M/S WORLD TRADE PARK LIMITED, JAIPUR V. ASSISTANT COMMISSIONER OF INCOME TAX (TDS), JAIPUR

ITA 167/JPR/2018

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 3650 (ITAT-JAIPUR)
• Duration Of Justice: 1 year(s) 2 month(s) 21 day(s)
• Appeal Type: Income Tax (International Taxation) Appeal
• Pronouncement Date: 29-04-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2013-2014
• Appeal Filed On: 07-02-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: J C KULHARI JCIT DHK
• Keywords: Period of limitation; Reasonable cause; TDS; Set aside
• Section: 273B; 201(1)

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHE S, JAIPUR JH FOT; IKY JKWO] U;KF;D LNL; ,OA JH FOE FLAG ;K NO ] YS[KK LNL; DS LE{K BEFORE: SHRI VIJAY PAL RAO, JM AND SHRI VIKRAM SING H YADAV, AM VK;DJ VIHY LA-@ ITA NO. 166, 167, 168 & 169/JP/2018 FU/KZKJ.K O'K Z@ ASSESSMENT YEAR : 2013-14 24Q1 TO 24Q4. M/S. WORLD TRADE PARK LTD., J.L.N. MARG, JAIPUR. CUKE VS. THE ACIT, (TDS), JAIPUR. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN NO. /TAN NO. JPRR 04161 D VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY : SHRI ASHISH SHARMA (ADVOCATE) JKTLO DH VKSJ LS@ REVENUE BY : SHRI J.C. KULHARI (JCIT) LQUOKBZ DH RKJH[K@ DATE OF HEARING : 19.06.2018. ?KKS'K .KK DH RKJH[K@ DATE OF PRONOUNCEMENT : 21/06/2018. VKNS'K@ ORDER PER BENCH : THESE FOUR APPEALS BY THE ASSESSEE ARE DIRECTED AGA INST FOUR SEPARATE ORDERS OF LD. CIT (A) ALL DATED 22 ND DECEMBER, 2017 ARISING FROM THE PENALTY ORDER PASS ED UNDER SECTION 271H OF THE IT ACT FOR THE ASSESSMENT YEAR 2012-13 Q1 TO Q4. THE ASSESSEE HAS RAISED COMMON GROUNDS IN THESE APPEALS . THE GROUND RAISED IN ITA NO. 166/JP/2018 ARE AS UNDER :- 1. THAT THE COMMISSIONER OF INCOME TAX (APPEALS)- III HAS GROSSLY ERRED IN SUSTAINING PENALTY OF RS. 10,000/-. 2. THAT THE COMMISSIONER OF INCOME TAX (APPEALS)-II I HAS GROSSLY ERRED IN UPHOLDING THE IMPOSITION OF PENALTY LEVIED U/S 271H AS JUSTIFIED. 2 ITA NOS. 166, 167, 168 & 169/JP/2018. M/S. WORLD TRADE PARK LIMITED, JAIPUR. 2. THE AO NOTED THAT THE ASSESSEE HAS FAILED TO FUR NISH/FILE THE QUARTERLY RETURNS OF TDS IN THE PRESCRIBED FORM 24Q FOR THE FINANCIAL YEAR 2012-13 AS REQUIRED UNDER SECTION 200(3) OF THE IT ACT. ACCORDINGLY THE AO I SSUED A SHOW CAUSE NOTICE UNDER SECTION 271H DATED 4 TH JUNE, 2015 FOR LEVY OF PENALTY FOR DEFAULT OF NON- SUBMITTING THE QUARTERLY TDS STATEMENT/RETURN. THE ASSESSEE C ONTENDED THAT THE ASSESSEE WAS FACING FINANCIAL DIFFICULTIES AND, THEREFORE, COULD NOT PAY THE TDS BY DUE DATES AFTER DEDUCTING THE TAX AT THE TIME OF CREDIT GIVEN TO TH E DEDUCTEE AND, THEREFORE, THE ASSESSEE PLEADED THAT THERE WAS A REASONABLE AND SU FFICIENT CAUSE FOR NOT SUBMITTING THE QUARTERLY TDS STATEMENT IN TIME. TH E AO DID NOT ACCEPT THE CONTENTION OF THE ASSESSEE AND OBSERVED THAT THE AS SESSEE COULD NOT FILE THE STATEMENT EVEN AFTER DEPOSITING THE TAX. HENCE THE AO LEVIED THE PENALTY OF RS. 20,000/- UNDER SECTION 271H FOR EACH QUARTER. THE ASSESSEE CHALLENGED THE ACTION OF THE AO BEFORE LD. CIT (A) AND REITERATED ITS CON TENTION THAT THERE WAS A REASONABLE CAUSE WHICH HAS PREVENTED THE ASSESSEE I N SUBMITTING THE QUARTERLY TDS STATEMENT/RETURN IN TIME. THE LD. CIT (A) DID NOT ACCEPT THE EXPLANATION OF THE ASSESSEE, HOWEVER, THE PENALTY IMPOSED BY THE AO OF RS. 20,000/- FOR EACH QUARTER WAS RESTRICTED TO MINIMUM OF RS. 10,000/- PER QUART ER. 3. BEFORE US, THE LD. A/R OF THE ASSESSEE HAS SUBMI TTED THAT THE ASSESSEE COULD NOT DEPOSIT THE AMOUNT IN THE GOVERNMENT ACCOUNT DU E TO PAUCITY OF FUNDS AND, THEREFORE, THOUGH THE TDS WAS DEDUCTED AT THE TIME OF CREDITING THE AMOUNT IN THE ACCOUNT OF THE DEDUCTEE, HOWEVER, IN THE ABSENCE OF AVAILABILITY OF FUNDS WITH THE ASSESSEE, THE ASSESSEE COULD NOT PAY THE SAME AND, THEREFORE, THERE WAS A DELAY IN SUBMITTING THE QUARTERLY STATEMENT OF TDS IN FORM N O. 24Q AND 26Q. THE LD. A/R 3 ITA NOS. 166, 167, 168 & 169/JP/2018. M/S. WORLD TRADE PARK LIMITED, JAIPUR. HAS FILED THE STATEMENT OF LEDGER ACCOUNT OF M/S. D EWAN HOUSING FINANCE CORPORATION LTD. AND SUBMITTED THAT THE ASSESSEE WA S HAVING A ESCROW ACCOUNT AND WHATEVER FUNDS WERE AVAILABLE WITH THE ASSESSEE, WA S GOING TO THE ESCROW ACCOUNT AND, THEREFORE DUE TO NON-AVAILABILITY OF FUNDS THE ASSESSEE COULD NOT DEPOSIT THE AMOUNT IN THE GOVERNMENT ACCOUNT AND CONSEQUENTLY T HE ASSESSEE COULD NOT FILE THE STATEMENTS WITHIN THE PERIOD OF LIMITATION. THE LD . A/R HAS FURTHER SUBMITTED THAT THE AO HAS ALSO PASSED THE ORDER UNDER SECTION 201( 1) AND 201(1A) FOR NON- PAYMENT OF TDS AMOUNT. HE HAS FILED A COPY OF THE ORDER DATED 11.11.2013 UNDER SECTION 201(1) AND 201(1A) OF THE ACT. THUS THE LD . A/R HAS PLEADED THAT THE NON- AVAILABILITY OF FUNDS MAY BE CONSIDERED AS A REASON ABLE CAUSE FOR NOT SUBMITTING THE TDS STATEMENT IN TIME AND, THEREFORE, AS PER THE PR OVISIONS OF SECTION 273B OF THE ACT THE EXPLANATION OF THE ASSESSEE BE ACCEPTED AS BONAFIDE AND THE PENALTY LEVIED BY THE AO UNDER SECTION 271H BE DELETED. 3.1 ON THE OTHER HAND, THE LD. D/R HAS RELIED UPON THE ORDERS OF THE AUTHORITIES BELOW AND SUBMITTED THAT THE LD. CIT (A) HAS GIVEN A SPECIFIC FINDING THAT THE ASSESSEE HAS FAILED TO FILE THE QUARTERLY TDS STATE MENT DESPITE DEPOSIT OF TAX. THUS WHEN THE PERIOD OF ONE YEAR IS GIVEN TO THE ASSESSE E FOR SUBMITTING THE STATEMENT TO AVOID THE PENALTY AND THE ASSESSEE HAS FAILED EVEN TO SUBMIT THE QUARTERLY STATEMENT WITHIN THE SAID PERIOD OF ONE YEAR FROM T HE DUE DATE OF FILING THE STATEMENT, THE PENALTY LEVIED BY THE AO AND SUSTAIN ED BY LD. CIT (A) IS JUSTIFIED. 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AS WELL AS THE RELEVANT MATERIAL ON RECORD. THERE IS NO DISPUTE THAT THE ASSESSEE HAS FAILED TO SUBMIT THE QUARTERLY TDS STATEMENTS WITHIN THE PERIOD OF LIMITATION PRESCRIB ED. THE ASSESSEE HAS ALSO NOT 4 ITA NOS. 166, 167, 168 & 169/JP/2018. M/S. WORLD TRADE PARK LIMITED, JAIPUR. DISPUTED THE FAILURE ON ITS PART TO SUBMIT THE STAT EMENT ON DUE DATE. HOWEVER, THE ASSESSEE HAS TAKEN THE PLEA THAT DUE TO PAUCITY OF FUNDS THE ASSESSEE COULD NOT PAY THE AMOUNT OF TDS AND CONSEQUENTLY THE QUARTERLY TD S STATEMENT COULD NOT BE SUBMITTED/DELIVERED WITHIN THE PRESCRIBED PERIOD AS PER THE PROVISIONS OF SECTION 200(3) OF THE ACT READ WITH SECTION 206C. HENCE WE FIND THAT THE FAILURE ON THE PART OF THE ASSESSEE TO FURNISH THE QUARTERLY STATEMENT IS NOT IN DISPUTE. THE ONLY ISSUE IS WHETHER THE ASSESSEE WAS ABLE TO EXPLAIN THE CAU SE OF DELAY WHICH IS BONAFIDE IN TERMS OF PROVISIONS OF SECTION 273B OF THE ACT. AS PER SUB SECTION (3) OF SECTION 271H, NO PENALTY SHALL BE LEVIED FOR THE FAILURE OF THE ASSESSEE TO SUBMIT THE QUARTERLY STATEMENT AND IF THE ASSESSEE PROVES THAT THE TAX DEDUCTED/COLLECTED ALONG WITH FEE AND INTEREST IS DEPOSITED TO THE ACCOUNT O F THE CENTRAL GOVERNMENT AND IT HAD DELIVERED THE QUARTERLY STATEMENT BEFORE THE EX PIRY OF THE PERIOD OF ONE YEAR FROM THE TIME PRESCRIBED FOR DELIVERING OF SUCH STA TEMENT. THUS A FURTHER PERIOD OF ONE YEAR IS ALSO PROVIDED UNDER SUB-SECTION (3) OF SECTION 271H IN CASE THE ASSESSEE DEPOSITED THE AMOUNT OF TDS ALONG WITH FEE AND INTE REST AND ALSO DELIVERED THE STATEMENT WITHIN THE SAID EXTENDED PERIOD OF ONE YE AR. IN THE CASE IN HAND THE ASSESSEE HAS ALSO FAILED TO COMPLY WITH THE PROVISI ONS OF SUB-SECTION (3) OF SECTION 271H. THE AO AS WELL AS THE LD. CIT (A) HAS OBSERV ED THAT THE ASSESSEE HAS FAILED TO FILE THE STATEMENT EVEN AFTER DEPOSITING THE TAX . THIS STATEMENT OF THE AUTHORITIES BELOW APPEARS TO BE CONTRARY TO THE FACT BECAUSE TH E AO HAS ALSO PASSED THE ORDER DATED 11.11.2013 UNDER SECTION 201(1) AND 201(1A) O F THE ACT BY HOLDING THAT THE ASSESSEE HAS FAILED TO DEPOSIT THE TAX AND, THEREFO RE, THE ASSESSEE WAS CONSIDERED AS ASSESSEE IN DEFAULT UNDER SECTION 201. THE ASSE SSEE HAS ALSO FILED THE 5 ITA NOS. 166, 167, 168 & 169/JP/2018. M/S. WORLD TRADE PARK LIMITED, JAIPUR. STATEMENTS OF LEDGER ACCOUNT OF M/S. DEWAN HOUSING FINANCE CORPORATION LTD AND SUBMITTED THAT SINCE THE ASSESSEE WAS HAVING ESCROW ACCOUNT, ALL THE FUNDS AVAILABLE WITH THE ASSESSEE WERE AUTOMATICALLY GOING INTO THE ESCROW ACCOUNT AND THE ASSESSEE WAS NOT HAVING ANY RIGHT TO WITHDRAW THE F UNDS. THUS THE ASSESSEE WAS NOT HAVING ANY FUNDS AVAILABLE FOR DEPOSITING THE T DS COLLECTED TO THE ACCOUNT OF THE CENTRAL GOVERNMENT. SINCE THESE FACTS HAVE NOT BEE N CONSIDERED BY THE AUTHORITIES BELOW AND PARTICULARLY THE REASONS AS RECORDED BY T HE AO AND LD. CIT (A) ARE PRIMA FACIE CONTRADICTORY TO THE ORDER PASSED BY THE AO U NDER SECTION 201(1) AND 201(1A), THEREFORE, WITHOUT EXPRESSING ANY VIEW ON THE MERIT S OF THE EXPLANATION OF THE ASSESSEE IN TERMS OF SECTION 273B, WE ARE OF THE CO NSIDERED OPINION THAT THE EXPLANATION OF THE ASSESSEE BE CONSIDERED AFRESH AT THE LEVEL OF THE AO. ACCORDINGLY, WE SET ASIDE THE IMPUGNED ORDERS OF TH E AUTHORITIES BELOW AND REMIT THE MATTER TO THE RECORD OF THE AO FOR ADJUDICATION OF THE SAME AFRESH AFTER CONSIDERING THE EXPLANATION OF THE ASSESSEE. NEEDL ESS TO SAY, THE ASSESSEE BE GIVEN PROPER OPPORTUNITY OF HEARING. 5. IN THE RESULT, APPEALS OF THE ASSESSEE ARE ALLOW ED FOR STATISTICAL PURPOSES. ORDER IS PRONOUNCED IN THE OPEN COURT ON 21/06/ 2018. SD/- SD/- ( FOE FLAG ;KNO ) ( FOT; IKY JKWO (VIKRAM SINGH YADAV ) (VIJAY PAL RAO) YS[KK LNL;@ ACCOUNTANT MEMBER U;KF;D LNL;@ JUDICIAL MEMBER JAIPUR DATED:- 21/06/2018. DAS/ 6 ITA NOS. 166, 167, 168 & 169/JP/2018. M/S. WORLD TRADE PARK LIMITED, JAIPUR. VKNS'K DH IZFRFYFI VXZSF'KR@ COPY OF THE ORDER FORWARDED TO: 1. THE APPELLANT- M/S. WORLD TRADE PARK LTD., JAIPU R. 2. THE RESPONDENT THE ACIT (TDS), JAIPUR. 3. THE CIT(A). 4. THE CIT, 5. THE DR, ITAT, JAIPUR 6. GUARD FILE (ITA NO. 166(4)/JP/2018) VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASSISTANT. REGISTRAR 7 ITA NOS. 166, 167, 168 & 169/JP/2018. M/S. WORLD TRADE PARK LIMITED, JAIPUR.