. YEAR 20 1 0 - 11 ITA NO. 134 6 /HYD/2013 : ASST. YEAR 20 1 1 - 1 2 INCOME TAX OFFICER WARD 15(3) , HYDERABAD. V/S. M/S. VIPANCHI CHIT FUNDS PVT. LTD., HYDERABAD ( PAN - AACCB 3837 H) (APPELLANT) (RESPONDENT) APPELLANT BY : S HRI B. Y ADAGIRI DR RESPONDENT BY : SHRI LAXMINIWAS SHARMA DATE OF HEARING 4 . 2 .201 4 DATE OF PRONOUNCEMENT 4 .2.2014 O R D E R PER D.MANMOHAN, VICE PRESIDENT: TH ESE TWO APPEALS ARE FI L E D BY THE R E VEN U E AND T H E Y ARE DI R ECTED AGAINST THE ORDERS PASSED BY THE COMMISSIONER OF INCOME - TAX (APPEALS) HYDERABAD DATED 23.7.2013. 2. WH E T H E R THE ASSESSEE IS LIABLE TO DEDUCT TAX AT SO U R CE IN THE WAKE OF THE FACT THAT IT HAS PAID DIVIDEND TO ITS SUBSCRIBERS , IS THE ISSUE THAT ARISES FOR CONSIDERATION IN TH E S E APPEAL S , AND ACCORDING TO THE R E V E NUE IT PARTAKES THE CHARACTER OF I N T ER E ST, W H E REAS ACCORDING TO THE ASSESSEE - COMPANY, IT IS ONLY DISBURSEMENT O F T HE EX CESS MONEY TO ITS MEMBERS FROM THE CONTRIBUT IONS MADE TO THEM AND IT CANNOT BE EQU A T ED TO I N T E REST. 3. AT THE TIME OF HEARING , LEARNED COUNSEL APPEARING ON BEHALF OF THE ASSESSEE SUBMITTED THAT THE ISSUES STANDS SQUARELY COVERED BY THE DECISION OF THE ITAT , B BENCH, HYDERABAD IN ASSESSEE S OWN CASE FOR THE ASSESSMENT YEARS 2005 - 06(ITA NOS.804/HYD/2011 ) , WH E REIN THE BENCH OBSERVED THAT THE PAYMENT O F DIVIDEND TO THE SUBSCRIBERS OF THE CHIT, DOES NOT PARTAKE THE CHARACTER OF I N T ER E ST, AND CONSEQUENTLY , THE ASSESSEE IS NOT LIABLE T O DEDUCT TAX ITA NO. 1345 - 4 6 / HYD/ 2013 M/S. VIPANCHI CHIT FUNDS PVT. LTD., HYDERABAD 2 AT SOURCE UN DER S.194 A OF THE A C T; AS A NATURAL COROLLARY , INTER E ST CANNOT B E CHARGED UNDER S.201/201(1A)OF THE AC T. 4 . LEARNED DEPARTMENTAL REPRESENTATIVE FAIRLY ACCEPTED THA T THE ISSUE STANDS FAIR LY COVERED BUT THE R E VENUE HAS N O T ACCEPTE D THE VIEW TAKEN BY THE ITAT. 5. WE HAVE CO N S IDERE D THE SUBM I S SIO N S A ND PERUSED THE RECORD. SI N C E THE VIEW TAKEN BY THE LEARNED COMMISSIONER OF IN COME - TAX(APPEALS) IS CO NSIST ENT WITH THE VIEW ALR E ADY TAKEN BY THE ITAT IN THE AFORESAID DECISION , WE DO NOT FIND ANY INFIRMITY IN T H E O R DERS PASSED BY THE LEARNED CIT . W E , THEREFORE , DISMISS THE APPEALS FI L E D BY THE R E VEN U E , AS ALREADY PRONOUNCED IN THE OPEN COURT. 6 . IN THE RESULT, REVENUES APPEAL S ARE DISMISSED. ORDER PRONOUNCED IN THE COURT ON 4 .2.2014 SD/ - SD/ - ( B.RAMAKOTAIAH ) (D.MANMOHAN) ACCOUNTANT MEMBER VICE PRESIDENT DT/ - 4 TH FEBRUARY 201 4 COPY FORWARDED TO: 1. M/S. VIPANCHI CHIT FUNDS PVT. LTD., FLAT NO.607, BABU KHAN ESTATE, BASHEERBAGH, HYDERABAD 2 . INCOME TAX OFFICER 15(3) , HYDERABAD 3 . 4 . COMMISSIONER OF INCOME - TAX(APPEALS) II , HYDERABAD COMMISSIONER OF INCOME - TAX I HYDERABAD 5 . DEPARTMENTAL REPRESENTATIVE, ITAT, HYDERABAD. B.V.S