CANARA BANK, MUMBAI V. DCIT TDS 1(1), MUMBAI

ITA 1742/MUM/2017

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 0670 (ITAT-MUMBAI)
• Duration Of Justice: 2 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-05-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2009-2010
• Appeal Filed On: 10-03-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SAURABH DESH
• Keywords: Maximum Marginal Rate; Application of stay
• Section: 201(1)

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, MUMBAI BEFORE SHRI MAHAVIR SINGH , JM AND SHRI RAJESH KUMAR, AM ./ I .T.A. NO S . 1742 TO 1745 / MUM/201 7 ( / ASSESSMENT YEA RS : 200 9 - 10 TO 2 012 - 13 ) CANARA BANK, PREMISES AND ESTATE SECTION, CIRCLE OFFICE, 2 ND FLOOR, C - 14,G - BLOCK,OPP.PETROLPUMP B - K - C, BANDRA (W), MUMBAI - 400051 VS. DY.COMMISSIONER OF INCOME TAX (TDS) 1(1), 8 TH FLOOR, R . NO. 802 , SMT. K.G.MITTAL AYURVEDIC HOSPITAL BUILDING, CHA RNI ROAD, MUMBAI - 400002 / APPELLANT .. / RESPONDENT S A NOS.240 TO 243/MUM/2017 ARISING OUT I .T.A. NO S.1742 TO 1745/MUM/2017 ( / ASSESSMENT YEA RS : 2009 - 10 TO 2012 - 13 ) CANARA BANK, PREMISES AND ESTATE SECTION, CIRCLE OFFICE, 2 ND FLOOR, C - 14, G - BLOCK,OPP.PETROLPUMP B - K - C, BANDRA (W), MUMBAI - 400051 VS. DY.COMMISSIONER OF INCOME TAX (TDS) 1(1), 8 TH FLOOR, R . NO. 802 , SMT. K.G.MITTAL AYURVEDIC HOSPITAL BUILDING, CHARNI ROAD, MUMBAI - 400002 / APPELLANT .. / RESPONDENT ./ PAN : AA ACC6106G / A SSESSEE BY : SHRI VIJAY MEHTA / R E VENUE BY : SHRI SAURABH DESHPANDE / DATE OF HEARING : 12.5 . 201 7 / DATE OF PRONOUNCEMENT : 12.5.2017 2 CANARA BANKS ITA ALONG WITH SA / O R D E R PER RAJESH KUMAR, ACCOUNTANT MEMBER : THE ASSESSEE HAS FILED FOUR SA BEARING S.A. NOS.240 TO 243/MUM/2017 ARISING OUT THESE FOUR APPEALS FROM ASSESSMENT YEAR 2009 - 10 TO 2012 - 13 SEEKING STAY OF DEMAND RAISED BY THE ITO TDS VIDE ORDERS PASSED FOR THE SE FOUR YEARS U/S 201(1)/201(1A) OF THE ACT. THE ASSESSEE HAS ALSO FILED FOUR APPEALS DIRECTED AGAINST THE ORDER S DATED 22.1.2015 AND 14.5.2015 PASSED BY THE LD.CIT(A) FOR THE ASSESSMENT YEARS 2009 - 10 TO 2011 - 12 AND 2012 - 13 RESPECTIVELY. THE FIRST APPELLAT E AUTHORITY HAS DISMISSED THE FOUR APPEALS ON TECHNICAL GROUNDS WITHOUT GOING INTO THE MERITS OF AND WE ARE DECIDING THESE APPEALS FIRST BEFORE TAKING UP THE SAS 2 . WE FIND FROM THE APPEAL RECORD THAT THERE IS A DELAY OF 718 DAYS IN FILING THE APPEALS BEF ORE THIS TRIBUNAL . ON THE QUERY FROM THE BENCH, THE LD.AR SUBMITTED THA T THE BANKS MAIN OFFICE WAS IN THE PROCESS OF SHIFT ING FROM CUFFE PARADE, MUMBAI TO BANDRA KURLA COMPLEX. THE RECORD OF THE BANK CONTAINS HUGE DATA FILES RELATED TO MORE THAN 25 D IFFERENT DEPARTMENTS. THE SHIFTING PROCESS TOOK 19 MONTHS AND HENCE, THE RECORD RELATING TO THESE APPEALS WERE NOT TRACEABLE. THE LD.AR ALSO SUBMITTED THAT THE CONCERNED MANAGER WAS ALSO RETIRED IN THE MONTH OF MAY, 2016. THEREAFTER THE BANK TOOK ADVICE FROM THE PROFESSIONAL EXPERTS AND FILED APPEALS BEFORE THIS TRIBUNAL . THE LD. AR SUBMITTED THAT IN THE PROCESS , A DELAY OF 718 IS CAUSED WHICH IS NOT INTENTIONAL AND MOTIVATED. THE LD. AR ALSO SUBMITTED THAT THE 3 CANARA BANKS ITA ALONG WITH SA ISSUE IS ALSO SETTLED BY CBDT VIDE CIRC ULAR NO.35 OF 2016 DATED 13 TH OCT, 2016. THE LD. AR IN SUPPORT OF HIS CONTENTIONS HAS FILED AFFIDAVIT DULY SWORN BY MAHESH JAGANNATH KHOLGADE, EMPLOYEE OF THE BANK. THE LD.AR SUBMITTED THAT THE ASSESSEE HAS VERY GOOD CASE ON MERITS AND THERE IS EVERY C HANCE TO SUCCEED ON MERITS. FINALLY THE LD AR PRAYED BEFORE THE BENCH THAT T HE DELAY SHOULD BE CONDONED AND APPEALS BE ADMITTED FOR ADJUDICATION. ON THE CONTRARY, THE LD.DR STRONGLY OBJECTED TO THE APPLICATION FOR CONDONATION OF DELAY. 3 . AFTER HEARING B OTH PARTIES ON THE DELAY, WE ARE SATISFIED BY THE SUBMISSIONS RENDERED BY THE LD.AR AND AFFIDAVITS PLACED BY THE LD.AR IN SUPPORT OF HIS CONTENTIONS. IN OUR CONSIDERED VIEW THE REASONS ATTRIBUTED FOR DELAY IN FILING APPEALS ARE REASONABLE AND THE DELAY DE SERVED TO BE CONDONED. ACCORDINGLY, WE CONDONE THE DELAY AND ADMIT THE APPEALS FOR ADJUDICATION . I .T.A. NOS.1742 TO 1745/MUM/2017 4 . BRIEF FACTS OF THE CASE ARE THAT ON THE INFORMATION RECEIVED , THE ASSESSEE HAS PAID LEASE PREMIUM TO MUMBAI METROPOLITAN REGIONAL DEVELOPMENT AUTHORITY (MMRDA) ON WHICH NO TDS WAS DEDUC T ED BY THE ASSESSEE. THE AO CALLED UPON THE ASSESSEE TO EXPLAIN AS TO WHY THE ASSESSEE SHOULD NOT BE TREATED AS AN ASSESSEE IN DEFAULT U/S 201(1) READ WITH SECTION 201(1A) OF THE ACT FOR NON - DEDUCTION OF TAX AT SOURCE U/S 194I OF THE ACT. DISSATISFIED WITH THE EXPLANATION SO OFFERED BY THE ASSESSEE THE ASSESSING 4 CANARA BANKS ITA ALONG WITH SA OFFICER VIDE ORDER DATED 22.3.2011 PASSED U/S 201(1)/201(1A) RAISED A DEMAND OF RS. 3,88,91,204, RS.2,45,62,500/ - , RS.1,11,56,250/ - AND RS.2,94,36,992/ - FOR THE ASSESSMENT YEARS 2009 - 10, 2010 - 11, 2011 - 12 AND 2012 - 13 RESPECTIVELY. TH ESE ORDER S WERE C HALLENGED BEFORE THE FIRST APPELLATE AUTHORITY , WHO IN TURN, DISMISSED THE CASES ON TECHNICAL GROUND THAT INCOME TAX RULES PROVIDES THAT APPEAL S MEMO WERE NOT SIGNED BY THE MANAGING DIRECTOR OF THE COMPANY . AGGRIEVED BY THE ORDER OF THE FAA, THE ASSESSEE IS IN SECOND APPEAL BEFORE THIS TRIBUNAL. 5 . THE LD.AR APPEARING FOR THE ASSESSEE SUBMITTED BEFORE US THAT THE FAA DISMISSED THE APPEAL S OF THE ASSESSEE WITHOUT GOING INTO THE MERITS OF THE CASE ON TECHNICAL GROUND THAT THE APPEAL MEMO IN FORM NO.35 WAS NOT SIGNED BY THE MANAGING DIRECTOR OF THE BANK IN TERMS OF INCOME TAX RULES, 1962. THE LD.AR FURTHER SUBMITTED THAT THE ASSESSEE HAS PAID LEASE PREMIUM TO MMRDA ON WHICH NO TDS WAS LIABLE TO BE DEDUCTED AND DEPOSITED. THE AO ON NOTICING THE SAID FACTS ISSUED SHOW CAUSE NOTICE TO THE ASSESSEE AS TO WHY THE ASSESSEE SHOULD NOT BE TREATED AS AN ASSESSEE IN DEFAULT U/S 201(1) READ WITH SECT ION 201(1A) OF THE ACT FOR NON - DEDUCTION OF TAX AT SOURCE U/S 194I OF THE ACT ON THE LEASE PREMIUM OF RS.12,61,98,033/ - , RS.12,50,00,000/ - , RS.9.37.50,000/ - AND RS.12,26,98,471/ - FOR THE ASSESSMENT YEARS 2009 - 10 TO 2011 - 12 RESPECTIVELY . THE SAID SHOW CAUS E NOTICE REPLIED BY THE ASSESSEE VIDE LETTER S DATED 9.3.2011, 19.9.2011 AND 15.3.2014 SUBMITTING THAT TDS WAS BEING DULY DEDUCTED AND DEPOSITED ON 5 CANARA BANKS ITA ALONG WITH SA THE LEASE RENT PAYMENT U/S 194I OF THE ACT BUT NO TDS WAS PAID ON THE PAYMENT OF ADDITION AL PREMIUM WHICH WAS TOWARDS THE COST OF LAND AND AS PER THE ACT , THE PROVISIONS OF TDS WERE NOT APPLICABLE TO THE SAID PAYMENT. THE LD.AR SUBMITTED THAT THE AO HAS MISCONCEIVED THE PROVISIONS OF THE ACT. 6 . WE HAVE CAREFULLY CONSIDERED THE RIVAL CONTENTIONS AND PERUSED T HE MATERIALS PLACED BEFORE US. WE FIND THAT THE ISSUE OF NON - DEDUCTION OF TAX ON PAYMENT OF ADDITIONAL PREMIUM FOR THE PAYMENT MADE BY THE ASSESSEE TOWARDS THE COST OF LAND TO MMRDA WAS NOT DISPOSED ON MERIT BY THE LD.CIT(A) WHO IN TURN DISMISSED THE APPE ALS ONLY ON THE TECHNICAL GROUND THAT THE APPEAL MEMO S IN FORM NO.35 WERE NOT SIGNED BY THE MANAGING DIRECTOR OF THE BANK. IN ALL THE FOUR YEARS, WE FIND FROM THE APPELLATE ORDERS PASSED BY THE LD.CIT(A), THE APPEALS WERE DISMISSED FOR NON SIGNING OF TH E FORM 35 BY THE MANAGING DIRECTOR OF THE BANK. UNDER THESE FACTS AND CIRCUMSTANCES OF THE CASE, WE CONSIDER IT FIT AND PROPER AND IN THE INTEREST OF JUSTICE TO RESTORE THE ISSUE BACK TO THE FILE OF THE LD.CIT(A) WITH A DIRECTION TO DECIDE THE APPEALS O N MERITS AFTER AFFORDING A REASONABLE OPPORTUNITY TO THE ASSESSEE AND THE ASSESSEE IS ALSO DIRECTED TO MAKE NECESSARY COMPLIANCE S AND COOPERATE IN THE PROCEEDINGS. ACCORDINGLY, WE SET ASIDE THE ORDERS OF LD.CIT(A) AND RESTORE THE SAME TO THE FILE OF LD.CIT (A) TO DECIDE THE ISSUE ON MERITS AFRESH. ALL THE FOUR APPEAL S ARE ALLOWED FOR STATISTICAL PURPOSES. 6 CANARA BANKS ITA ALONG WITH SA S A NOS.240 TO 243/MUM/2017 7 . SINCE WE HAVE DECIDED THE APPEALS OF THE ASSESSEE BY RESTORING THE SAME TO THE FILE OF THE LD.CIT(A) FOR FRESH DECISI ON, THE STAY APPLICATIONS ARISING OUT OF THE ABOVE FOUR APPEALS SEEKING STAY OF DEMAND RAISED BY THE AO BECOMES INFRUCTUOUS AND HENCE, THESE STAY APPLICATIONS ARE DISMISSED AS INFRUCT U OUS. 8 . IN THE RESULT, THE APPEALS OF THE ASSESSEE ARE ALLOWED FOR STATI STICAL PURPOSES AND THAT OF SAS STAND DISMISSED. S D SD ( MAHAVIR SINGH ) ( RAJESH KUMAR ) / JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI ; DATED : 12.5 .2017 SRL,SR.PS / COPY OF THE ORDER FORWARDED TO : 1. / THE APPE LLANT 2. / THE RESPONDENT 3. ( ) / THE CIT(A) 4. / CIT CONCERNED 5. , , / DR, ITAT, MUMBAI 6. / GUARD FILE T RUE COPY / BY ORDER, / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI