M/s.IGATE Infrastructure Management Services Ltd, Bangalore V. Deputy Commissioner of Income-Tax, Bangalore

ITA 1703/BANG/2016

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 5402 (ITAT-BANGALORE)
• Duration Of Justice: 7 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-04-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Assessment Year: 2010-2011
• Appeal Filed On: 27-09-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RENUGADEVI JT
• Assessee Lawyers: PADAMCHAND KHINCHA

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH : BANGALORE BEFORE SHRI SUNIL KUMAR YADAV, JUDICIAL MEMBER AND SHRI A.K. GARODIA, ACCOUNTANT MEMBER ITA NO. 1703/BANG/2016 ASSESSMENT YEAR : 2010-11 IGATE INFRASTRUCTURE MANAGEMENT SERVICES LTD., NO.158-162 & 165-170, EPIP PHASE II, WHITEFIELD, BANGALORE 560 066. PAN: AABCI 1844G VS. THE DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE 11(4), BANGALORE. APPELLANT RESPONDENT APPELLANT BY : SHRI PADAM CHAND KHINCHA, CA RESPONDENT BY : MS. RENUGA DEVI, JT. CI(T(DR) DATE OF HEARING : 27.04.2017 DATE OF PRONOUNCEMENT : 28.04.2017 O R D E R PER SUNIL KUMAR YADAV, JUDICIAL MEMBER THIS APPEAL IS PREFERRED BY THE ASSESSEE AGAINST THE ORDER OF CIT(APPEALS) INTER ALIA ON THE FOLLOWING GROUNDS:- 1.1 THE LEARNED COMMISSIONER OF INCOME TAX (APPEA LS) - 3, BENGALURU HAS ERRED IN PASSING THE ORDER IN THE MAN NER PASSED BY HIM. ITA NO.1703/BANG/2016 PAGE 2 OF 6 1.2 THE LEARNED COMMISSIONER OF INCOME TAX (APPEAL S) - 3, BENGALURU HAS ERRED IN NOT ALLOWING CREDIT IN RESPE CT OF TDS DEDUCTED AND DEPOSITED BY CERTAIN CUSTOMERS WRONGLY IN THE ERSTWHILE NAME OF THE APPELLANT (IT &T TECHNOLOGY S ERVICES LIMITED NOW KNOWN AS IGATE INFRASTRUCTURE MANAGEMEN T SERVICES LIMITED) OF RS. 61,84,211/-. 1.3 THE LEARNED COMMISSIONER OF INCOME TAX (APPEAL S) - 3, BENGALURU HAS ERRED III CONCLUDING THAT; (I) IT &T TECHNOLOGY SERVICES LIMITED (IT &T) AND THE APPELLANT ARE TWO DIFFERENT ENTITIES AS IT HAS A DI FFERENT PAN (II) THE PAYERS WHO HAVE DEDUCTED TAX IN THE OLD NA ME OF THE APPELLANT HAS NOT FURNISHED A STATEMENT INDICATING THE NEW NAME OF THE APPELLANT 1.4 THE LEARNED COMMISSIONER OF INCOME TAX (APPEAL S) 3 HAS ERRED IN NOT APPRECIATING THAT (I) THE IT &T TECHNOLOGY SERVICES LTD WAS THE EARL IER NAME OF THE APPELLANT HAVING AN OLD PAN [AAACI934L] AND A N EW PAN [AABCI1844G] WAS OBTAINED AFTER CHANGING THE NAME; (II) SUBSEQUENT TO THE CHANGE IN NAME, THE APPELLA NT HAS BEEN FILING ITS RETURN OF INCOME IN THE NEW NAME / NEW P AN AND NO SEPARATE RETURN HAS BEEN FILED IN THE OLD NAME. (III) SINCE THERE IS NO SEPARATE ENTITY WITH THE N AME IT &T TECHNOLOGY SERVICES LIMITED, THE AMOUNT OF TDS DEPO SITED IN ITS NAME CANNOT BE CLAIMED AS NO SEPARATE RETURN OF INCOME IS FILED; AND (IV) THE STATUTORY RIGHT OF CREDIT OF TDS CANNOT B E DENIED MERELY FOR THE FACT THAT THE PAYERS HAVE NOT FILED A STATE MENT INDICATING THE NEW NAME OF THE APPELLANT. 1.5 ON FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND LAW APPLICABLE, THE APPELLANT IS ENTITLED FOR CREDIT OF TDS OF RS. 61,84,211/-DEDUCTED IN ITS ERSTWHILE NAME [IT &T TECHNOLOGY SERVICES LIMITED]. ITA NO.1703/BANG/2016 PAGE 3 OF 6 1.6 THE LEARNED COMMISSIONER OF INCOME TAX (APPEAL S) - 3 HAS ERRED IN NOT ALLOWING THE DIFFERENTIAL TDS CREDIT O F RS. 41,173 (RS. 1,41,10,000 - RS. 1,40,68,827), I.E., T HE DIFFERENCE BETWEEN THE TDS CLAIMED IN THE RETURN OF INCOME AS PER THE ORIGINAL CERTIFICATES AVAILABLE AND TDS AS APPEARING IN FORM 26AS OF BOTH THE ABOVE MENTIONED NAMES OF THE APPELLANT. 1.7 ON FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND LAW APPLICABLE, THE CREDIT OF TDS TO BE ALLOWED ON THE BASIS OF TDS CERTIFICATES WHICH WERE AT ALL TIMES AVAILABLE WITH THE APPELLANT AND FURNISHED BEFORE THE LOWER AUTHORITIE S. PRAYER 8.1 IN VIEW OF THE ABOVE AND OTHER GROUNDS TO BE A DDUCED AT THE TIME OF HEARING, THE APPELLANT PRAYS THAT THE O RDER PASSED BY THE LOWER AUTHORITIES BE QUASHED OR IN THE ALTERNATIVE (I) CREDIT TOWARDS TDS DEDUCTED IN THE ERSTWHILE NAME OF THE APPELLANT TO BE ALLOWED. (II) CREDIT OF TDS TO BE ALLOWED ON THE BASIS OF T HE BASIS OF TDS CERTIFICATES AND NOT ON THE BASIS OF FORM 26AS. THE APPELLANT PRAYS ACCORDINGLY. 2. DURING THE COURSE OF HEARING, THE LD. COUNSEL F OR THE ASSESSEE HAS INVITED OUR ATTENTION TO THE FACT THAT AO HAS NOT A LLOWED THE TDS CREDIT DEDUCTED BY THE PAYERS, WHILE MAKING THE PAYMENT TO THE ASSESSEE. THE LD. COUNSEL FOR THE ASSESSEE HAS FURTHER CONTENDED THAT NAME OF THE APPELLANT-ASSESSEE WAS EARLIER IT&T TECHNOLOGY SERV ICES LTD. (IT&T) WITH PAN NO.AAACI 9340L, BUT ALTER THE NAME OF THE COMPA NY WAS CHANGED TO IGATE INFRASTRUCTURE MANAGEMENT SERVICES LTD. WITH PAN NO.AABCI ITA NO.1703/BANG/2016 PAGE 4 OF 6 1844G. SUBSEQUENT TO CHANGE IN THE NAME, ASSESSEE HAS BEEN FILING ITS RETURN OF INCOME IN NEW NAME AND NEW PAN, BUT UNFOR TUNATELY SOME OF THE PAYERS HAVE DEDUCTED TDS AND DEPOSITED IN THE ERSTW HILE NAME OF ASSESSEE I.E., IT&T TECHNOLOGY SERVICES LTD. WITH O LD PAN NO. THE CREDIT OF TDS DEDUCTED AND DEPOSITED IN THE OLD NAME AND O LD PAN NO. AND THE CREDIT OF THE SAME WAS NOT GIVEN TO THE ASSESSEE ON ACCOUNT OF MISMATCH, THOUGH ENTITY IS THE SAME. 3. THE LD. COUNSEL FOR THE ASSESSEE FURTHER INVITED OUR ATTENTION TO CIRCULAR ISSUED BY THE CBDT VIDE INSTRUCTION NO.5/2 013 DATED 8.7.2013, THROUGH WHICH IT HAS BEEN CLARIFIED THAT IF THE ASS ESSEE APPROACHES THE AO WITH REQUISITE DETAILS AND PARTICULARS IN THE FORM OF TDS AS AN EVIDENCE AGAINST ANY MISMATCHED AMOUNT, THE SAID ASSESSING O FFICER WILL VERIFY WHETHER OR NOT THE DEDUCTOR HAS MADE THE PAYMENT OF THE TDS IN THE GOVERNMENT ACCOUNT AND IF THE PAYMENT HAS BEEN MADE , CREDIT OF THE SAME SHOULD BE GIVEN TO THE ASSESSEE. 4. THE LD. COUNSEL FOR THE ASSESSEE FURTHER CONTEND ED THAT INSTEAD OF REJECTING THE CLAIM OF CREDIT TO THE ASSESSEE, THE AO SHOULD HAVE EXAMINED THE FACTS AND IF IT WAS FOUND THAT TDS WAS DEDUCTED AND CREDITED BY THE DEDUCTOR IN THE GOVERNMENT ACCOUNT, THEN THE CREDIT OF THE SAME SHOULD HAVE BEEN GIVEN TO THE ASSESSEE. 5. THE LD. DR PLACED RELIANCE UPON THE ORDER OF CIT (APPEALS) WITH THE SUBMISSION THAT DEDUCTOR CAN MAKE NECESSARY RECTIFI CATION WITH THE ITA NO.1703/BANG/2016 PAGE 5 OF 6 AUTHORITIES CONCERNED WITH REGARD TO ERROR IN THE N AME OF THE DEDUCTEE AND ITS PAN NO. 6. HAVING CAREFULLY EXAMINED THE ORDER OF LOWER AUT HORITIES IN THE LIGHT OF RIVAL SUBMISSIONS, WE FIND THAT UNDISPUTEDLY THE RE IS A MISTAKE COMMITTED BY THE DEDUCTOR WHILE DEDUCTING AND DEPOSITING THE TDS, BUT IT DOES NOT MEAN THAT DEDUCTEE SHOULD SUFFER FOR THE ACT OF DED UCTOR. WHEN THERE IS MISMATCH IN THE TDS ACCOUNTS, THE AO SHOULD MAKE NE CESSARY VERIFICATION AND IF IT IS FOUND THAT TDS WAS DEDUCTED AND PAID I N THE GOVERNMENT ACCOUNT, CREDIT OF THE SAME SHOULD BE GIVEN TO THE DEDUCTEE. THIS ASPECT WAS ALSO CLARIFIED BY THE CBDT BY ISSUING INSTRUCTI ON NO.5/13. FOR THE SAKE OF REFERENCE, WE EXTRACT THE INSTRUCTION AS UNDER:- 3. IN VIEW OF THE ORDER OF THE HONBLE DELHI HIGH COURT (REFERENCE: PARA 50 OF THE ORDER); IT HAS BEEN DECI DED BY THE BOARD THAT WHEN AN ASSESSEE APPROACHES THE ASSESSING OFFI CER WITH REQUISITE DETAILS AND PARTICULARS IN THE FORM OF TD S CERTIFICATE AS AN EVIDENCE AGAINST ANY MISMATCHED AMOUNT, THE SAID ASSESSING OFFICER WILL VERIFY WHETHER OR NOT THE DEDUCTOR HAS MADE PAYMENT OF THE TDS IN THE GOVERNMENT ACCOUNT AND IF THE PAY MENT HAS BEEN MADE, CREDIT OF THE SAME SHOULD BE GIVEN TO TH E ASSESSEE. HOWEVER, THE ASSESSING OFFICER IS AT LIBERTY TO ASC ERTAIN AND VERIFY THE TRUE AND CORRECT POSITION ABOUT THE TDS WITH THE RELEVANT AO (TDS). THE AO MAY ALSO, IF DEEMED NECES SARY, ISSUE A NOTICE TO THE DEDUCTOR TO COMPEL HIM TO FILE CORR ECTION STATEMENT AS PER THE PROCEDURE LAID DOWN. 7. IN THE LIGHT OF THIS INSTRUCTION, WE SET ASIDE T HE ORDER OF CIT(APPEALS) AND RESTORE THE MATTER TO THE FILE OF ASSESSING OFF ICER TO ADJUDICATE THE ISSUE AFRESH, AFTER MAKING NECESSARY VERIFICATION A ND IF IT IS FOUND THAT THE ITA NO.1703/BANG/2016 PAGE 6 OF 6 DEDUCTOR HAS DEDUCTED THE TDS AND DEPOSITED IN THE GOVERNMENT ACCOUNT, CREDIT OF THE SAME SHOULD BE GIVEN TO THE ASSESSEE. 8. IN THE RESULT, THE APPEAL OF ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. PRONOUNCED IN THE OPEN COURT ON THIS 28 TH DAY OF APRIL, 2017. SD/- SD/- ( A.K. GARODIA ) (SUNIL KUMAR YA DAV ) ACCOUNTANT MEMBER JUDIC IAL MEMBER BANGALORE, DATED, THE 28 TH APRIL, 2017. / D ESAI S MURTHY / COPY TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR, ITAT, BANGALORE. 6. GUARD FILE BY ORDER ASSISTANT REGISTRAR, ITAT, BANGALORE.