ACIT, Gurgaon V. Bharat Sanchar Nigam Ltd., Gurgaon

ITA 1579/DEL/2012

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 65789 (ITAT-DELHI)
• Duration Of Justice: 6 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-10-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 23-10-2012
• Assessment Year: 2006-2007
• Appeal Filed On: 04-04-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: PIRTHI LAL

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL DELHI DELHI DELHI DELHI BENCH BENCH BENCH BENCH A AA A : NEW DELHI : NEW DELHI : NEW DELHI : NEW DELHI BEFORE SHRI G. BEFORE SHRI G. BEFORE SHRI G. BEFORE SHRI G.D.AGRAWAL, D.AGRAWAL, D.AGRAWAL, D.AGRAWAL, VICE PRESIDENT AND VICE PRESIDENT AND VICE PRESIDENT AND VICE PRESIDENT AND SHRI SHRI SHRI SHRI HARI OM MARATHA HARI OM MARATHA HARI OM MARATHA HARI OM MARATHA, JUDICIAL MEMBER , JUDICIAL MEMBER , JUDICIAL MEMBER , JUDICIAL MEMBER ITA NO ITA NO ITA NO ITA NOS SS S. .. .1578/DEL/2012, 1579/DEL/2012 & 1580/DEL/2012 1578/DEL/2012, 1579/DEL/2012 & 1580/DEL/2012 1578/DEL/2012, 1579/DEL/2012 & 1580/DEL/2012 1578/DEL/2012, 1579/DEL/2012 & 1580/DEL/2012 ASSESSMENT YEAR ASSESSMENT YEAR ASSESSMENT YEAR ASSESSMENT YEARS SS S : : : : 2005 2005 2005 2005- -- -06, 2006 06, 2006 06, 2006 06, 2006- -- -07 & 2007 07 & 2007 07 & 2007 07 & 2007- -- -08 0808 08 A AA ASSISTANT COMMISSIONER OF SSISTANT COMMISSIONER OF SSISTANT COMMISSIONER OF SSISTANT COMMISSIONER OF INCOME TAX, INCOME TAX, INCOME TAX, INCOME TAX, TDS CIRCLE, TDS CIRCLE, TDS CIRCLE, TDS CIRCLE, GURGAON. GURGAON. GURGAON. GURGAON. VS. VS. VS. VS. M/S BHARAT SANCHAR NIGAM LIMITED, M/S BHARAT SANCHAR NIGAM LIMITED, M/S BHARAT SANCHAR NIGAM LIMITED, M/S BHARAT SANCHAR NIGAM LIMITED, MAIN TELECOM EXCHANGE, MAIN TELECOM EXCHANGE, MAIN TELECOM EXCHANGE, MAIN TELECOM EXCHANGE, OLD DELHI ROAD, OLD DELHI ROAD, OLD DELHI ROAD, OLD DELHI ROAD, GURGAON. GURGAON. GURGAON. GURGAON. PAN : AABCB5576G. PAN : AABCB5576G. PAN : AABCB5576G. PAN : AABCB5576G. (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI PIRTHI LAL, SR.DR. RESPONDENT BY : SHRI R.K.GUPTA, AR. ORDER ORDER ORDER ORDER PER G. PER G. PER G. PER G.D.AGRAWAL, D.AGRAWAL, D.AGRAWAL, D.AGRAWAL, VP VPVP VP : : : : THESE THREE APPEALS FILED BY THE REVENUE ARE DIREC TED AGAINST THE CONSOLIDATED ORDER OF LEARNED CIT(A), FARIDABAD DATED 25 TH JANUARY, 2012 FOR THE AY 2005-06, 2006-07 & 2007-08. 2. COMMON ISSUE IS RAISED IN ALL THESE APPEALS BY T HE REVENUE WHICH READ AS UNDER:- THE LD.COMMISSIONER OF INCOME TAX (A) HAS ERRED IN LAW AND ON THE FACTS IN DELETING THE DEMAND OF RS.46,72 ,608/- FOR A.Y. 2005-06, RS.40,04,520/- FOR A.Y. 2006-07 & RS.53,75,247/- FOR A.Y. 2007-08 VIDE HIS ORDER DATE D 25.01.2012 IN APPEAL NO.14/GGN/2011-12 MADE U/S 201 & 201(1A) OF THE INCOME TAX ACT FOR THE ASSESSMENT YE AR ITA NOS.1578 TO 1580/DEL/2012 2 2005-06 TO 2007-08 (FINANCIAL YEAR 2004-05 TO 2006- 07) HOLDING THAT:- 1. THE PRESENT CASE IS IDENTICAL AND SIMILAR TO THE ISSUE DECIDED BY CODS AND THE AMENDMENT MADE THROUGH THE FINANCE ACT, 2007 WHEREIN IT HAS BEEN PROVIDED THAT TAX SHALL NOT BE DEDUCTED ON PAYMENTS OF COMMISSION OR BROKERAGE PAYABLE BY BHARAT SANCHAR NIGAM LIMITED O R MAHANAGAR TELEPHONE NIGAM LIMITED TO THEIR PUBLIC C ALL OFFICE FRANCHISES. AS A MATTER OF FACT, THE CBDT H AS TAKEN A STAND THAT THE DEMANDS ARE NOT TO BE ENFORCED ON BSNL AND MTNL OFFICES EXPECTS IN THE CASES WHERE TAXES H AVE BEEN DEDUCTED AT SOURCES BUT NOT PAID OVER TO THE REVENUE. THE ORDER OF THE LD.CIT(A) IS NOT ACCEPTABLE AS THE AMENDMENT IN SECTION 194H BY WAY OF INSERTION OF PROVISION 3 IS NOT APPLICABLE RETROSPECTIVELY AND O NLY APPLICABLE AFTER 30 TH MAY, 2007. FURTHER, THE HONBLE HIGH COURT, CHANDIGARH HAS ALSO DECIDED THE APPEAL IN FA VOR OF THE ASSESSEE ON THE GROUND THAT THE MATTER HAS BEEN REFERRED TO THE COMMITTEE ON DISPUTES FOR AWARDING THE DECISION. HOWEVER, IN THE PRESENT ORDER A LIBERTY HAS BEEN GIVEN TO THE DEPARTMENT TO FILE APPROPRIATE APPLICA TION FOR REVIVAL OF THE APPEAL IF SUCH A NECESSITY ARISES ON THE BASIS OF THE DECISION TAKEN BY THE COMMITTEE ON DISPUTES. ONLY INSTANT ON THE INSTRUCTION OF CBDT ISSUED ON 08-05- 2009 VIDE INSTRUCTION NO.03/2009 ABOUT NOT FOR SEEN DEMAND/PENALTY AGAINST BSNL/MTNL FOR NON-DEDUCTION OF TDS ON STD/PCO COMMISSION IS NOT SUFFICIENT PARAMET ERS ABOUT RAISING OF DEMAND AND PASSING OF ORDER U/S 201(1)/201(1A) OF THE I.T.ACT. FURTHER, THE RELIAN CE OF DELHI ITAT DECISION IN ORDER NO.ITA/3946/D/2004 DATED 20- 10- 2005 IS NOT JUSTIFIED AS HONBLE CHANDIGARH HIGH CO URT HAS ALREADY DECIDED THIS ISSUE IN THE ASSESSEES OWN CA SE. 2. IT IS PRAYED THAT THE ORDER OF THE LD.COMMISSION ER OF INCOME TAX (APPEALS) BE CANCELLED AND THAT OF THE ASSESSING OFFICER MAY BE RESTORED. 3. THE APPELLANT CRAVES FOR THE PERMISSION TO ADD O R AMEND ANY GROUNDS OF APPEAL BEFORE THE APPEAL IS HE ARD OR DISPOSED OFF. 3. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE M ATERIAL PLACED BEFORE US. WE FIND THAT THIS ISSUE IS SQUARELY COV ERED IN FAVOUR OF THE ITA NOS.1578 TO 1580/DEL/2012 3 ASSESSEE BY THE DECISION OF ITAT IN ASSESSEES OWN CASE FOR AY 2003- 04 TO 2008-09 VIDE ITA NOS.193/DEL/2012 TO 198/DEL/ 2012, WHEREIN THE ITAT HELD AS UNDER:- 6. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIAL PLACED BEFORE US. WE FIND THAT THE ISSUE INVOLVED IN THE PRESENT APPEALS IS COVERED IN FAVOUR OF THE ASSESSEE BY THE ORDER OF THE TRIBUNAL DATED 7 TH DECEMBER, 2011 (SUPRA) PASSED IN ASSESSEES OWN CASE FOR AY 2006-0 7 & 2007-08. IN THE SAID ORDER, THE ITAT PUNE BENCH HA S FOLLOWED THE EARLIER ORDER OF THE TRIBUNAL IN ASSES SEES OWN CASE IN ITA NOS.71 TO 77/PN/2009 FOR THE AY 2002-03 AND 2008-09, AND HELD THAT THE AMENDMENT BROUGHT IN SEC TION 194H IS ONLY CLARIFICATION IN NATURE. THE RELEVANT PORTION OF THE SAID ORDER IS REPRODUCED BELOW :- 5. FROM THE ABOVE, IT IS EVIDENT THAT THE FINANCE ACT, 2007 HAS INCORPORATED THIRD PROVISO TO SECTION 194H STATING, NO DEDUCTION SHALL BE MADE UNDER THIS SEC TION OF ANY COMMISSION OR BROKERAGE PAYABLE BY BSNL OR MTNL TO THEIR PCO FRANCHISEES. THE SAME IS RELEVANT FOR TH E A.Y. 2008-09. THE ISSUE IS WHETHER SIMILAR EXEMPTION IS APPLICABLE FOR THE ASSESSMENT YEAR PRIOR TO THE ASS ESSMENT YEAR 2008-09. THIS ISSUE WAS ADJUDICATED IN FAVOUR OF THE ASSESSEE BY CO-ORDINATE BENCH OF THIS TRIBUNAL IN ASSESSEES OWN CASE IN ITA NO.71 TO 77/PN/2009. IT HAS TAKEN SUPPORT FROM THE ORDER OF THE TRIBUNAL IN THE CASE OF ITO VS. ACCOUNTS OFFICER, BSNL (ITA NO.3996/DEL/200 4). CONSIDERING THE EXACT NATURE OF THE ISSUE, WE ARE O F THE OPINION THAT THE CIT(A) WAS JUSTIFIED IN CANCELLING THE ORDERS OF THE A.O. U/S 201 AND 201(1A) FOR THE YEAR S UNDER CONSIDERATION. 7. RESPECTFULLY FOLLOWING THE AFORESAID ORDER OF TH E ITAT IN ASSESSEES OWN CASE, WE HOLD THAT THE AUTHORITIE S BELOW HAVE ERRED IN TREATING THE ASSESSEE IN DEFAULT UNDE R SECTION 201(1)( AND 201(1A). ACCORDINGLY, WE REVER SE THE ORDERS OF AUTHORITIES BELOW AND ALLOW THE APPEALS F ILED BY THE ASSESSEE. 4. SINCE THE ISSUE IN THE YEARS UNDER APPEAL IS IDE NTICAL TO THE ISSUE DECIDED BY THE ITAT IN THE EARLIER YEARS, WE, RESPE CTFULLY FOLLOWING THE ITA NOS.1578 TO 1580/DEL/2012 4 ABOVE DECISION OF THE ITAT, UPHOLD THE ORDER OF LEA RNED CIT(A) AND DISMISS THE APPEALS OF THE REVENUE. 5. IN THE RESULT, ALL THE APPEALS OF THE REVENUE AR E DISMISSED. DECISION PRONOUNCED IN THE OPEN COURT ON 26 TH OCTOBER, 2012. SD/- SD/- ( (( (HARI OM MARATHA HARI OM MARATHA HARI OM MARATHA HARI OM MARATHA) )) ) (G.D.AGRAWAL) (G.D.AGRAWAL) (G.D.AGRAWAL) (G.D.AGRAWAL) JUDICIAL JUDICIAL JUDICIAL JUDICIAL MEMBER MEMBER MEMBER MEMBER VICE PRESIDENT VICE PRESIDENT VICE PRESIDENT VICE PRESIDENT DATED : 26.10.2012 VK. COPY FORWARDED TO: - 1. APPELLANT : ASSISTANT COMMISSIONER OF INCOME TAX , ASSISTANT COMMISSIONER OF INCOME TAX, ASSISTANT COMMISSIONER OF INCOME TAX, ASSISTANT COMMISSIONER OF INCOME TAX, TDS CIRCLE, GURGAON. TDS CIRCLE, GURGAON. TDS CIRCLE, GURGAON. TDS CIRCLE, GURGAON. 2. RESPONDENT : M/S BHARAT SANCHAR NIGAM LIMITED, M/S BHARAT SANCHAR NIGAM LIMITED, M/S BHARAT SANCHAR NIGAM LIMITED, M/S BHARAT SANCHAR NIGAM LIMITED, MAIN TE MAIN TE MAIN TE MAIN TELECOM EXCHANGE, LECOM EXCHANGE, LECOM EXCHANGE, LECOM EXCHANGE, OLD DELHI ROAD, GURGAON. OLD DELHI ROAD, GURGAON. OLD DELHI ROAD, GURGAON. OLD DELHI ROAD, GURGAON. 3. CIT 4. CIT(A) 5. DR, ITAT ASSISTANT REGISTRAR