ACIT, Circle - 46, Kolkata, Kolkata V. Shri Matiyar Rahaman Mallick, Howrah

ITA 1594/KOL/2011

• Counselvise Citation: [2013] 140 COUNSELVISE.COM (IT) 70426 (ITAT-KOLKATA)
• Duration Of Justice: 2 year(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-12-2013
• Appeal Filed By: Department
• Bench Allotted: C
• Assessment Year: 2008-2009
• Appeal Filed On: 22-11-2011
• Court: TRIBUNAL
• Department Lawyers: A P ROY
• Section: 143(3); 194C

Judgement Text

, C , IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH: KOL KATA () BEFORE , /AND . . . . ' '' ''# '#'# '#, $% ) [BEFORE SHRI MAHAVIR SINGH, JM & SHRI ABRAHAM P. GEORGE, AM] & & & & / I.T.A NO. 1594/KOL/2011 '( )* '( )* '( )* '( )*/ // / ASSESSMENT YEAR: 2008-09 ASSISTANT COMMISSIONER OF INCOME-TAX, VS. SRI MAT IYAR RAHAMAN MALICK CIRCLE-46, KOLKATA. (PAN: AIYPM1358F) (,- /APPELLANT ) (./,-/ RESPONDENT ) DATE OF HEARING: 10.12.2013 DATE OF PRONOUNCEMENT: 10.12.2013 FOR THE APPELLANT: SHRI A. P. ROY, SR. DR FOR THE RESPONDENT: SHRI SOMNATH GHOSH, ADVOCATE $0 / ORDER PER SHRI MAHAVIR SINGH, JM: THIS APPEAL BY REVENUE IS ARISING OUT OF ORDER OF C IT(A)-XXX, KOLKATA IN APPEAL NO. 388/CIT(A)-XXX/CIRCLE-46/2010-11 DATED 29.08.2011. ASSESSMENT WAS FRAMED BY ACIT, CIRCLE-46, KOLKATA U/S. 143(3) OF THE INCOME-TAX AC T, 1961 (HEREINAFTER REFERRED TO AS THE ACT) FOR ASSESSMENT YEAR 2008-09 VIDE HIS ORDER DA TED 28.12.2010. 2. THE ONLY ISSUE IN THIS APPEAL OF REVENUE IS AGAI NST THE ORDER OF CIT(A) DELETING THE DISALLOWANCE MADE BY AO FOR AN AMOUNT OF RS.1,35,51 ,127/- BY INVOKING THE PROVISIONS OF SECTION 40A(IA) OF THE ACT FOR NON-DEDUCTION OF TDS FROM LABOUR PAYMENTS IN VIEW OF THE PROVISIONS OF SECTION 194C OF THE ACT. FOR THIS, R EVENUE HAS RAISED FOLLOWING TWO GROUNDS: 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. CIT(A)-XXX, KOLKATA ERRED IN DELETING THE ADDITION OF RS.1,35,51,127/- MADE U/S. 40A(IA) OF THE I. T. ACT FOR PAYMENT TO LABOURERS WITHOUT DEDUCTING TDS. 4. ON THE FACTS AND CIRCUMSTANCES OF THIS CASE LD. CIT(A) ERRED IN APPRECIATING THE FACT THAT NO RECORDS WERE PRODUCED BEFORE AO IN SUPPORT OF THE EXPENSES CLAIMED BY ASSESSEE BEFORE DELETING ADDITION U/S. 40A(IA). 3. WE HAVE HEARD RIVAL SUBMISSIONS AND GONE THROUGH FACTS AND CIRCUMSTANCES OF THE CASE. BRIEFLY STATED FACTS ARE THAT ASSESSEE IS A RENOWNE D CONTRACTOR OF JARI EMBROIDERY WORKS, WHICH HE HAS DONE THROUGH CONTRACT LABOUR AFTER RECEIVING JOB WORK FROM SEVERAL CUSTOMERS OR 2 ITA NO. 1594/K/2011 SHR MATIYAR RAHAMAN MALLICK, AY:2008-09 RETAIL/WHOLESALE TRADER OF JARI FABRICATED SAREES. THE AO DURING THE COURSE OF ASSESSMENT PROCEEDINGS NOTICED THAT THE ASSESSEE HAD PAID LABO UR CHARGES OF RS.1,35,51,127/- AND NO TDS IS DEDUCTED U/S. 194C OF THE ACT. IN VIEW OF THE A BOVE, THE AO NOTED THAT HE HAS VIOLATED THE PROVISIONS OF SECTION 194C OF THE ACT. HENCE, HE M ADE DISALLOWANCE OF THE ABOVE LABOUR EXPENSES BY INVOKING THE PROVISIONS OF SECTION 40A( IA) OF THE ACT. AGGRIEVED, ASSESSEE PREFERRED APPEAL BEFORE CIT(A), WHO DELETED THE DIS ALLOWANCE. AGGRIEVED, REVENUE CAME IN APPEAL BEFORE US. 4. BEFORE US LD. COUNSEL FOR THE ASSESSEE MADE HIS ARGUMENT THAT THE ASSESSEES PAYMENTS TO LABOURERS FOR THE ENTIRE YEAR IS BELOW RS.50,000 /-. THIS FACT WAS ADMITTED BY REVENUE AND LD. COUNSEL FOR THE ASSESSEE HAS ALSO FILED COMPLET E DETAILS IN HIS PAPER BOOK AT PAGES 8 TO 24. LD. COUNSEL FOR THE ASSESSEE DREW OUR ATTENTION TO THE PROVISO TO SECTION 194C(5), WHICH READS AS UNDER: PROVIDED THAT WHERE THE AGGREGATE OF THE AMOUNTS O F SUCH SUMS CREDITED OR PAID OR LIKELY TO BE CREDITED OR PAID DURING THE FINANCIAL YEAR EXCEEDS (FIFTY) THOUSAND RUPEES, THE PERSON RESPONSIBLE FOR PAYING SUCH SUMS REFERRED TO IN SUB-SECTION(1) SHALL BE LIABLE TO DEDUCT INCOME-TAX UNDER THIS SECTION. WHEN THE SAME WAS CONFRONTED TO LD. DR, HE FAIRLY C ONCEDED THE POSITION. WE FIND THAT THE PROVISIONS OF SECTION 194C PROVIDES FOR DEDUCTION O F TAX IN THE EXECUTION OF CONTRACT FOR AMOUNTS EXCEEDING RS.50000/- IN AGGREGATE IN A YEAR AND IN THE PRESENT CASE THE AMOUNT IS NOT EXCEEDING IN ANY OF THE LABOURERS PAYMENTS CASE AS PRESCRIBED IN THE PROVISION. ONCE THE AGGREGATE AMOUNT IS NOT EXCEEDING RS.50,000/- THE A SSESSEE IS NOT LIABLE TO DEDUCT TDS AND ONCE THE ASSESSEE IS NOT LIABLE TO DEDUCT TDS PROVI SIONS OF SECTION 40A(IA) OF THE ACT WILL NOT BE ATTRACTED AND DISALLOWANCE CANNOT BE MADE. APPEAL OF REVENUE IS DISMISSED. 5. IN THE RESULT, APPEAL OF REVENUE IS DISMISSED. 6. ORDER IS PRONOUNCED IN THE OPEN COURT. SD/- SD/- . . . . ' '' ''# '#'# '# , $% , (ABRAHAM P. GEORGE) (MAHAVIR SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 10TH DECEMBER, 2013 12 '3' 4 JD.(SR.P.S.) 3 ITA NO. 1594/K/2011 SHR MATIYAR RAHAMAN MALLICK, AY:2008-09 $0 5 . 6$ )7- COPY OF THE ORDER FORWARDED TO: 1 . ,- / APPELLANT ACIT, CIRCLE-46, KOLKATA 2 ./,- / RESPONDENT SHRI MATIYAR RAHAMAN MALLICK DHULAGO RI, KOLORAH MORE, HOWRAH SADAR, HOWRAH-711302. 3 . 0' ( )/ THE CIT(A), KOLKATA 4. 5. 0' / CIT KOLKATA <= .' / DR, KOLKATA BENCHES, KOLKATA / ./ TRUE COPY, $0'>/ BY ORDER, ' /ASSTT. REGISTRAR .