Elmex Electric Pvt. Ltd., Vadodara V. ACIT, CPC, TDS, Banglore

ITA 1847/AHD/2017

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 8438 (ITAT-AHMEDABAD)
• Duration Of Justice: 8 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-04-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Assessment Year: misc
• Appeal Filed On: 08-08-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: KEYUR PATEL HEARING CONCLUDED
• Section: 154

Judgement Text

ITA NOS.1844,1845,1846&1847/AHD/2017 A.YS.: 2015-16(Q-4),2016-17(Q-1),2016-17(Q-2)&2016 -17(Q-1) PAGE 1 OF 3 IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD D BENCH, AHMEDABAD [CORAM: PRAMOD KUMAR AM AND MAHAVIR PRASAD JM] ITA NOS.1844, 1845, 1846 & 1847/AHD/2017 A.YS.: 2015-16(Q-4), 2016-17(Q-1), 2016-17(Q-2) & 2 016-17(Q-1) ELMEX ELECTRIC PVT. LTD., ..................APPELLANT 12, GIDC INDUSTRIAL ESTATE, MAKARPURA, VADODARA. [PAN : AAACE 4966 E] VS. A.C.I.T., C.P.C., TDS, BANGALORE . ............................RESPONDENT APPEARANCES BY SUNIL TALATI FOR THE APPELLANT KEYUR PATEL FOR THE RESPONDENT HEARING CONCLUDED ON: 12.04.2018 ORDER PRONOUNCED ON : 18.04.2018 O R D E R PER PRAMOD KUMAR, AM: 1. BY WAY OF THESE FOUR APPEALS, THE ASSESSEE APPEL LANT HAS CHALLENGED CORRECTNESS OF THE SEPARATE ORDERS, ALL DATED 18 TH MAY, 2017, PASSED BY THE LEARNED CIT(A)-5, VADODARA, IN THE MATTER OF ASSESSMENT UND ER SECTION 154 R.W.S. 200A OF THE INCOME TAX ACT, 1961 (THE ACT HEREINAFTER), FOR T HE ASSESSMENT YEARS 2015-16(Q-4), 2016-17(Q-1), 2016-17(Q-2) & 2016-17(Q-1). 2. THESE FOUR APPEALS INVOLVE A COMMON ISSUE AND WE RE HEARD TOGETHER. AS A MATTER OF CONVENIENCE, THEREFORE, ALL THESE FOUR AP PEALS ARE BEING DISPOSED OF BY WAY OF THIS CONSOLIDATED ORDER. 3. THE COMMON GRIEVANCE RAISED BY THE APPELLANT IN ITA NO.1844/AHD/2017 2015-16(Q-4) IS AS FOLLOWS :- 1. THE ORDER PASSED BY THE HONBLE COMMISSIONER OF INCOME TAX (APPEALS)-5, VADODARA, IS BAD IN LAW, CONTRARY TO L EGAL PRONOUNCEMENT SINCE THE PROVISIONS OF SECTION 200A R.W.S. 234E ARE NOT JUST APPLICABLE IN THE CASE OF APPELLANT PARTICULARLY WHEN THE PAYMENT MADE BY THE APPELLANT IS IN NATURE ITA NOS.1844,1845,1846&1847/AHD/2017 A.YS.: 2015-16(Q-4),2016-17(Q-1),2016-17(Q-2)&2016 -17(Q-1) PAGE 2 OF 3 OF REIMBURSEMENT OF EXPENSES. HENCE IT IS SUBMITTE D THAT WHEN THERE IS NO LIABILITY TO DEDUCT THE TAX AT SOURCE, THE LEVY OF LATE FILING FEES INVOKING THE PROVISIONS OF SECTION 234E OF THE ACT IS COMPLETELY ILLEGAL AND UNJUSTIFIABLE. THE SAME BE HELD SO AND INCORRECT LEVY OF PENALTY U /S.234E OF RS.39,000/- BE DELETED. 2. THE HONBLE COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN BOTH ON FACTS AND AS WELL AS ON LAW IN CONFIRMING THE LE VY OF FEES U/S 234E OF THE ACT EVEN THOUGH APPRECIATING THE FACTS THAT INCOME HAS NEITHER ACCRUE NOR ARISEN IN INDIA AND THUS THE SAME HAS NOT BEEN LIAB LE TO BE TAXED IN INDIA. UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE, THE PROVISIONS OF SECTION 234E ARE NOT AT ALL APPLICABLE IN APPELLANTS CASE. THE SAME BE HELD NOW AND THE LATE FILING FEES LEVIED AND CONFIRMED BY THE LOWER AUTHORITIES U/S.234E OF RS.39,000/- BE DIRECTED TO BE DELETED. 4. LEARNED REPRESENTATIVES FAIRLY AGREE THAT WHATEV ER WE DECIDE IN THE ASSESSEES OWN APPEAL ITA NO.1843/AHD/2017, FOR THE ASSESSMENT YEAR 2015-16(Q-1), WHICH WE HAD HEARD ALONG WITH THESE APPEALS, WILL APPLY MUTATIS MUTANDIS FOR THESE ASSESSMENT YEARS AS WELL, AS THE ISSUE RAISED IN THESE YEARS I S IDENTICAL TO THAT OF ASSESSMENT YEAR 2015-16(Q-1). VIDE OUR ORDER OF EVEN DATE, WE HAVE ALLOWED THE APPEAL OF THE ASSESSEE, AND THE SAME RESULT MUST FOLLOW HERE AS W ELL. IN OUR SAID ORDER, WE HAVE, INTER ALIA, OBSERVED AS FOLLOWS: 3. TO ADJUDICATE ON THIS APPEAL ONLY A FEW MATERIA L FACTS NEED TO BE TAKEN NOTE OF. IT WAS A CASE IN WHICH ACIT, CPC-TDS HAS RAISED A DEMAND OF RS.38,416/- ON ACCOUNT OF SHORT DEDUCTION OF TDS ON PAYMENT OF EXHIBITION CHARGES AND IN TURN THE ASSESSING OFFICER HAS CHARG ED INTEREST OF RS.7,680/- AND LATE FILING FEES OF RS.99,800/- AS WELL AS THE STAN D OF THE ASSESSING OFFICER WAS THAT THERE IS NO TAX DEDUCTIBLE ON EXHIBITION CHARG ES PAID HAVING NO BUSINESS CONNECTION IN INDIA. IT WAS ALSO CLAIMED BY THE AS SESSEE THAT SINCE THE ASSESSEE HAS NO OBLIGATION TO DEDUCT TAX AT SOURCE THERE WAS CLEARLY NO QUESTION OF NECESSITY TO FILE TDS RETURN AND ACCORDINGLY LATE F ILING FEES UNDER SECTION 234E COULD NOT BE LEVIED. WHILE THE LEARNED CIT(A) HAS AGREED THAT THE ASSESSEE DID NOT HAVE ANY LIABILITY TO DEDUCT TAX AT SOURCE AND CONSEQUENTLY DELETED THE TAX DEMAND FOR SHORT DEDUCTION OF TDS AND INTEREST LEVI ED THEREON BUT HE UPHELD THE LEVY OF LATE FILING FEE UNDER SECTION 234E R.W.S. 2 00A OF THE ACT. THE ASSESSEE IS AGGRIEVED AND IS IN APPEAL BEFORE US. 4. WE HAVE HEARD THE RIVAL SUBMISSIONS, PERUSED THE MATERIAL ON RECORD AND DULY CONSIDERED FACTS OF THE CASE IN THE LIGHT OF T HE APPLICABLE LEGAL POSITION. 5. WE FIND THAT ONCE IT IS NOT IN DISPUTE THAT THE ASSESSEE DID NOT HAVE ANY OBLIGATION TO DEDUCT TAX FROM THE RELATED PAYMENT A ND THAT ONCE THE SAID TAX WITHHOLDING LIABILITY DID NOT SURVIVE FOR FILING OF RETURN, THERE IS CLEARLY NO BASIS FOR UPHOLDING THE LATE FILING FEES UNDER SECTION 234E O F THE ACT FOR THE DELAYED FILING OF TDS RETURN. IN THESE CIRCUMSTANCES, IN OUR CONS IDERED VIEW, THE IMPUGNED LEVY OF LATE FILING FEES UNDER SECTION 234E AMOUNTI NG TO RS.99,800/- THUS INDEED DESERVES TO BE DELETED. WE DELETE THE SAME. ITA NOS.1844,1845,1846&1847/AHD/2017 A.YS.: 2015-16(Q-4),2016-17(Q-1),2016-17(Q-2)&2016 -17(Q-1) PAGE 3 OF 3 5. RESPECTFULLY FOLLOWING THE VIEWS SO TAKEN BY US IN ASSESSEES OWN CASE IN ITA NO.1843/AHD/2017, FOR THE ASSESSMENT YEAR 2015-16(Q -1), THE ISSUE RAISED BY THE ASSESSEE IN THESE APPEALS IS ALSO ALLOWED. 6. IN THE RESULT, ALL THESE FOUR APPEALS ARE ALLOWE D. PRONOUNCED IN THE OPEN COURT TODAY ON THE 18 TH APRIL, 2018. SD/- SD/- MAHAVIR PRASAD PRAMOD KUMAR (JUDICIAL MEMBER) (ACCOUNTANT MEM BER) DATED: 18 TH APRIL, 2018 PBN/* COPIES TO: (1) THE APPELLANT (2) THE RESPONDENT (3) CIT (4) CIT(A) (5) DR (6) GUARD FILE BY ORDER ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCHES, AHMEDABAD