TIJARIA POLYPIPES LTD., Jaipur V. DCIT, Jaipur

ITA 14/JPR/2014

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 5278 (ITAT-JAIPUR)
• Duration Of Justice: 2 year(s) 4 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-05-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2012-2013
• Appeal Filed On: 06-01-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S K JAIN DCIT DHK

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES, JAIPUR JH DQY HKKJR] U;KF;D LNL; ,OA JH VH-VKJ-EHUK] YS[KK LNL; DS LE{K BEFORE: SHRI KUL BHARAT, JM & SHRI T.R.MEENA, AM VK;DJ VIHY LA -@ ITA NO. 14 & 22/JP/2014 FU/KZKJ.K O'K Z @ ASSESSMENT YEARS : 2012-13 & 2011-12. M/S TIJARIA POLYPIPES LTD., A-130(E), ROAD NO. 9, VKI, JAIPUR. CUKE VS. D.C.I.T., TDS, JAIPUR. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO. TAN-JPRT 01691 E VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY : SHRI MANISH AGARWAL (CA) JKTLO DH VKSJ LS@ REVENUE BY : SHRI S.K. JAIN, (DCIT) LQUOKBZ DH RKJH[K@ DATE OF HEARING : 24/04/2016. MN?KKS'K .KK DH RKJH[K @ DATE OF PRONOUNCEMENT : 30/05/2016. VKNS'K@ ORDER PER T.R. MEENA, A.M. THESE ARE THE APPEALS FILED BY THE REVENUE AGAINST T HE ORDER DATED 31/10/2013 PASSED BY THE LD. CIT(A)-III, JAIPUR FOR THE ASSESSMENT YEARS 2011-12 & 2012-13 WHEREIN THE REVENUE RAISED FOLLOWI NG GROUNDS IN A.Y. 2012-13. ITA NO. 14 & 22/JP/2014 M/S TIJARIA POLYPIPES LTD. VS DCIT 2 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE THE LD. CIT(A) HAS GROSSLY ERRED IN SUSTAINING THE ACTIO N OF THE LD. AO IN CREATING A DEMAND OF' 51,98,563/- (INCLUDING INTEREST) BY HOLDING THAT THE ASSESSEE I S LIABLE FOR MAKING TDS ON THE PAYMENT MADE TO RIICO AGAINST ALLOTMENT OF LAND AS LEASE CHARGE WITHOUT APPRECIATING THE NATURE OF PAYMENT, ARBITRARILY. 1.1 THAT THE LD. CIT(A) HAS FURTHER ERRED IN OBSERVIN G THAT THE AMOUNT PAID TO RIICO FOR ALLOTMENT OF LAND FALL S WITHIN THE PREVIEW OF THE PROVISIONS OF SECTION 194-I OF THE INCOME TAX ACT, 1961 AND HAS FAILED TO APPRECIAT E THE FACT THAT THE EXPENDITURE IS CAPITAL IN NATURE THUS SUCH OBSERVATION OF LD. CIT(A) DESERVES TO BE HOLD B AD IN LAW. 1.2 THAT THE LD. CIT(A) HAS FURTHER ERRED IN OBSERVIN G THAT RIICO IS NOT THE OWNER OF LAND AND ALLOWED THE USE O F LAND TO ASSESSEE ON BEHALF OF GOVERNMENT, IS AGAINS T THE OBJECTS OF RIICO WHO IS ESTABLISHED BY GOVERNMEN T TO SET UP AND DEVELOP INDUSTRIAL AREA FOR WHICH THE LAND IS ACQUIRED BY RIICO WHICH IN TURN ALLOTTED FOR INDU STRIAL PURPOSES THUS SUCH OBSERVATION BEING CONTRARY TO FA CTS DESERVES TO BE IGNORED AND EXCLUDED. 2. THAT THE LD. CIT(A) HAS ERRED IN SUSTAINING THE D EMAND OF TDS IN RESPECT OF PAYMENT OF CIPET, JAIPUR WITHOUT APPRECIATING THE FACT THAT THE DEDUCTEE HAS INCLUDE D THE TESTING CHARGES AS ITS INCOME IN ITS RETURN AND PAID THE DUE TAXES ON THE SAME, HENCE DEMAND OF TDS AND INTEREST ON SUCH PAYMENT DESERVES TO BE DELETED. 3. THAT THE LD. CIT(A) HAS ERRED IN SUSTAINING THE D EMAND OF TDS IN RESPECT OF PAYMENT MADE TO DIRECTOR, CENTR AL ARID ZONE RESEARCH INSTITUTE WITHOUT APPRECIATING TH E ITA NO. 14 & 22/JP/2014 M/S TIJARIA POLYPIPES LTD. VS DCIT 3 FACT THAT PAYMENT WAS MADE TOWARDS THE TESTING OF SAMPLES OF PRODUCTION CARRIED OUT BY THE ASSESSEE WHICH IS NOT OF TECHNICAL IN NATURE, THUS NOT LIABLE FOR TDS AND FURTHER IGNORED THE FACT THAT THE DEDUCTEE H AS INCLUDED THE TESTING CHARGES AS ITS INCOME IN ITS R ETURN AND PAID THE DUE TAXES ON THE SAME, HENCE DEMAND OF TDS AND INTEREST ON SUCH PAYMENT DESERVES TO BE DELETED. GROUND OF REVENUES APPEAL FOR A.Y. 2011-12 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E THE LD. CIT(A) HAS GROSSLY ERRED IN SUSTAINING THE ACTIO N OF THE LD. AO IN CREATING A DEMAND OF 51,98,563/- (INCLUDING INTEREST) BY HOLDING THAT THE ASSESSEE I S LIABLE FOR MAKING TDS ON THE PAYMENT MADE TO RIICO AGAINST ALLOTMENT OF LAND AS LEASE CHARGE WITHOUT APPRECIATING THE NATURE OF PAYMENT, ARBITRARILY. 1.1 THAT THE LD. CIT(A) HAS FURTHER ERRED IN OBSERVIN G THAT THE AMOUNT PAID TO RIICO FOR ALLOTMENT OF LAND FALL S WITHIN THE PREVIEW OF THE PROVISIONS OF SECTION 194-I OF THE INCOME TAX ACT, 1961 AND HAS FAILED TO APPRECIAT E THE FACT THAT THE EXPENDITURE IS CAPITAL IN NATURE THUS SUCH OBSERVATION OF LD. CIT(A) DESERVES TO BE HOLD B AD IN LAW. 1.2 THAT THE LD. CIT(A) HAS FURTHER ERRED IN OBSERVIN G THAT RIICO IS NOT THE OWNER OF LAND AND ALLOWED THE USE O F LAND TO ASSESSEE ON BEHALF OF GOVERNMENT, IS AGAINS T THE OBJECTS OF RIICO WHO IS ESTABLISHED BY GOVERNMEN T TO SET UP AND DEVELOP INDUSTRIAL AREA FOR WHICH THE LAND IS ACQUIRED BY RIICO WHICH IN TURN ALLOTTED FOR INDU STRIAL ITA NO. 14 & 22/JP/2014 M/S TIJARIA POLYPIPES LTD. VS DCIT 4 PURPOSES THUS SUCH OBSERVATION BEING CONTRARY TO FA CTS DESERVES TO BE IGNORED AND EXCLUDED. 2. IN BOTH THE CASES, THE LD AR OF THE ASSESSEE HAS SUBMITTED THAT THE ISSUE UNDER CONSIDERING IS COVERED BY THE ORDER OF THE HONBLE ITAT, JAIPUR BENCH, JAIPUR PASSED IN THE CASE OF M/S GUPT A FABTEX PVT. LTD. VS. DCIT (TDS) IN ITA NOS. 647 & 648/JP/2013 FOR A.Y. 200 1-12 & 2012-13 ORDER DATED 16/12/2015 WHEREIN THE HONBLE BENCH HAS BEEN PLEASED TO ALLOW THE ASSESSEES APPEAL IN BOTH THE YEARS. THEREF ORE, HE PRAYED TO REVERSE THE ORDER OF THE LD CIT(A) AND ALLOW THE ASSE SSEES APPEALS. 3. AT THE OUTSET, THE LD DR HAS VEHEMENTLY SUPPORTE D THE ORDER OF THE LOWER AUTHORITIES AND PRAYED TO CONFIRM THE ORDER OF THE LD CIT(A). 4. WE HAVE HEARD THE RIVAL CONTENTIONS OF BOTH THE PARTIES AND PERUSED THE MATERIAL AVAILABLE ON THE RECORD. THE ID ENTICAL ISSUE INVOLVED IN THIS APPEAL, HAS BEEN DECIDED BY THE COORDINATE BENCH IN THE CASE OF M/S GUPTA FABTEX PVT. LTD. VS. DCIT (TDS) IN ITA NOS. 647 & 648/JP/2013 FOR A.Y. 2001-12 & 2012-13 ORDER DATED 16/12/2015. AS THE FACTS AND CIRCUMSTANCES OF THE CASE ARE IDENTICAL T O THE CASE OF M/S GUPTA FABTEX PVT. LTD., THEREFORE, BY RESPECTFULLY FOLLOWI NG THE DECISION OF THE ITA NO. 14 & 22/JP/2014 M/S TIJARIA POLYPIPES LTD. VS DCIT 5 COORDINATE BENCH, WE REVERSE THE ORDER OF THE LD CI T(A) AND ALLOW THE ASSESSEES APPEALS FOR BOTH THE YEARS. 5. IN THE RESULT, BOTH THE APPEALS OF THE ASSESSEE ARE ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 30/05/2016. SD/- SD/- DQYHKKJR VH-VKJ-EHUK (KUL BHARAT) (T.R. MEENA) U;KF;D LNL;@ JUDICIAL MEMBER YS[KK LNL;@ ACCOUNTANT MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 30 TH MAY, 2016 RANJAN* VKNS'K DH IZFRFYFI VXZSFKR @ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ @ THE APPELLANT- M/S TIJARIA POLYPIPES LTD., JAIPUR. 2. IZR;FKHZ @ THE RESPONDENT- THE D.C.I.T., TDS, JAIPUR. 3. VK;DJ VK;QDR @ CIT 4. VK;DJ VK;QDRVIHY @ THE CIT(A) 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ @ DR, ITAT, JAIPUR 6. XKMZ QKBZY @ GUARD FILE (ITA NO. 11 & 22/JP/2014) VKNS'KKUQLKJ @ BY ORDER, LGK;D IATHDKJ @ ASST. REGISTRAR