Shri Amiya Sachindranath Dey V, Vapi V. The Income tax Officer,Vapi Ward-1, Vapi

ITA 1371/AHD/2010

• Counselvise Citation: 137120514 RSA 2010
• Duration Of Justice: 2 year(s) 1 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-06-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2006-2007
• Appeal Filed On: 29-04-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Question of law
• Section: 194C

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD B BENCH AHMEDABAD BEFORE SHRI MUKUL KR. SHRAWAT , JUDICIAL MEMBER AND SHRI T.R. MEENA, ACCOUNTANT MEMBER ITA NO. 1371/AHD/2010 ASSESSMENT YEAR :2006-07 SHRI AMIYA SACHINDRANATH DEY V/S . ITO VAPI WARD-1, VAPI PAN NO. AG RPD4653K (APPELLANT) .. (RESPONDENT) BY APPELLANT SHRI TUSHAR P. HEMANI, A.R /BY RESPONDENT SHRI SAMIR TEKRIWAL, SR. D.R /DATE OF HEARING 13.06.2012 /DATE OF PRONOUNCEMENT 13.06.2012 O R D E R PER : T.R.MEENA, ACCOUNTANT MEMBER THIS IS AN APPEAL AT THE BEHEST OF THE ASSESSEE WHI CH HAS EMANATED FROM THE ORDER OF CIT(A)-VALSAD, ORDER DATED 25.11.2009 FOR ASSESSMENT YEAR 2006-07. 2. THE MAIN GROUND OF APPEAL IS TO CONSIDER THE DIS ALLOWANCE U/S 40(A)(IA) OF PAYMENT MADE TO SUB-CONTRACTORS AGGREGATING TO R S. 68,27,436/-. THE ASSESSEE IS A LABOUR CONTRACTOR OF BALAJI INDUSTRIE S, SILVASSA AND DONEAR IND. LTD. GROUP AT SILVASSA. ON RECEIPT OF THE CONTRACT FROM THE ABOVE PRINCIPLES, THE ASSESSEE HAS GIVEN SUB-CONTRACT TO FOLLOWING PE RSONS AND THE PAYMENT GIVEN TO THEM ARE AS UNDER:- ITA NO. 1371/AHD/2010 A.Y.2006-07 PAGE 2 SR. NO. NAME OF THE SUB-CONTRACTOR AMOUNT 1 ANOOP SINGH 1104338 2 C. SURESH 1380250 3 ANSHOOL ENTERPRISES 836133 4 JYOTI ENTERPRISES 1013534 5 ROHIT ENTERPRISES 834148 6 ONAM ENTERPRISES 665027 7 SHREE DURGA ENTERPRISES 944006 TOTAL RS. 68,27,436/- 3. THE ASSESSEES CASE WAS AUDITABLE IN A.Y.05-06. ACCORDINGLY, HE HAS TO DEDUCT TDS @ 1% ON SUB-CONTRACTOR BUT HE DID NOT DEDUCT THE TAX AT SOURCE WHICH WAS VIOLATION OF SECTION 194C(2) OF TH E IT ACT. THE A.O. DISALLOWED RS.68,27,436/- U/S 40(A)(IA) OF THE IT A CT. 4. THE CIT(A) HAS ALSO ENDORCED THE VIEW OF THE A.O . BEFORE HIM, THE ASSESSEE DID NOT MAKE ANY SUBMISSION TO DEFEND THE CASE AND NO EXPLANATION WAS OFFERED TO CONTROVERT THE FINDING OF THE A.O. THEREFORE, HE DISMISSED THE APPEAL OF THE ASSESSEE. 5. NOW THE ASSESSEE IS IN APPEAL BEFORE US AND HE A RGUED THAT RECENTLY HONBLE VISHAKHAPATNAM ITAT IN CASE OF MERILYN SHIP PING & TRANSPORT VS. ADDITIONAL CIT, RANGE-I, VISHAKHAPATNAM, 477 (VIZ.) 2008, SPECIAL BENCH HELD AS UNDER, WHETHER THE PROVISIONS OF SECTION 40 (A)(IA) ARE APPLICABLE ONLY TO AMOUNT OF EXPENDITURE WHICH ARE PAYABLE AS ON 31 ST MARCH OF EVERY YEAR AND IT CANNOT BE EVOKED TO DISALLOW THE EXPENDITURE WHICH HAVE BEEN ACTUALLY PAID DURING PREVIOUS YEAR WITHOUT DEDUCTION OF TDS HELD, YES ( IN FAVOUR OF THE ASSESSEE). AS THIS LEGAL ISSUE WAS NOT RAISED BEFORE LD. CIT(A), BY THE ASSESSEE, THE LD. D.R. FAIRLY ACCEPTED THE LEGAL PO SITION ON LEGAL GROUNDS RAISED BY THE LD. COUNSEL FOR THE ASSESSEE THAT HE CAN RAISE LEGAL GROUND IN ITA NO. 1371/AHD/2010 A.Y.2006-07 PAGE 3 HEARING OR BY REVISING GROUND OF APPEAL IN VIEW OF THE HONBLE SUPREME COURT DECISION IN CASE OF NTPC LTD. VS. CIT, 229 ITR 383 (SC) WHEREIN IT HAS BEEN HELD THAT QUESTION OF LAW AROSE WHICH BORE ON THE T AX LIABILITY OF THE ASSESSEE. THE TRIBUNAL HAS JURISDICTION TO EXAMINE THE SAME ( ALTHOUGH NOT RAISED BEFORE THE AUTHORITY). 6. THE LD. A.R. ALSO CONTENTED THAT THE PAYMENTS WE RE MADE PRINCIPAL TO PRINCIPAL NOT TO SUB-CONTRACTOR. ANOTHER SIDE, LD. D.R. REFERRED THE ORDER OF THE A.O. WHERE THE LD. A.O. HAS SPECIFICALLY MENTIONED PAYMENT TO THE SUB- CONTRACTOR COVERED U/S 194C OF THE IT ACT BUT THE D ETAILS OF THE AGREEMENT BETWEEN PRINCIPAL TO PRINCIPAL OR PRINCIPAL TO SUB- CONTRACTOR HAS NOT BEEN VERIFIED. THEREFORE, HE ARGUED TO RESTORE BACK BOT H THE ASPECT TO THE CIT(A). 7. WE HAVE CONSIDERED THE ORDER OF THE AUTHORITIES BELOW AND ARGUMENT FROM THE BOTH SIDES. RECENTLY ITAT, VISHAKHAPATNAM , IN ABOVE CASE HAS DEALT THE ISSUE OF AMOUNT PAID OR PAYABLE U/S 40(A) (IA) OF THE IT ACT. THEREFORE, THE CIT (A) IS DIRECTED TO DECIDE THE AP PEAL AFTER CONSIDERING THE ABOVE SPECIAL BENCH DECISION AND VERIFY THE NATURE OF PAYMENTS AND DECIDE THE MATTER AS PER LAW. 8. IN THE RESULT, THE ASSESSEES APPEAL IS ALLOWED FOR STATISTICAL PURPOSE. ORDER PRONOUNCED IN OPEN COURT ON THE DATE MENTIONE D HEREINABOVE AT CAPTION PAGE. SD/- SD/- ( MUKUL KR. SHRAWAT ) (T.R. MEENA) JUDICIAL MEMBER ACCOUNTANT MEMBER TRUE COPY S.K.SINHA ITA NO. 1371/AHD/2010 A.Y.2006-07 PAGE 4 ! ! ! ! '! '! '! '! / COPY OF ORDER FORWARDED TO:- 1. / APPELLANT 2. / RESPONDENT 3. '(' ) * / CONCERNED CIT 4. *- / CIT (A) 5. !./ ), ) , 12( / DR, ITAT, AHMEDABAD 6. /45 67 / GUARD FILE. BY ORDER/ , 8/ 1 ': ) , 12( ; STRENGTHEN PREPARATION & DELIVERY OF ORDERS IN THE ITAT 1) DATE OF TAKING DICTATION 13.06.2012 2) DIRECT DICTATION BY MEMBER STRAIGHT ON COMPUTER/LAPTOP/DRAGON DICTATE XXX 3) DATE OF TYPING & DRAFT ORDER PLACE BEFORE MEMBER 14.06.2012 4) DATE OF CORRECTION 14.06.2012 5) DATE OF FURTHER CORRECTION X 6) DATE OF INITIAL SIGN BY MEMBERS 15.06.2012 7) ORDER UPLOADED ON ,, ,, 8) ORIGINAL DICTATION PAD HAS BEEN ENCLOSED IN THIS FILE YES 9) FINAL ORDER AND 2 ND COPY SEND TO BENCH CLERK ON 15.06.2012