DCIT(TDS) 1(1), MUMBAI V. AIR INDIA LTD, MUMBAI

ITA 1720/MUM/2015

• Counselvise Citation: [2015] 134 COUNSELVISE.COM (IT) 2024 (ITAT-MUMBAI)
• Duration Of Justice: 9 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-12-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2008-2009
• Appeal Filed On: 25-03-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Non-deduction of tax
• Section: 201(1); 2

Judgement Text

, , , IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES, A MUMBAI , . , , BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER, AND SHRI D. KARUNAKAR RAO, ACCOUNTANT MEMBER ITA NO.1720/MUM/2015 ASSESSMENT YEAR: 2008-09 DCIT(TDS)-1(1), ROOM NO.802, K.G. MITTAL AAYURVEDIC HOSPITAL BUILDING, CHARNI ROAD, MUMBAI-400002 / VS. M/S AIR INDIA LTD. TAXATION SECTION, 2 ND FLOOR, FINANCE BUILDING, AIR INDIA LTD. OLD AIRPORT, KALINA, SANTACRUZ, MUMBAI-400029 ( / REVENUE) ( !'#$% /ASSESSEE) PAN. NO. AAACA9213E & !' ( %) / DATE OF HEARING : 28/12/2015 ( %) / DATE OF ORDER: 28/12/2015 / O R D E R PER JOGINDER SINGH(JUDICIAL MEMBER) THE REVENUE IS AGGRIEVED BY THE IMPUGNED ORDER DATE D 13/01/2015 OF THE LD. FIRST APPELLATE AUTHORITY, MU MBAI, ! / REVENUE BY SHRI K. RAVI RAMCHANDRAN !'#$% ! / ASSESSEE BY NONE 2 DELETING THE PENALTY IMPOSED U/S 271C OF THE INCOME TAX ACT, 1961, (HEREINAFTER THE ACT). THE ONLY GROUND R AISED IN THIS APPEAL IS THAT THE DEPARTMENT IS IN APPEAL BEF ORE THIS TRIBUNAL AGAINST DELETING THE PENALTY, BY THE LD. F IRST APPELLATE AUTHORITY, IMPOSED BY THE ASSESSING OFFIC ER. 2. DURING HEARING OF THIS APPEAL, THE CRUX OF ARGUM ENT ADVANCED BY SHRI K. RAVI RAMCHANDRAN, LD. SR. DR IS THAT THE DEPARTMENT IS IN APPEAL BEFORE THIS TRIBUNAL AG AINST DELETING THE PENALTY IMPOSED U/S 271C OF THE ACT. O N THE OTHER HAND, NOBODY WAS PRESENT FOR THE ASSESSEE. 2.1. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. THE FACTS , IN BRIEF, ARE THAT THE ASSESSEE IS A PUBLIC UNDERTAKING, ENGA GED IN THE BUSINESS OF TRANSPORTATION OF AIR PASSENGERS AN D AIR CARGO. THE ASSESSING OFFICER VIDE ORDER DATED 28/03 /2011, PASSED U/S 201(1) AND 201(1A) OF THE ACT CONSIDERED THE ASSESSEE AS DEFAULTER FOR NON-DEDUCTION OF TAX WITH RESPECT TO PASSENGER SERVICE FEE (PSF), COLLECTED BY THE AS SESSEE FROM THE PASSENGERS ON BEHALF OF AIRPORT DEVELOPER I.E. MUMBAI INTERNATIONAL AIRPORT LTD (MIAL) BY HOLDING THAT SUCH PSF WAS PART OF FARE/REVENUE, RECEIVED BY THE ASSESSEE, THEREFORE, TAX SHOULD HAVE BEEN DEDUCTED AT SOURCE BY THE ASSESSEE U/S 194 I OF THE ACT. 2.2. BEFORE THE LD. COMMISSIONER OF INCOME TAX (APPEALS), IT WAS EXPLAINED BY THE ASSESSEE THAT TH E NOTICE ISSUED TO THE ASSESSEE WAS NOT SERVED AT THE RIGHT ADDRESS 3 AND AT THE SAME TIME, THE ASSESSEE VIDE LETTER DATE D 09/11/2011 MADE APPLICATION BEFORE THE ASSESSING OF FICER U/S 220 (6) OF THE ACT PRAYING THAT PENDING DISPOSA L OF APPEAL BEFORE THE LD. COMMISSIONER OF INCOME TAX (APPEALS), THE DEMAND SO RAISED VIDE ORDER DATED 28/03/2011 MAY BE KEPT IN ABEYANCE. THE LD. ADDL. CIT(TDS) ISSUED NOTICE U/S 271C OF THE ACT FIXING T HE DATE OF HEARING ON 18/12/2012. AS PER THE ASSESSEE, ALL TAXATION MATTER ARE BEING ATTENDED BY DIRECTOR FINANCE AND O THER STAFF ATTACHED TO HIM AT THE OFFICE AT OLD AIRPORT SANTACRUZ (EAST), KALINA, MUMBAI, WHEREAS, THE NOTICE WAS ISS UED TO THE ASSESSEE AT ITS AIR INDIA BUILDING, NARIMAN POI NT, MUMBAI, THUS, FIRSTLY, THE NOTICE WAS ISSUED AT THE WRONG ADDRESS AND SECONDLY, THERE WAS A DELAY IN RECEIVIN G THE NOTICE BY THE TAXATION SECTION. ON RECEIPT OF THE NOTICE, THE DY. MANAGER FINANCE, ADDRESSED A LETTER DATED 25/01/2013 TO THE ADDL. CIT EXPLAINING THE REASONS OF DELAY IN COMPLIANCE. MEANTIME, THE ADDL. CIT VIDE ORDER DATED 28/01/2013 IMPOSED PENALTY U/S 271C OF THE AC T AT RS.4,50,43,746/-. 2.3. THE AGGRIEVED ASSESSEE FILED APPEAL BEFORE TH E LD. COMMISSIONER OF INCOME TAX (APPEALS), WHO VIDE ORDE R DATED 13/01/2015, CONSIDERED THE SUBMISSIONS OF THE ASSESSEE AND HELD THAT ASSESSMENT AND PENALTY PROCEEDINGS ARE DIFFERENT AND BY FOLLOWING THE DECI SION FROM HONBLE APEX COURT IN CIT VS KHODAY ESWARA & SONS 8 3 ITR 369 (SC) AND FURTHER THE DECISION OF THE TRIBUN AL IN 4 M/S VIP INDUSTRIES LTD. (4524 AND 4383/MUM/2006) HE LD THAT IT WAS NOT A CASE OF IMPOSING PENALTY. THE LD. COMMISSIONER OF INCOME TAX (APPEALS) ALSO CONSIDERE D THE DECISION OF THE TRIBUNAL IN THE CASE OF JET AIRWAYS (INDIA) LTD. (ITA NO.5264/MUM/2012) ORDER DATED 23/10/2013 FOR A.Y. 2010-11 BY HOLDING THAT ASSESSEE IS NOT LIABLE TO DEDUCT TAX U/S 194 I OF THE ACT ON PASSENGER SERVIC E FEE (PSF) CHARGED BY MUMBAI INTERNATIONAL AIRPORT LTD. NOW THE REVENUE IS IN APPEAL BEFORE THIS TRIBUNAL. 2.4. IF THE OBSERVATION MADE IN THE PENALTY ORDER, LEADING TO ADDITION MADE TO THE TOTAL INCOME, CONCL USION DRAWN IN THE IMPUGNED ORDER, MATERIAL AVAILABLE ON RECORD, ASSERTIONS MADE BY THE LD. RESPECTIVE COUNSEL, IF K EPT IN JUXTAPOSITION AND ANALYZED, UNDER THE FACTS, STATED HEREINABOVE, THE ONLY GROUND RAISED BEFORE US IS TH AT THE DEPARTMENT HAS FILED THE APPEAL BEFORE THE TRIBUNAL . WE NOTE THAT THE TRIBUNAL IN THE AFORESAID CASES MORE SPECIFICALLY JET AIRWAYS (INDIA) LTD. (SUPRA), THE TRIBUNAL HAS ALREADY HELD THAT THE ASSESSEE IS NOT LIABLE TO DEDUCT TAX U/S 194 I OF THE ACT. EVEN OTHERWISE, QUANTUM A ND PENALTY PROCEEDING ARE ALTOGETHER DIFFERENT AND INDEPENDENT. OUR VIEW FINDS SUPPORTS FROM THE RATIO LAID DOWN, THOUGH U/S 271(1)(C) OF THE ACT IN DECISION OF THE TRIBUNAL IN M/S PARLE BOTTLING PVT. LTD. (ITA NO.1209/MUM/20 14) ORDER DATED 23/11/2015 AND FURTHER IN CIT VS S.P VI Z CONSTRUCTION COMPANY 176 ITR 47 (PATNA) AND K.C. 5 BUILDERS VS ACIT 265 ITR 562 (SUPREME COURT). WE AR E OF THE VIEW THAT WHERE THE PENALTY FOR CONCEALMENT OR FURNISHING INACCURATE PARTICULARS WAS LEVIED AND AF TER DELETING THE QUANTUM ADDITION, THERE REMAINS NO BAS IS AT ALL FOR LEVYING THE PENALTY. ORDINARILY, PENALTY C ANNOT STAND IN ITSELF IF THE ADDITION MADE IN THE ASSESSMENT IT SELF IS SET ASIDE OR CANCELLED BY THE SUPERIOR AUTHORITY/COURT. THE PENALTY CANNOT STAND BY ITSELF BECAUSE FALSE RESULT MAY BE PRODUCED BY THE FALSITY OF ONE OR MORE OF THE CONST ITUENT ITEMS IN THE RETURN. THE WORD INACCURATE PARTICUL ARS WOULD COVER FALSITY IN THE FINAL FIGURE AND ALSO TH E CONSTITUENT ELEMENTS OR ITEMS. THEY SIMPLY WOULD M EAN INACCURATE IN SOME SPECIFIC OR DEFINITE RESPECT WHE THER IN THE CONSTITUENT OR SUBORDINATE ITEMS OF INCOME OR T HE END RESULT. CONCEALMENT OR FURNISHING INACCURATE PARTI CULARS IMPLIES SOME DELIBERATE ACT ON THE PART OF THE ASSE SSEE IN WITHHOLDING THE TRUE FACTS FROM THE AUTHORITIES. S INCE, THE BASIS OF LEVYING PENALTY REMAINS NO MORE IN EXISTEN CE, AFTER DELETION OF QUANTUM ADDITION, THEREFORE, FROM THIS ANGLE, THE STAND OF THE LD. COMMISSIONER OF INCOME TAX (AP PEALS) IS JUSTIFIED. HOWEVER, ON THE ISSUE IN HAND U/S 194 I OF THE ACT, THE TRIBUNAL HAS ALREADY TAKEN A VIEW BY HOLDING THAT THE ASSESSEE IS IN DEFAULT, THEREFORE, FOLLOWING THE AF ORESAID DECISION OF THE TRIBUNAL IN THE CASE OF JET AIRWAYS (INDIA) LTD., WE FIND NO INFIRMITY IN THE CONCLUSION OF THE LD. 6 COMMISSIONER OF INCOME TAX (APPEALS). WE AFFIRM THE SAME. FINALLY, THE APPEAL OF THE REVENUE IS DISMISSED. THIS ORDER WAS PRONOUNCED IN THE OPEN COURT IN THE PRESENCE OF THE LD. REPRESENTATIVE FROM BOTH SIDES AT THE CONCLUSION OF THE HEARING ON 28/12/2015. SD/- SD/- ( D. KARUNAKAR RAO ) (JOGINDER SINGH) '!# / ACCOUNTANT MEMBER $!# /JUDICIAL MEMBER & ' MUMBAI; +! DATED : 28/12/2015 F{X~{T? P.S/. !. . %$&'()(*& / COPY OF THE ORDER FORWARDED TO : 1. ,-./ / THE APPELLANT (RESPECTIVE ASSESSEE) 2. 01./ / THE RESPONDENT. 3. 2 2 & 3% ( ,- ) / THE CIT, MUMBAI. 4. 2 2 & 3% / CIT(A)- , MUMBAI, 5. 56 0%!' , 2 ,-) ,' , & ' / DR, ITAT, MUMBAI 6. # 7' / GUARD FILE. ! / BY ORDER, 15-% 0% //TRUE COPY// /! (DY./ASSTT. REGISTRAR) , & ' / ITAT, MUMBAI