Income Tax Officer,(TDS) Ward-2(3), Hyderabad V. VLC-SCKC JV, Hyderabad

ITA 1376/Hyd/2019

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 2306 (ITAT-HYDERABAD)
• Duration Of Justice: 2 year(s) 1 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-10-2021
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: DB-B
• Next Hearing Date: 04-10-2021
• Assessment Year: 2012-2013
• Appeal Filed On: 05-09-2019
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Retrospective amendment; TDS
• Section: 201(1); 201; 40a(ia); 13; 139

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD B BENCH, HYDERABAD. BEFORE SHRI S.S. GODARA, JUDICIAL MEMBER AND SHRI L . P . SAHU, ACCOUNTANT MEMBER (THROUGH VIRTUAL HEARING) ITA NO. 1376 /HYD/20 19 & C.O. 29/HYD/2019 (ASSESSMENT YEAR : 20 12 - 13 ) INCOME TAX OFFICER (TDS), WARD 2(3), H YDERABAD. ..APPELLANT. VS. VLC SCKC JV, HYDERABAD. ..RESPONDENT /CROSS OBJECTOR . PAN AAAAV5354P DEPARTMENT BY : SHRI WASEEM UR REHMAN (D.R.) ASSESSEE/C.O. BY : SHRI MANOJ KUMAR JOHARI ( A .R.) DATE OF HEARING : 04.10.2 021. DATE OF PRONOUNCEMENT : 25 . 10 .2021. O R D E R PER SHRI S.S. GODARA, J.M. : THIS REVENUE S APPEAL AND ASSESSEE'S C.O. FOR ASST. YEAR 201 2 - 13 ARISES FROM THE COMMISSIONER OF INCOME TAX (APPEALS) - 4 , HYDERABAD S ORDER DT. 17.06.2019 PASSED IN CASE NO. 10166/18 - 19/ITO(TDS), WD - 2(3) / CIT(A) - 4 / HYD 2 ITA NO. 1376/HYD/2019 & C.O. 29/HYD/2019 /19 - 20 IN PROCEEDINGS UNDER SECTION 201(1A) OF INCOME TAX ACT, 1961 (THE ACT). HEARD BOTH THE PARTIES . C ASE FILE S PERUSED. 2. THE REVENUE PLEADS THE FOLLOWING SUBSTANTIVE GROUNDS IN THE INSTANT APPEAL : 1. THE CIT (APPEALS) ERRED IN NOT CONSIDERING THE CONDITIONS STIPULATED IN NOTIFICATION NO.11/2016 WHEN IT IS MA NDATORY FOR THE ASSESSEE TO ENSURE THAT THERE ARE NO DEMANDS AS ON THE DATE OF ASSESSMENT IN THE CASE OF THE DEDUCTEE AND THAT A RETURN OF INCOME HAS BEEN FILED VOLUNTARILY UNDER SEC.139 OF THE I T ACT, 1961 WHICH ARE CLEARLY SPECIFIED AT PARA 4.3 OF THE S AID NOTIFICATION; 2. THE CIT (APPEALS) ERRED IN PRINCIPLE IN CONSIDERING THE PAPER EVIDENCE FURNISHED BY THE DEDUCTOR, THAT THE DEDUCTEE HAD FILED THE RETURN OF INCOME UNDER SEC.139 AND THAT THERE ARE NO DEMANDS AS ON THE DATE OF ASSESSMENT AND WHEREAS AS PER THE NOTIFICATION NO.11/2016, IT IS MANDATORY FOR THE DEDUCTOR TO FILE FORM 26A IN 'ELECTRONIC MODE AND DIGITALLY SIGNED' AND ALSO IT IS MANADOTORY FOR THE DEDUCTOR TO ENSURE 'VALIDATION OF FORM 26A'. 3. THE CIT (APPEALS) OUGHT TO HAVE CONSIDERED THE F ACT THAT AS PER SUB - RULE 1 OF RULE 31ACB OF I T RULES, 1962, THE CERTIFICATE FROM AN ACCOUNTANT UNDER THE FIRST PROVISO TO SUB - SECTION (1) OF SEC. 201 SHALL BE FURNISHED IN FORM 26A TO THE PR.DGIT (SYSTEMS) AND AS PER SUB - RULE - 2, THE PR. DGIT (SYSTEMS) IS EMPOWERED TO AUTHORIZE AN 3 ITA NO. 1376/HYD/2019 & C.O. 29/HYD/2019 APPROPRIATE AUTHORITY TO RECEIVE FORM 26A. AS PER THIS DELEGATED POWERS OF PR. DGIT (SYSTEMS), THE CPC, TDS HAS BEEN AUTHORIZED TO RECEIVE SUCH FORMS IN ELECTRONIC MODE. THE CIT (APPEALS) OUGHT TO HAVE CONSIDERED THE FACT THAT WHE N THE CPC TDS HAS RECEIVED SUCH FORM 26A, THE QUESTION OF ARISING ANY DEMAND DOES NOT ARISE; 4. THE CIT(APPEALS) ERRED IN HOLDING THAT THERE IS CONTRADICTION IN FIRST PROVISO OF SEC.201(1) OF THE I T ACT, 1961 AND CBDT NOTIFICATION NO.11/2016 DATED 02 - 12 - 2016 WITH REFERENCE TO FORM 26A TO THE EFFECT THAT SUCH RESIDENT HAS PAID THE TAX DUE ON THE INCOME DECLARED BY HIM IN SUCH RETURN OF INCOME (AS PER CLAUSE - III OF FIRST PROVISO TO SUB - SEC.(1) OF SEC.201) AND IMPOSITION OF MANDATORY COMPLIANCE (AS PER 4.3 OF CBDT NOTIFICATION) ; 5. THE CIT (APPEALS) ERRED IN CONDONING THE VIOLATION OF PROCEDURE WHICH IS MANDATORY AS PER PR. DGIT (SYSTEMS), NEW DELHI AND IN GRANTING RELIEF TO THE DEDUCTOR. BY NOT FOLLOWING THE LAW THE DEDUCTOR HAS DELIBERATELY DISREGARDED THE MANDATORY DUTY WHICH HAS LED TO THIS MASSIVE PECUNIARY DEFAULT WHICH CANNOT BE EXEMPTED AS PER LAW. 3. BOTH THE PARTIES NEXT INVITED OUR ATTENTION TO THE CIT(A)S DETAILED DISCUSSION DECIDING THE FOREGOING SECTION 201(1) AND (1A) ISSUE IN ASS ESSEE'S FAVOUR AS UNDER : 4 ITA NO. 1376/HYD/2019 & C.O. 29/HYD/2019 ALLOWED. 4. LEARNED DEPARTMENT REPRESENTATIVE VEHEMENTLY CONTENDED DURING THE COURSE OF HEARING THAT THE CIT(A) HAS ERRED IN LAW AND ON FACTS IN DELETING THE IMPUGNED TDS RECOVERY DEMAND. THE ASSESSEE, ON THE OTHER HAND, HAS 5 ITA NO. 1376/HYD/2019 & C.O. 29/HYD/2019 ARGUED ON THE STRENGTH OF THE DETAILED PAPER BOOK RUNNING INTO 90 PAGES THAT THE CIT(A) HAS RIGHTLY GRANTED RELIEF IN ISSUE SINCE THE PAYEE HEREIN M/S. VIJAY MINING & INFRA CORPORATION PVT. LTD. HAD ALREADY FILED ITS CORRESPONDING RETURN, BALANCE SHEET, P & L ACCOUNT, NOTE TO FINANCIAL STATEMENTS AND LEDGER ACCOUNT (AS ON 31.3.2012) INDICATING IT THE LATTER TO HAVE DULY RECOGNIZED AND INCLUDED THE CORRESPONDING AMOUNT RECEIVED TO THE TUNE OF RS.79,52,43,245 AS TAXABLE INCOME. THE FACT, HOWEVER, REMAINS THAT NEITHER THE ASSESSING OFFICER NOR THE CIT(A) HAS VERIFIED THIS CRUCIAL FACTUAL POSITION IN THEIR RESPECTIVE ORDERS . WE, THEREFORE, QUOTE SECTION 201(1) FIRST PROVISO INSERTED IN THE ACT BY THE FINANCE ACT, 2012 W.E.F. 1.7.2012 STIPULATING THAT THE ASSESSEE CONCERNED SHALL NOT BE TREATED AS AN ASSESSEE IN DEFAULT PROVIDED THE PAYEE IN QUESTION DULY FURNISHE S ITS RE TURNS U/S. 139 TAKING INTO CONSIDERATION THE AMOUNT AS INCOME FOLLOWED BY PAYMENT OF TAXES THEREUPON ALONG WITH THE ACCOUNTANT CERTIFICATE TO THIS EFFECT AND DIRECT THE ASSESSING AUTHORITY TO VERIFY ALL 6 ITA NO. 1376/HYD/2019 & C.O. 29/HYD/2019 NECESSARY FACTS. WE FURTHER WISH TO MAKE TO CLEAR THA T THE HONBLE DELHI HIGH COURT IN CIT VS. ANSAL LANDMARK TOWNSHIPS (P) LTD (2015) 377 ITR 635 (DELHI) H AS ALREADY HELD HAVING CORRESPONDING SECOND PROVISO TO SECTION 40A(IA) AS CURATIVE IN NATURE WITH RETROSPECTIVE EFFECT. WE THEREFORE RESTORE THE INSTA NT ISSUE BACK TO THE ASSESSING OFFICER FOR HIS FRESH FACTUAL VERIFICATION TO THE FOREGOING LIMITED EXTENT IN VERY TERMS. 5. THIS REVENUES APPEAL ITA 1376/HYD/2019 AS WELL AS C.O. NO.29/HYD/2019 ARE ACCEPTED FOR STATISTICAL PURPOSES IN ABOVE TERMS. A COPY OF THIS COMMON ORDER BE PLACED IN THE RESPECTIVE CASE FILES. ORDER PRONOUNCED IN THE OPEN COURT ON 25TH OCT . , 2021. S D/ - SD/ - (L .P. SAHU) (S.S. GODARA) ACCOUNTANT MEMBER JUDICIAL MEMBER HYDERABAD, DT. 25 . 10 .2021. * REDDY GP 7 ITA NO. 1376/HYD/2019 & C.O. 29/HYD/2019 COPY TO : 1. M/S. VLC - SCKC JV, H.NO.8 - 2 - 686/K/27, KIMTEE ENCLAVE,ROAD NO.12, BANJARA HILLS, HYDERABAD - 500 034 2. ITO, WARD 2(3), HYDERABAD. 3. CIT (TDS)/ADDL. CIT (TDS), RANGE - 2, HYDERABAD / ACIT ( CPC), TDS, GHAZIABAD. 4. CIT(APPEALS) - 4, HYDERABAD. 5. DR, ITAT, HYDERABAD. 6. GUARD FILE. BY ORDER SR. PVT. SECRETARY, ITAT, HYDERABAD.