HIGH POWER ELEVATORS PVT LTD, Visakhapatnam V. INCOME TAX OFFICER, TDS WARD-1, Visakhapatnam

ITA 171/VIZ/2022

• Counselvise Citation: [2022] 103 COUNSELVISE.COM (IT) 9998 (ITAT-VISAKHAPATNAM)
• Duration Of Justice: 1 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-10-2022
• Appeal Filed By: Assessee
• Order Result: PartlyAllowed
• Bench Allotted: SMC
• Next Hearing Date: 17-10-2022
• Assessment Year: 2018-2019
• Appeal Filed On: 07-09-2022
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: TDS
• Section: 131; 201(1)

Judgement Text

आयकर अपीलȣयअͬधकरण, ͪवशाखापटणम पीठ, ͪवशाखापटणम IN THE INCOME TAX APPELLATE TRIBUNAL, VISAKHAPATNAM ‘SMC’ BENCH, VISAKHAPATNAM Įी दुåवूǽ आर एल रेɬडी, ÛयाǓयक सदèय एवं Įी एस बालाकृçणन, लेखा सदèय के सम¢ BEFORE SHRI DUVVURU RL REDDY, HON’BLE JUDICIAL MEMBER आयकर अपील सं./ I.T.A. Nos.166, 167, 168, 169, 170, 171 & 172/Viz/2022 (Ǔनधा[रण वष[ / Assessment Years: 2013-14, 2014-15, 2015-16, 2016-17, 2017-18, 2018-19 & 2019-20) High Power Elevators Private Limited, Visakhapatnam. PAN: AAPCH 7132 E Vs. Income Tax Officer, TDS Ward-1, Visakhapatnam. (अपीलाथȸ/ Appellant) (Ĥ×यथȸ/ Respondent) अपीलाथȸ कȧ ओर से/ Appellant by : Sri GVN Hari, Advocate Ĥ×याथȸ कȧ ओर से / Respondent by : Sri ON Hari Prasada Rao, Sr. AR सुनवाई कȧ तारȣख / Date of Hearing : 18/10/2022 घोषणा कȧ तारȣख/Date of Pronouncement : 20/10/2022 O R D E R PER DUVVURU RL REDDY, Judicial Member : All the captioned appeals are filed by the assessee against the orders of the Learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi [Ld. CIT(A)] in DIN & Order No. ITBA/NFAC/S/250/2022-23/1043650824(1); 2 1043650981(1); 1043651074(1); 1043651199(1); 1043651301(1); 1043651416(1) and 1043651497(1), dated 29/06/2022 for the AYs 2013-14 to 2019-20 arising out of the orders passed U/s. 201(1A) of the Income Tax Act, 1961 [the Act]. Since, the issues raised in all these appeals are identical for all the AYs under consideration as well as the appeals pertaining to the same assessee, all these appeals are clubbed, heard together and disposed off in this consolidated order. 2. At the outset, it is noted that in all the instant appeals, there is a delay of 11 days in filing the appeals before the Tribunal beyond the prescribed time limit. In this regard the Learned Authorized Representative [Ld. AR] brought my attention to the affidavits filed by the assessee seeking condonation of delay, the contents of the affidavits for the all the AYs are same, and read out the following relevant portion of the condonation petition which reads as under: “The delay in filing the appeal by the petitioner for the AY...... was no t at all intentional or willful and it occurred under the unavoidable and exceptional circumstances beyond the control of the pe titioner. So it can be appreciated that the pe titioner was prevented by reasonable and sufficient cause from filing appeal in time. The Managing Director of the pe titioner was suffering fro m ill heal th during the relevant period and infac t he was bedridden. So he could not ac t by 3 responding to the no tices issued by NFAC. Moreover, he is no t acquainted with the computer syste ms and emails e tc., and hence he depends on his accountant who did no t ac t properly and in fact ac ted callously and negligently and did not look into the mails sent by NFAC. So there was communication gap and this was the main reason for non-responding to the no tices.................” 3. Therefore, the Ld. AR pleaded that since the assessee is prevented by a reasonable and sufficient cause, the delay in filing the present appeals may be condoned. 4. On perusal of the contents of the affidavits filed by the assessee for all the AYs under consideration as well as the prayer of the Ld. AR, I am of the considered view that since the assessee was prevented by a reasonable and sufficient cause in filing the appeals beyond the prescribed time limit, I find that these are the fit cases to condone the delay. Accordingly, I hereby condone the delay of 11 days in all the instant appeals and proceed to adjudicate the appeals on merits. 5. The assessee has raised identical grounds in all the present appeals, the only difference is in figures, and therefore, the grounds raised by the assessee in its appeal for the AY 2013-14 are extracted herein below for reference: 4 “1. The appellate order dated 29/06/2022 passed U/s. 250 of the I T Act by CIT(A), NFAC is unjust and uncalled f or. 2. The Ld. Appellate Authority ought to have appreciated the f act that the appellant company was prevented by reasonable and sufficient cause f rom f iling response to the notices issued by NFAC during the course of appellate proceedings. So the NFAC ought to have aff orded one more opportunity to the appellant comp any by issuing paper notice physically to the appellant co mpany. 3. The Ld. Appellate Authority ought to have appreciated the f act that the appellant company’s Managing Director was suff ering f rom ill health during the relevant period and inf act he was bedridden. So he could not act by responding to the notices issued by NFAC. Moreover, he is not acquitted with the computer syste ms and emails., and hence he depends on his accountant who did not act properly and in f act acted callously and negligently and did not look into the mails sent by NFAC. So there was communication gap and this was the main reason f or non responding to the notices. 4. The Ld. Appellate Authority ought to have appreciated the f act that the appellant company has got merits as its case as the so called payments which as per the view of the department attracted TDS provisions, did not attract the TDS provisions as each payment was less than threshold limit. 5. The Ld. Appellate Authority ought to have appreciated the f act that the appellant company has got all the materials, data, evidences and inf ormation in its possession to prove its contentions with regard to the impugned payments on which it was alleged that the TDS was no t deducted, but inf act there was no necessity f or TDS as each payment was less than threshold limit.” 6. Brief facts of the case are that the assessee is engaged in installations, maintenance and servicing of the lifts and elevators. Since the assessee is under obligation to file the TDS quarterly statements, during the scrutiny proceedings it was observed by the Assessing Officer that since FY 2009-10, the 5 assessee is not filing any TDS quarterly statements. Further, the Ld. AO also observed from the Oltas Challan details of the TRACES module that the assessee being a deductor neither deducted nor remitted any TDS. In order to verify the above discrepancies and to verify the compliance to various TDS provisions of the Act, a TDS survey was conducted in the business premises of the assessee with the due approval of the concerned higher authorities. During the survey the assessee did not submit the books of account and stated that they are not readily available in the survey premises. Subsequently, considering the assessee’s no response to the summons U/s. 131 of the Act, the Ld. AO issued a show cause notice to the assessee as to why the assessee should not be treated as assessee in default u/s. 201(1) / 201(1A) of the Act as the assessee has failed to deduct TDS on the expenditure made for AYs under consideration. In response the Managing Director of the assessee company appeared before the Ld. AO and furnished the documents. On verification of the documentary evidences as well as the submissions made by the assessee, the Ld. AO noted that the assessee debited certain expenditure to P & L Account under various heads but did not make any TDS under the provisions of the Act and therefore the Ld. AO called for further details. In the 6 absence of any response from the assessee’s side, the Ld. AO invoked the provisions of section 201(1) / 201(1A) of the Act and made additions. Aggrieved by the order of the Ld. AO, the assessee went on appeal before the Ld. CIT(A), NFAC, Delhi. 7. Before the Ld. CIT(A), there was no representation on behalf of the assessee nor filed any submissions in support of the grounds raised before the Ld. CIT(A). Considering the same, the Ld. CIT(A) was of the opinion that the assessee is not interested in prosecuting the appeals filed and therefore relying on certain decision of various Benches of the ITAT and also that of the judgment of the Hon’ble Supreme Court in the case of CIT vs. B.N. Bhattacharjee and Others [1979] 10 CTR 354 (SC), the Ld. CIT(A) dismissed the assessee’s appeal ex-parte. Aggrieved by the order of the Ld. CIT(A), the assessee filed the present appeals before the Tribunal by raising the above mentioned grounds of appeal. 8. At the outset, the Ld. AR submitted before me that the Ld. CIT (A) has passed ex-parte orders without providing proper opportunity to the assessee of being heard. The Ld. AR further submitted that now the assessee-company has got all the materials, data, evidences and 7 information in its possession to prove its contentions with regard to the impugned payments on which it was alleged that the TDS was not deducted. He further submitted that in fact there was no necessity for TDS as each payment was less than the threshold limit. It was therefore pleaded that the matter may be remitted back to the file of the Ld CIT (A) in order to provide one more opportunity to the assessee of being heard. Ld. DR, on the other hand, vehemently opposed to the submissions of the Ld. AR and argued that though several opportunities had been provided to the assessee however, on the given dates of hearing, neither the assessee nor its Representative appeared before the Ld. CIT (A). It was further submitted that the assessee has not even resorted to file any submissions in support of the grounds of appeal raised before the Ld. CIT(A). Under these circumstances, the Ld. CIT (A) had no other option but to pass ex-parte order based on the materials available on record. Hence, it was pleaded that the order passed by the Ld. CIT(A) does not call for any interference. 9. I have heard the rival submissions and carefully perused the materials on record and the orders of the Ld. Revenue Authorities. On examining the facts of the case, I find that the Ld. CIT (A) had posted the cases for hearing on several occasions. However, none appeared on 8 behalf of the assessee before the CIT(A) on the dates of hearing nor filed any submissions in support of its claim. Therefore, the Ld. CIT (A) was left with no other option except to adjudicate the appeal ex-parte. Before me it is the submission of the Ld. AR that the assessee-company has got all the materials, data, evidences and information in its possession to prove its contentions with regard to the impugned payments on which it was alleged that the TDS was not deducted. He further submitted that in fact there was no necessity for TDS as each payment was less than the threshold limit. In this situation, I find strength in the arguments advanced by the ld. AR. Therefore, considering the prayer of the Ld. AR, and in the interest of justice, and also strictly following the principles of natural justice, I hereby remit the matter back to the file of Ld. CIT (A) in order to consider the appeal afresh on merits by providing one more opportunity to the assessee of being heard. At the same breath, I also hereby caution the assessee to promptly co-operate before the Ld. CIT (A) in the proceedings failing which the Ld. CIT (A) shall be at liberty to pass appropriate order in accordance with law and merits based on the materials on the record. It is ordered accordingly. 10. Since the grounds as well as the issues raised by the assessee in all the instant appeals are identical, my decision given in the assessee’s 9 appeal for the AY 2013-14 mutatis mutandis applies to the appeals for the AYs 2014-15; 2015-16; 2016-17; 2017-18; 2018-19 and AY 2019-20. 11. In the result, all the seven appeals filed by the assessee are allowed for statistical purposes as indicated hereinabove. Pronounced in the open Court on the 20 th October, 2022. Sd/- (दुåवूǽ आर.एल रेɬडी) (DUVVURU RL REDDY) ÛयाǓयकसदèय/JUDICIAL MEMBER Dated :20.10.2022 OKK - SPS आदेश कȧ ĤǓतͧलͪप अĒेͪषत/Copy of the order forwarded to:- 1. Ǔनधा[ǐरती/ The Assessee – High Power Elevators Private Limited, 39- 324/1, Near Masjid Road, Kailasapuram Road, Sector-3, Muralinagar, Visakhapatnam. 2. राजèव/The Revenue –Income Tax Officer, TDS Ward-1, Visakhapatnam. 3. The Principal Commissioner of Income Tax, 4.आयकर आयुÈत (अपील)/ The Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi. 5. ͪवभागीय ĤǓतǓनͬध, आयकर अपीलȣय अͬधकरण, ͪवशाखापटणम/ DR, ITAT, Visakhapatnam 6.गाड[ फ़ाईल / Guard file आदेशानुसार / BY ORDER Sr. Private Secretary ITAT, Visakhapatnam