Bharat Sanchar Nigam Ltd., Rewari V. ITO (TDS), Rohtak

ITA 194/DEL/2012

• Counselvise Citation: 19420114 RSA 2012
• Duration Of Justice: 2 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-03-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 14-03-2012
• Assessment Year: misc
• Appeal Filed On: 12-01-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ANOOP KUMA R SINGH
• Section: 201(1)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL DELHI DELHI DELHI DELHI BENCH A BENCH A BENCH A BENCH A : NEW DELHI : NEW DELHI : NEW DELHI : NEW DELHI BEFORE SHRI G. BEFORE SHRI G. BEFORE SHRI G. BEFORE SHRI G.D.AGRAWAL, D.AGRAWAL, D.AGRAWAL, D.AGRAWAL, VICE PRESIDENT AND VICE PRESIDENT AND VICE PRESIDENT AND VICE PRESIDENT AND SHRI SHRI SHRI SHRI CHANDRA MOHAN GARG CHANDRA MOHAN GARG CHANDRA MOHAN GARG CHANDRA MOHAN GARG, JUDICIAL MEMBER , JUDICIAL MEMBER , JUDICIAL MEMBER , JUDICIAL MEMBER ITA NO ITA NO ITA NO ITA NOS.193/DEL/2012 TO 198/DEL/2012 S.193/DEL/2012 TO 198/DEL/2012 S.193/DEL/2012 TO 198/DEL/2012 S.193/DEL/2012 TO 198/DEL/2012 ASSESSMENT YEAR ASSESSMENT YEAR ASSESSMENT YEAR ASSESSMENT YEARS : 2003 S : 2003 S : 2003 S : 2003- -- -04 TO 2008 04 TO 2008 04 TO 2008 04 TO 2008- -- -09 0909 09 M/S BHARAT SANCHAR NIGAM M/S BHARAT SANCHAR NIGAM M/S BHARAT SANCHAR NIGAM M/S BHARAT SANCHAR NIGAM LIMITED, LIMITED, LIMITED, LIMITED, O/O GMTD, REWARI. O/O GMTD, REWARI. O/O GMTD, REWARI. O/O GMTD, REWARI. PAN : RTKBO1507C. PAN : RTKBO1507C. PAN : RTKBO1507C. PAN : RTKBO1507C. VS. VS. VS. VS. INCOME TAX OFFICER (TDS), INCOME TAX OFFICER (TDS), INCOME TAX OFFICER (TDS), INCOME TAX OFFICER (TDS), ROHTAK. ROHTAK. ROHTAK. ROHTAK. (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI NAVEEN KUMAR GOYAL, CA. RESPONDENT BY : SHRI ANOOP KUMAR SINGH, DR. ORDER ORDER ORDER ORDER PER G. PER G. PER G. PER G.D.AGRAWAL, D.AGRAWAL, D.AGRAWAL, D.AGRAWAL, VP VPVP VP : : : : THESE APPEALS BY THE ASSESSEE ARE FILED AGAINST THE CONSOL IDATED ORDER OF LEARNED CIT(A), ROHTAK DATED 17 TH OCTOBER, 2011 FOR THE AY 2003-04 TO 2008-09. 2. SINCE COMMON ISSUE IS INVOLVED IN ALL THESE APPEALS, THE SAME ARE BEING DISPOSED OF BY THIS CONSOLIDATED ORDER FOR T HE SAKE OF CONVENIENCE. 3. THE GROUNDS TAKEN BY THE ASSESSEE IN ALL THESE APPEAL S ARE IDENTICAL. WE REPRODUCE THE GROUNDS RAISED IN ITA NO .193/DEL/2012 AS UNDER:- 1. THE CIT(A) HAS ERRED IN LAW AND ON FACTS IN TREAT ING THE APPELLANT AS ASSESSEE IN DEFAULT U/S 201(1) & 201(1A ) OF THE IT ACT AND RAISING DEMAND OF RS.12,90,280/-. 2. THE CIT(A) HAS ERRED IN LAW AND ON FACTS IN IGNORI NG THE PROVISIONS OF SECTION 194H OF THE I.T.ACT, 1956 DE SPITE ITA-193 TO 198/DEL/2012 2 OF THE FACT THAT AMENDMENT BROUGHT IN THE SECTION 19 4H W.E.F. 01.06.2007, IS OF A CLARIFYING NATURE ONLY TO REMOVE THE HARDSHIP FACED BY THE BSNL/MTNL, STD/PCO FRANCHISE S AND THE DEPARTMENT ITSELF, WHICH IS EVIDENT FROM THE CBD T CIRCULAR/INSTRUCTION, COMMENTARY ON BUDGET 2007 FINA NCE BILL, FINANCE MINISTER LETTER TO TELECOM MINISTER. 3. THE CIT(A) HAS ERRED IN LAW AND ON FACTS IN NOT CONSIDERING THE CIRCULARS ISSUED BY THE CENTRAL BOARD O F DIRECT TAXES (CBDT) REGARDING DEDUCTION OF TDS U/S 19 4H FROM STD/PCO FRANCHISES OF THE BSNL, WHICH ARE BINDIN G ON THE INCOME TAX AUTHORITIES. 4. THE CIT(A) HAS ERRED IN LAW IN DISREGARDING THE BINDING JUDICIAL PRECEDENT DELIVERED BY HONBLE JURISDICTIONAL ITAT DELHI, B BENCH, DELHI IN THE C ASE OF ITO(TDS) GURGAON VS. BSNL, GMTD GURGAON, VIDE ITA NO.3996/D/2004. 5. THE CIT(A) HAS ERRED IN LAW AND ON FACTS IN IGNORI NG THE FACT THAT DEMAND U/S 201(1) & 201(1A) MUST BE RAI SED WITHIN A REASONABLE TIME. 4. AT THE OUTSET, THE LEARNED COUNSEL FOR THE ASSESSEE SUB MITTED THAT THE ISSUE INVOLVED IN THE PRESENT APPEALS IS COVER ED IN FAVOUR OF THE ASSESSEE BY THE ORDER OF ITAT, PUNE BENCH DATED 7 TH DECEMBER, 2011 RENDERED IN ASSESSEES OWN CASE IN ITA NOS.983 & 984/ PN/2010 FOR THE AY 2006-07 & 2007-08. HE HAS PLACED ON RECO RD THE COPY OF THE SAID ORDER OF THE TRIBUNAL. HE SUBMITTED THAT TH E AUTHORITIES BELOW HAVE ERRED IN TREATING THE ASSESSEE IN DEFAULT UNDER SE CTION 201(1) AND 201(1A) AND IN MAKING ADDITIONS. HE FURTHER RELIED UPON THE CBDT INSTRUCTION NO.3 DATED 8.5.2009 AND CONTENDED THAT I T HAS BEEN CLARIFIED IN THE SAID INSTRUCTION THAT RECOVERY OF TD S UNDER SECTION 194H ON COMMISSION PAID BY BSNL AND MTNL TO THEIR STD -PCO FRANCHISEES MAY NOT BE ENFORCED BY THE FIELD FORMATIO NS AND ONLY WHERE THEY HAVE ALREADY DEDUCTED TDS ON COMMISSION PA ID TO PCO OWNERS, DIRECTED TO DEPOSIT THE SAME IN THE GOVERNMENT ACCOUNT. ITA-193 TO 198/DEL/2012 3 5. THE LEARNED DR, ON THE OTHER HAND, SUPPORTED THE ORDERS OF AUTHORITIES BELOW. 6. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED TH E MATERIAL PLACED BEFORE US. WE FIND THAT THE ISSUE INVOLVED IN THE PRESENT APPEALS IS COVERED IN FAVOUR OF THE ASSESSEE BY THE ORDER OF THE TRIBUNAL DATED 7 TH DECEMBER, 2011 (SUPRA) PASSED IN ASSESSEES OWN CASE FOR AY 2006-07 & 2007-08. IN THE SAID ORDER, TH E ITAT PUNE BENCH HAS FOLLOWED THE EARLIER ORDER OF THE TRIBUNAL IN ASSE SSEES OWN CASE IN ITA NOS.71 TO 77/PN/2009 FOR THE AY 2002-03 AND 2008 -09, AND HELD THAT THE AMENDMENT BROUGHT IN SECTION 194H IS ONLY C LARIFICATION IN NATURE. THE RELEVANT PORTION OF THE SAID ORDER IS RE PRODUCED BELOW :- 5. FROM THE ABOVE, IT IS EVIDENT THAT THE FINANCE A CT, 2007 HAS INCORPORATED THIRD PROVISO TO SECTION 194H STATING, NO DEDUCTION SHALL BE MADE UNDER THIS SECTION OF ANY COMMISSION OR BROKERAGE PAYABLE BY BSNL OR MTNL T O THEIR PCO FRANCHISEES. THE SAME IS RELEVANT FOR THE A .Y. 2008-09. THE ISSUE IS WHETHER SIMILAR EXEMPTION IS APPLICABLE FOR THE ASSESSMENT YEAR PRIOR TO THE ASSESSMENT YEAR 2008-09. THIS ISSUE WAS ADJUDICATED IN FAVOUR OF THE ASSESSEE BY CO-ORDINATE BENCH OF THIS TRIBUNAL IN ASSESSEES OWN CASE IN ITA NO.71 TO 77/PN/2009. IT HAS TAKEN SUPPORT FROM THE ORDER OF THE TRIBUNAL IN THE CASE OF ITO VS. ACCOUNTS OFFICER, BSNL (ITA NO.3996/DEL/2004) . CONSIDERING THE EXACT NATURE OF THE ISSUE, WE ARE OF T HE OPINION THAT THE CIT(A) WAS JUSTIFIED IN CANCELLING T HE ORDERS OF THE A.O. U/S 201 AND 201(1A) FOR THE YEARS UNDER CONSIDERATION. ITA-193 TO 198/DEL/2012 4 7. RESPECTFULLY FOLLOWING THE AFORESAID ORDER OF THE ITAT IN ASSESSEES OWN CASE, WE HOLD THAT THE AUTHORITIES BELOW HA VE ERRED IN TREATING THE ASSESSEE IN DEFAULT UNDER SECTION 201(1)( AND 201(1A). ACCORDINGLY, WE REVERSE THE ORDERS OF AUTHORITIES BELO W AND ALLOW THE APPEALS FILED BY THE ASSESSEE. 8. IN THE RESULT, THE APPEALS OF THE ASSESSEE ARE ALLOWED . DECISION PRONOUNCED IN THE OPEN COURT ON 23 RD MARCH, 2012. SD/- SD/- ( (( (CHANDRA MOHAN CHANDRA MOHAN CHANDRA MOHAN CHANDRA MOHAN GARG GARG GARG GARG) )) ) (G.D.AGRAWAL) (G.D.AGRAWAL) (G.D.AGRAWAL) (G.D.AGRAWAL) JUDICIAL JUDICIAL JUDICIAL JUDICIAL MEMBER MEMBER MEMBER MEMBER VICE PRESIDENT VICE PRESIDENT VICE PRESIDENT VICE PRESIDENT DATED : 23.03.2012 VK. COPY FORWARDED TO: - 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR, ITAT ASSISTANT REGISTRAR