The DCIT, 1(1), Bhopal V. M/s. Excel Freight Carriers Pvt. Ltd., Bhopal

ITA 190/IND/2014

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 5266 (ITAT-INDORE)
• Duration Of Justice: 5 year(s) 2 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-05-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 09-05-2019
• Assessment Year: 2007-2008
• Appeal Filed On: 07-03-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R S AMBEDAR
• Keywords: Retrospective amendment; Reassessment proceedings; TDS
• Section: 143(3); 40(a)(ia); 147; 148; 144; 139

Judgement Text

EXCEL FREIGHT CARRIERS PVT. LTD ITA NO.190/IND/2014 1 , , IN THE INCOME TAX APPELLATE TRIBUNAL, INDORE BENCH, INDORE BEFORE HON'BLE KUL BHARAT, JUDICIAL MEMBER AND HON'BLE MANISH BORAD, ACCOUNTANT MEMBER ITA NO.190/IND/2014 ASSESSMENT YEAR 2007-08 REVENUE BY S HRI R.S. AMBEDAR, SR.DR ASSESSEE BY S HRI ASHISH GOYAL , ADV DATE OF HEARING 0 9.05 . 201 9 DATE OF PRONOUNCEMENT 16 .0 5 . 201 9 O R D E R PER MANISH BORAD, AM. THE ABOVE CAPTIONED APPEAL PERTAINING TO ASSESSMENT YEAR 2007-08 IS FILED AT THE INSTANCE OF REVENUE AND IS DIRECTED AG AINST THE ORDERS OF LD. COMMISSIONER OF INCOME TAX (APPEALS)-I (IN SHORT L D.CIT(A)], BHOPAL DATED 24.12.2013 WHICH IS ARISING OUT OF THE ORDER U/S 147 R.W.S. 144 OF THE INCOME TAX ACT 1961(IN SHORT THE ACT) DATED 3 1.03.2012 FRAMED BY ACIT-1(1), BHOPAL. 2. REVENUE HAS RAISED FOLLOWING GROUNDS OF APPEAL; DE PUTY COMMISSIONER OF INCOME TAX 1(1), BHOPAL VS. M/S. EXCEL FREIGHT CARRIERS PVT. LTD, 186, ZONE-1, M.P.NAGAR, BHOPAL ( REVENUE ) (RESPONDENT ) PAN AABCE0344D EXCEL FREIGHT CARRIERS PVT. LTD ITA NO.190/IND/2014 2 ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE CIT(APPEALS) HAS ERRED IN 1. DIRECTING THE AO TO ALLOW THE DEDUCTION OF EXPENSES IF FINDS THAT THE APPELLANT HAD DEPOSITED THE TDS INTO THE GOVERNMENT ACCOUNT O N OR BEFORE THE DUE DATE OF FILING THE RETURN U/S 139(1) OF A.Y. 2007-08 WHE N AS PER PROVISIONS OF SEC. 40(A)(IA) OF THE ACT. 2. HOLDING THAT AMENDMENT MADE TO SEC. 40(A)(IA) MADE BY FINANCE ACT 2010 WAS DONE WITH RETROSPECTIVE EFFECT DESPITE OF ITS N OTIFICATION W.E.F. 01.04.2010. THE APPELLANT RESERVES HIS RIGHT TO ADD, AMEND OR A LTER THE GROUNDS OF APPEAL ON OR BEFORE THE DATE. 3. BRIEFLY STATED FACTS AS CULLED OUT FROM THE RECOR DS ARE THAT THE ASSESSEE IS A PRIVATE LIMITED COMPANY. ORIGINAL RE TURN OF INCOME WAS FILED ON 5.1.08 DECLARING TOTAL INCOME OF RS.24,07, 850/-. ASSESSMENT U/S 143(3) OF THE ACT WAS FRAMED ON 20.11.09 AND INCOME ASSESSED AT RS.24,57,856/-. THEREAFTER ON THE BASIS OF REASONS RECORDED IN THE NOTICE ISSUED U/S 148 OF THE ACT DATED 14.11.11, DULY SERV ED UPON THE ASSESSEE, REASSESSMENT PROCEEDINGS WERE INITIATED AND REASSES SMENT U/S 147 R.W.S. 148 R.W.S. 144 OF THE ACT WAS COMPLETED ON 30.3.201 2. WHILE FRAMING THIS ASSESSMENT ON 30.3.2012 LD. A.O MADE DISALLOWA NCE U/S 40(A)(IA) OF THE ACT AT RS.14,27,010/- FOR NON PAYMENT OF TAX D EDUCTED AT SOURCE BEFORE THE END OF PREVIOUS YEAR I.E. 31.03.2007. EXCEL FREIGHT CARRIERS PVT. LTD ITA NO.190/IND/2014 3 4. AGAINST THE DISALLOWANCE MADE U/S 40(A)(IA) OF THE ACT ASSESSEE PREFERRED APPEAL BEFORE LD. CIT(A) AND SUCCEED. LD. CIT(A) DIRECTED THE LD. A.O TO MAKE NECESSARY VERIFICATION, AS TO WHETH ER THE ASSESSEE HAD DEPOSITED THE TDS INTO THE GOVERNMENT ACCOUNT ON OR BEFORE THE DUE DATE OF FILING OF RETURN OF INCOME AND IF FOUND CORRECT THEN DELETE THE DISALLOWANCE MADE U/S 40(A)(IA) OF THE ACT. AGGRIE VED REVENUE PREFERRED APPEAL BEFORE THE TRIBUNAL BUT FAILED TO SUCCEED AS THE TRIBUNAL VIDE ORDER DATED 6.10.15 CONFIRMED THE VIEW TAKEN BY LD. CIT(A) GIVING DIRECTION TO LD. A.O TO VERIFY THE CLAIM OF THE ASS ESSEE OF HAVING DEPOSITED THE TAX DEDUCTED AT SOURCE BEFORE THE DUE DATE OF F ILING RETURN U/S 139(1) OF THE ACT ON THE EXPENSES INCURRED AT RS.12,15,13 2/-. 5. THEREAFTER THE REVENUE CHALLENGED THE TRIBUNAL O RDER BEFORE HONBLE HIGH COURT OF MADHYA PRADESH AND SUCCEED AS HONBLE COURT HELD THAT WE ALLOW THIS APPEAL, QUASH THE ORDER PASSED BY TH E TRIBUNAL FOR REMAND OF THE MATTER AND HOLD THAT THE TRIBUNAL ITSELF SHA LL DETERMINE THE QUESTION AS INDICATED IN PARAGRAPH-4 OF ITS ORDER . 6. ON THE DIRECTION OF THE HONBLE JURISDICTIONAL HIG H COURT THE MATTER WAS REMANDED BACK TO THE TRIBUNAL AND THE CASE WAS FIXED FOR HEARING. IN THE INITIAL ROUNDS OF HEARING THE ASSESSEE DID NOT FILE ANY PROOF OF EXCEL FREIGHT CARRIERS PVT. LTD ITA NO.190/IND/2014 4 PAYMENT OF TAX DEDUCTED AT SOURCE. FINALLY ON 9.5. 2019 DURING THE COURSE OF HEARING THE LD. COUNSEL FOR THE ASSESSEE PLACED COPIES OF THREE CHALLANS TOTALLING TO RS.2,29,988/- PLEADING THAT T AX DEDUCTED AT SOURCE HAS BEEN DEPOSITED BEFORE THE DUE DATE OF FILING OF RETURN OF INCOME, THEREFORE NO DISALLOWANCE WAS CALLED FOR. 7. PER CONTRA LD. DEPARTMENTAL REPRESENTATIVE VEHEMEN TLY SUPPORTING THE ORDERS OF LOWER AUTHORITIES BUT COULD NOT CONTR OVERT THE SUBMISSIONS MADE BY THE LD. COUNSEL FOR THE ASSESSEE. 8. WE HAVE HEARD RIVAL CONTENTIONS AND PERUSED THE RE CORDS PLACED BEFORE US. THE ONLY ISSUE FOR CONSIDERATION RELATE S TO DISALLOWANCE MADE U/S 40(A)(IA) OF THE ACT AT RS. 12,15,132/- FOR NON DEPOSIT OF TAX DEDUCTED AT SOURCE BEFORE THE END OF THE FINANCIAL YEAR I.E. 31.03.2007. DURING THE COURSE OF PROCEEDINGS BEFORE THE LOWER AUTHORITIES ASSESSEE DID NOT FILED ANY PROOF OF DEPOSIT ABOUT THE TAX DEDUCTED AT SOUR CE. NOW THE ASSESSEE HAS PLACED COPIES OF THREE CHALLANS SHOWING THAT RS .15,300/- PAID ON 6.9.2006 VIDE CHALLAN NO.65, RS.1,92,379/-PAID BY C HALLAN NO.164 ON 25.7.2007 AND CHALLAN OF RS.22,309/-BEARING NO.145 DEPOSITED ON 26.7.2007 AND ALL DEPOSITED WITH SBI, M.P NAGAR, BH OPAL. THE GENUINENESS OF TDS DEPOSITED AT RS.2,29,988/- TO THE GOVERNMENT EXCEL FREIGHT CARRIERS PVT. LTD ITA NO.190/IND/2014 5 TREASURY IS CERTIFIED BY THE LD. COUNSEL FOR THE AS SESSEE. THEREFORE IT IS WELL ESTABLISHED THAT THE TAX DEDUCTED AT SOURCE ON THE EXPENDITURE OF RS.12,51,152/- STANDS DEPOSITED. HOWEVER THE ALLEG ED TAX DEDUCTED HAS NOT BEEN DEPOSITED BEFORE THE END OF THE FINANCIAL YEAR BUT WELL BEFORE THE DUE DATE FILING OF RETURN OF INCOME U/S 139(1) OF T HE ACT. 9. WE OBSERVE THAT THE COORDINATE BENCH WHILE DECIDIN G THE CASE OF THE ASSESSEE IN THE FIRST ROUND RELYING ON THE JUDGMENT OF HONBLE DELHI HIGH COURT IN THE CASE OF CIT V/S NARESH KUMAR ITA NO.65 /2013 ORDER DATED 1.7.2013, HELD THAT THE AMENDMENT MADE BY THE FINAN CE ACT 2010 IN SECTION 40(A)(IA) HAS RETROSPECTIVE EFFECT AND THE APPELLANT WOULD BE ELIGIBLE FOR DEDUCTION IF TDS WAS PAID ON OR BEFORE THE DUE DATE OF FILING OF RETURN FOR ASSESSMENT YEAR 2007-08 WHICH WAS 30.09. 2007. 10 . WE THEREFORE IN VIEW OF OUR ABOVE DISCUSSION AND RESPECTFULLY FOLLOWING THE FINDING OF THE TRIBUNAL IN THE FIRST ROUND ARE OF THE CONSIDERED VIEW THAT AS THE TAX DEDUCTED ON THE EXP ENSES OF RS.12,51,132/- HAS BEEN DEPOSITED WITH THE GOVERNME NT ACCOUNT BEFORE THE DUE DATE OF FILING OF RETURN OF INCOME U/S 139 OF THE ACT NO DISALLOWANCE U/S 40(A)(IA) WAS CALLED FOR THEREFORE THE LD. CIT(A) HAS RIGHTLY DELETED THE DISALLOWANCE. EXCEL FREIGHT CARRIERS PVT. LTD ITA NO.190/IND/2014 6 11 . IN THE RESULT APPEAL OF THE REVENUE STANDS DISMIS SED. THE ORDER PRONOUNCED IN THE OPEN COURT ON 16.05.20 19. SD/- SD/- (KUL BHARAT) (MANISH BORAD) JUDICIAL MEMBER ACCOUNTANT MEMBER / DATED : 16 MAY, 2019 /DEV COPY TO: THE APPELLANT/RESPONDENT/CIT CONCERNED/CIT (A) CONCERNED/ DR, ITAT, INDORE/GUARD FILE. BY ORDER, ASSTT.REGISTRAR, I.T.A.T., INDORE