The ITO, TDS-4, GANDHIDHAM V. M/s. Taurus Shipping Pvt. Ltd.m, GANDHIDHAM

ITA 212/RJT/2013

• Counselvise Citation: [2015] 134 COUNSELVISE.COM (IT) 0485 (ITAT-RAJKOT)
• Duration Of Justice: 2 year(s) 5 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-10-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 06-10-2015
• Assessment Year: 2010-2011
• Appeal Filed On: 08-05-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: VIMAL I MEHTA
• Section: 201(1)

Judgement Text

I.T.A. NO. 212 /RJT/201 3 ASSESSMENT YEAR: 20 10 - 11 PAGE 1 OF 3 IN THE INCOME TAX APPELLATE TRIBUNAL RAJKOT BENCH, RAJKOT [CORAM: PRAMOD KUMAR AM AND RAJPAL YADAV JM ] I.T.A. NO. 212 /RJT/201 3 ASSESSMENT YEAR: 20 10 - 11 INCOME TAX OFFICER, . .APPELLANT TDS - 4, GANDHIDHAM. VS. TAURAS SHIPPING PVT. LTD., .. .. . RESPONDENT PLOT 326, SECTOR - 1/A, GANDHIDHAM (KUTCH). [PAN AAACT 7836 J] APPEARANCES BY: VIMAL I. MEHTA FOR THE APPELLANT KALPESH DOSHI FOR THE RESPONDENT DATE OF CONCLUDING THE HEARING : OCTOBER 6 , 2015 DATE OF PRONOUNCING THE ORDER : OCTOBER 27 , 2015 O R D E R PER PRAMOD KUMAR : 1. THE SHORT ISSUE THAT WE ARE REQUIRED TO ADJUDICATE IN THIS APPEAL IS WHETHER OR NOT THE LEARNED CIT(A), VIDE HIS IMPUGNED ORDER DATED 25 TH FEBRUARY 2013, WAS JUSTIFIED IN DELETING THE DEMANDS RAISED ON TH E ASSESSEE UNDER SECTION 201(1) AND 201(1A) R.W.S 194 J OF THE INCOME TAX ACT 1961 FOR THE ASSESSMENT YEAR 2010 - 11. 2. TO ADJUDICATE ON THIS APPEAL, ONLY A FEW MATERIAL FACTS NEED TO BE TAKEN NOTE OF. THE ASSESSEE HAD MADE CERTAIN PAYMENTS, ON ACCOUNT OF VARIOUS SERVICES IN THE NATURE OF PILOTAGE SERVICES, TO MUNDRA PORT AND ECONOMIC ZONES LIMITED MUNDRA. WHILE THE ASSESSEE DEDUCTED TAX AT SOURCE UNDER SECTION 194 C FROM THESE I.T.A. NO. 212 /RJT/201 3 ASSESSMENT YEAR: 20 10 - 11 PAGE 2 OF 3 PAYMENTS, THE ASSESSING OFFICER WAS OF THE VIEW THAT TAXES SHOULD HAVE BEEN DEDU CTED AT SOURCE UNDER SECTION 194J. IT WAS IN THIS BACKDROP THE ASSESSING OFFICER CONCLUDED THAT THERE WAS A SHORT DEDUCTION OF TAX AT SOURCE. WHILE THE ASSESSING OFFICER AGREED THAT THE DEMAND UNDER SECTION 201(1) COULD NOT BE RAISED AS NO TAXES REMAINED U NPAID BY THE DEDUCTEE, DEMANDS UNDER SECTION 201(1A) WERE RAISED IN RESPECT OF DELAYED REALIZATION OF THESE DEMANDS. WHEN THE MATTER FINALLY TRAVELLED IN APPEAL BEFORE THE CIT(A), THE DEMANDS SO RAISED WERE DELETED ON THE SHORT GROUND THAT AS THE DEDUCTEE WAS AVAILING EXEMPTION UNDER SECTION 10A AND AS THE ASSESSEE HAD INFACT CLAIMED REFUND BY FILING RETURN OF INCOME, THERE WAS NO LOSS TO THE REVENUE, AND, ACCORDINGLY, DEMANDS UNDER SECTION 201(1) AND 201(1A) COULD NOT BE LEGALLY RAISED ON THE ASSESSEE. IN COMING TO THIS CONCLUSION, LEARNED CIT(A) PLACED RELIANCE ON HON BLE SUPREME COURT S DECISION IN THE CASE OF HINDUSTAN COCA COLA BEVERAGES LIMITED VS CIT (293 ITR 266). HOWEVER, THE ASSESSING OFFICER IS AGGRIEVED OF THE RELIEF SO GRANTED BY THE CIT(A) AND IS IN APPEAL BEFORE US. 3. WE HAVE HEARD THE RIVAL CONTENTIONS, PERUSED THE MATERIAL ON RECORD AND DULY CONSIDERED FACTS OF THE CASE IN THE LIGHT OF THE APPLICABLE LEGAL POSITION. 4. WE FIND THAT IT IS NOT IN DISPUTE THAT THERE WAS NO LOSS TO THE REVENUE INASMUCH AS THE RECIPIENT OF INCOME WAS TAX EXEMPT, AND, THE RECIPIENT HAD TO INFACT CLAIM REFUND OF THE TAXES DEDUCTED AT SOURCE, RATHER THAN PAY ANY TAXES, AT THE TIME OF FILING THE INCOME TAX RETURN FOR THE RELEVANT PERIOD. UNDOUBTEDLY, THE LEVY OF SEC TION 201(1A) DOES COME INTO PLAY, WHETHER RECIPIENT OF INCOME TAX PAID THE DUE TAXES OR NOT, WHEN THERE IS A DELAY IN REALIZATION OF TAXES. FOR EXAMPLE, WHEN TAXES ARE PAID AT THE POINT OF TIME WHEN INCOME TAX RETURN IS FILED, THERE IS A DELAY IN I.T.A. NO. 212 /RJT/201 3 ASSESSMENT YEAR: 20 10 - 11 PAGE 3 OF 3 REALIZATI ON OF TAXES FOR THE PERIOD OF TIME BETWEEN THE DATE WHEN THE TAX WAS DEDUCTIBLE TILL THE TIME THE TAXES WERE PAID BY THE RECIPIENT. HOWEVER, WHEN THE ASSESSEE CLAIMS REFUND AT THE TIME OF FILING RETURN, THERE IS NO DELAY IN REALIZATION OF TAXES INASMUCH AS THESE HAVE BEEN REALIZED BEFORE THE DATE OF FILING THE INCOME TAX RETURN. IN ANY CASE, IN SUCH A SITUATION, IT IS NOT POSSIBLE TO COMPUTE THE PERIOD OF DELAY ON WHICH INTEREST UNDER SECTION 201(1A) CAN BE LEVIED. SUCH BEING THE ADMITTED FACTS, THERE WAS O BVIOUSLY NO DELAY IN REALIZATION OF THE TAXES, AND, ACCORDINGLY, DEMANDS UNDER SECTION 201(1A) COULD NOT HAVE BEEN RAISED. WE APPROVE THE CONCLUSION ARRIVED AT BY THE CIT(A) AND DECLINE TO INTERFERE IN THE MATTER. IN THIS SCENARIO, THERE IS NO NEED TO ADD RESS OURSELVES TO THE QUESTION WHETHER THE TAX WAS DEDUCTIBLE UNDER SECTION 194 C OR 194 J. THAT ASPECT OF THE MATTER IS ACADEMIC IN THE PRESENT CONTEXT. 5. IN THE RESULT, THE APPEAL IS DISMISSED. PR ONOUNCED TODAY ON 27 TH DAY OF OCTOBER, 2015 . SD/ - SD/ - RAJPAL YADAV PRAMOD KUMAR (JUDICIAL MEMBER) (ACCOUNTANT MEMBER) DATED: 27 TH DAY OF OCTOBER 2015 PBN/* COPIES TO: (1) THE APPELLANT (2) THE RESPONDENT (3) COMMISSIONER (4) CIT(A) (5) D EPARTMENTAL REPRESENTATIVE (6) GUARD FILE BY ORDER ETC ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL RAJKOT BENCH, RAJKOT