Smt. Kiran Kunwar L/H and W/o Sh. Rajendra Singh, JODHPUR V. DCIT, JODHPUR

ITA 225/JODH/2010

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 9442 (ITAT-JODHPUR)
• Duration Of Justice: 11 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-03-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 10-02-2011
• Assessment Year: 2007-2008
• Appeal Filed On: 09-04-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: NARENDRA GOUND
• Assessee Lawyers: RAJESH SURANA; N M RANKA
• Section: 234B; 201(1)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL JODHPUR BENCH, JODHPUR. BEFORE SHRI S.V. MEHROTRA, ACCOUNTANT MEMBER AND SHRI V. DURGA RAO, JUDICIAL MEMBER ITA NO.225/JU/2010 (ASSESSMENT YEAR : 2007-08) SMT. KIRAN KUNWAR, L/H AND W/O RAJENDER SINGH KHETASAR, VILL. TALIYA KHETASAR, TECH. OSIAN. PAN NO.BEQPS4060D VS. DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE 2, JODHPUR. (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI N.M. RANKA & RAJESH SURANA RESPONDENT BY : SHRI NARENDRA GOUND O R D E R PER V. DURGA RAO : THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGA INST THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS), J ODHPUR DT.11.03.2010. 2. THE EFFECTIVE GROUND OF APPEAL BY THE ASSESSEE IS THAT THE LOWER AUTHORITIES GROSSLY ERRED IN LEVYING AND CHARGING I NTEREST UNDER SECTIONS 234A, 234B & 234C OF THE INCOME TAX ACT, 1961 (THE ACT). 3. THE BRIEF FACTS IN THIS CASE ARE THAT THE ASSES SEE IS LEGAL HEIR AND WIFE OF LATE RAJENDER SINGH KHETASAR. IN THE YEAR 2006, M/S. M/S. PACL LIMITED HAD APPROACHED THE DECEASED ASSESSEE TO ASSIST M/S. PACL LIMITED IN PROCURING LAND IN DISTRICTS JODHPUR, JAISALMER, BAR MER, JALORE, BIKANER, CHURU AND NAGAUR IN THE STATE OF RAJASTHAN. LATE RAJEND RA SINGH KHETASAR HAD ENTERED INTO AN AGREEMENT WITH THE M/S. PACL LIMITE D TO PROCURE LAND FOR ITA 225/JU/2010 SMT. KIRAN KUNWAR 2 AGRICULTURAL AND HORTICULTURAL PURPOSES. THE M/S. PACL LIMITED HAS TO PAY COMMISSION FOR HIS SERVICES IN PROCURING THE LAND. LATE RAJENDRA SINGH KHETASAR HAD ENTERED INTO DIFFERENT AGREEMENTS WITH M/S. PAC L LIMITED ON 12/3/2006, 28/10/2006, 17/5/2006 AND 8/1/2008. IN PURSUANT T O THE AGREEMENTS, TO FACILITATE THE TRANSACTIONS, LATE RAJENDRA SINGH KHETASAR HAS ALSO OPENED BANK ACCOUNTS WITH HDFC BANK, ICICI BANK, IDBI BANK AND PUNJAB NA TIONAL BANK IN JODHPUR AND OPERATED WHICH OPERATION WOULD BE SUPERVISED BY M/S. PACL LIMITED AND WOULD BE PERIODICALLY FUNDED BY M/S. PACL LIMITED. ACCORDINGLY, LATE RAJENDRA SINGH KHETASAR HAS CARRIED OUT TRANSACTIONS. HE WA S DIED ON 27.10.2009 AND HIS WIFE IS THE LEGAL HEIR IN THE PRESENT PROCEEDI NGS. 4. THE ASSESSING OFFICER HAD ISSUED A NOTICE U/S.14 2(1) OF THE ACT TO THE ASSESSEE. THE ASSESSEE AFTER RECEIVING NOTICE FROM THE ASSESSING OFFICER HAD FILED THE RETURN OF INCOME ON 16.5.2008 DECLARING T OTAL INCOME OF RS.7,18,55,600/- FROM COMMISSION ON PROPERTY, BROKERAGE AND BANK INT EREST. THE ORIGINAL- ASSESSEE LATE RAJENDRA SINGH KHETASAR WAS DIED ON 2 7.10.2009 AND SUBSEQUENTLY THE LEGAL HEIR OF THE ASSESSEE HAS OFF ERED FOR TAXATION OF RS.50 LAKHS OUT OF THE EXPENSES CLAIMED BY THE ASSESSEE. ACCORDINGLY THE ASSESSING OFFICER COMPLETED THE ASSESSMENT AND ASSESSED THE TOTAL INCOME OF THE ASSESSEE AT RS.7,18,55,600/- AND CHARGED INTEREST U NDER SECTIONS 234A, 234B & 234C OF THE ACT. THE ASSESSEE HAD FILED AN APPLICA TION U/S. 154 BEFORE THE ASSESSING OFFICER AGITATING THAT CHARGING INTEREST WAS A MISTAKE APPARENT ON RECORD AND THE SAME WAS DISMISSED ON THE GROUND THA T THERE WAS NO MISTAKE ITA 225/JU/2010 SMT. KIRAN KUNWAR 3 APPARENT ON RECORD. THE ASSESSEE FILED APPEAL AGA INST THE ASSESSMENT ORDER ONLY AGAINST CHARGING OF INTEREST U/S. 234A, 234B & 234C OF THE ACT. 5. THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED B EFORE THE CIT(A) THAT THE TAX HAD TO BE DEDUCTED U/S.194(H) BY THE PRINCIPAL I.E. M/S. PACL LIMITED. THE ASSESSEE HAD NO LIABILITY TO PAY ADVANCE TAX AND DU E TO WHICH CHARGING OF INTEREST WAS NOT JUSTIFIED. IT WAS ALSO SUBMITTED BEFORE THE CIT(A) THAT THE ASSESSEE HAD NOT PAID ADVANCE TAX IN RESPECT OF TAX DEDUCTIBLE BY THE PRINCIPAL IE. M/S. PACL LIMITED ON BONA FIDE BELIEF THAT THE PRINCIPAL HAS PAID THE SAME, THEREFORE FAILURE ON THE PART OF THE PRINCIPAL I.E. M/S. PACL LIMITED, AND NOT THE ASSESSEE LIABLE TO PAY INTEREST THEREON. HOWEVER, THE LEARNED CIT(A) AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE, REJECT ED THE SAME BY OBSERVING THAT THE ASSESSEE IS RESPONSIBLE FOR MAKING THE PAY MENT OF ADVANCE TAX AND THE CASE LAWS RELIED UPON BY THE ASSESSEE DO NOT APPLY TO THE INSTANT CASE AND THE APPEAL FILED BY THE ASSESSEE WAS DISMISSED. 6. ON BEING AGGRIEVED THE ASSESSEE CARRIED THE MATT ER IN APPEAL BEFORE THE TRIBUNAL. 7. THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE INCOME RECEIVED BY THE ASSESSEE IS A COMMISSION AND THE SAME WAS AS SESSED BY ASSESSING OFFICER BY ACCEPTING IT AS COMMISSION INCOME. ONCE IT IS A COMMISSION INCOME, DEDUCTION U/S.194H APPLIES TO THE ASSESSEE. THE PR INCIPAL I.E. M/S. PACL LIMITED IS RESPONSIBLE TO DEDUCT THE TDS. FOR NON- DEDUCTION OF TDS BY THE ITA 225/JU/2010 SMT. KIRAN KUNWAR 4 PRINCIPAL, THE ASSESSEE IS NOT LIABLE TO PAY INTERE ST ON TAX. HE FURTHER SUBMITTED THAT AS PER SECTION 201(1)(D) OF THE ACT, IF THE EM PLOYER FAILS TO DEDUCT THE TAX, HE IS TO BE TREATED AS ASSESSEE IN DEFAULT. THEREFORE , HE SUBMITTED THAT THE PRINCIPAL M/S. PACL LIMITED IS A DEFAULTER AND NOT THE ASSESS EE. ACCORDINGLY, THE ASSESSEE IS NOT LIABLE TO PAY INTEREST ON ADVANCE T AX PAYABLE. THE LEARNED COUNSEL FOR THE ASSESSEE HAS RELIED ON THE SECTION 209(1)(D) OF THE ACT, WHICH IS REPRODUCED AS UNDER:- 209(1)(D):- THE INCOME-TAX CALCULATED UNDER CLAUSE (A) OR CLAUSE (B) OR CLAUSE (C) SHALL, IN EACH CASE, BE REDUCED BY TH E AMOUNT OF INCOME- TAX WHICH WOULD BE DEDUCTIBLE 12 [OR COLLECTIBLE] AT SOURCE DURING THE SAID FINANCIAL YEAR UNDER ANY PROVISION OF THIS ACT FROM ANY INCOME (AS COMPUTED BEFORE ALLOWING ANY DEDUCTIONS ADMISSIBLE UNDER THIS ACT) WHICH HAS BEEN TAKEN INTO ACCOUNT IN COMPUTING THE CURRENT INCOME OR, AS THE CASE MAY BE, THE TOTAL INCOME AFORESAID; AND THE AMOUNT OF INCOME-TAX AS SO REDUCED SHALL BE THE ADVANCE TAX P AYABLE.] 7.1 THE LEARNED COUNSEL FOR THE ASSESSEE HAS ALSO R ELIED UPON ON THE FOLLOWING CASE LAWS : I) THE MADRAS HIGH COURT IN CIT VS. MADRAS FERTILIS ERS LIMITED (149 ITR 703) AT PAGE 707, WHEREIN IT WAS HELD THAT HENCE WHERE THE STATUTE PROVIDES FOR DEDUCTION OF TAX AT SOURCE IN RESPECT OF A PARTICULAR INCOME, THE CONCERNED ASSESSEE NEED NOT PAY ANY ADV ANCE TAX IN RELATION TO THE SAID INCOME. IT FURTHER OBSERVED T HAT, WE ARE, THEREFORE, INCLINED TO HOLD THAT WHEREVER THERE IS A POSSIBILI TY OF A DEDUCTIN OF TAX AT SOURCE, THE PERSON WHO HAD FAILED TO DEDUCT TAX AT SOURCE IS LIABLE TO PAY INTEREST AND NOT THE ASSESSEE. II) IN THE CASE OF CIT VS. RANOLI INVESTMENT PVT. L TD. AND OTHERS (235 ITR 344), THE GUJARAT HIGH COURT OBSERVED AT PAGE 447 - IF THE AMOUNT OF TAX DEDUCTIBLE AT SOURCE IS NOT SO DEDUCTED BY T HE PAYER AT THE TIME OF GIVING CREDIT OR MAKING THE PAYMENT IN ANY OF TH E MODES PRESCRIBED, ITA 225/JU/2010 SMT. KIRAN KUNWAR 5 WHICHEVER BE THE EARLIER, HE ENTAILS LIABILITY UNDE R SECTION 201 TO BE TREATED AS A DEFAULTER AND, INTER ALIA, TO PAY INTE REST. THE LIABILITY TO PAY INTEREST ARISING DUE TO FAILURE TO DEDUCT THE T AX AT SOURCE AND THE LIABILITY TO PAY TAX DEDUCTIBLE AT SOURCE ARE TREA TED SEPARATELY, INASMUCH AS THE LIABILITY TO PAY INTEREST UNDER SUB -SECTION (1A) OF SECTION 201 ON ACCOUNT OF FAILURE TO DEDUCT THE TAX AT SOURCE IS MANDATORY AND SUCH PERSON HAS TO PAY INTEREST ON SU CH AMOUNT OF TAX UNTIL IT IS REALIZED BY THE REVENUE WHILE THE TAX N OT DEDUCTED AT SOURCE BECOMES THE DIRECT LIABILITY OF THE ASSESSEE. IT WAS FURTHER OBSERVED AT PAGE NO.449, THE ASSESSEE CANNOT FORESEE THAT THE T AX DEDUCTIBLE UNDER A STATUTORY DUTY IMPOSED UPON THE PAYER WILL NOT BE SO DEDUCTED. III) IN THE CASE OF ITAT IN THE CASE OF SEDCO FOREX INTERNATIONAL DRILLING INC. VS. DCIT 82 ITD 415 (AT PAGE 442) WHEREIN IT WAS HELD THAT (AT PAGE 442) THE ASSESSEE IS ENTITLED TO TAKE INTO CON SIDERATION THE AMOUNT OF TAX DEDUCTIBLE AT SOURCE DURING THE RELEV ANT FINANCIAL YEAR, FOR DECIDING WHETHER HE IS LIABLE TO PAY ANY ADVANC E TAX. IF FOR ANY REASON THE FULL AMOUNT OF TAX DEDUCTIBLE AT SOURCE HAS NOT BEEN DEDUCTED IN THE YEAR UNDER CONSIDERATION, THE APPEL LANT-COMPANY CANNOT BE FASTENED WITH THE LIABILITY TO PAY INTERE ST UNDER SECTION 234B. IV) IN THE CASE OF MOTOROLA INC. VS. DCIT (95 ITD 2 69) (MUM) (SB) AT PAGE 363 OBSERVED THAT HAVING REGARD TO THE PROVISIONS OF SECTIONS 201(1) AND 201(1A) TO WHICH OUR ATTENTION WAS DRAWN ON BEH ALF OF THE ASSESSEE, THE ASSESSEES CANNOT BE HELD TO HAVE COMM ITTED DEFAULT IN PAYING THE ADVANCE TAX. THEY ARE ENTITLED TO TAKE INTO ACCOUNT THE TAX WHICH IS DEDUCTIBLE BY THE PAYER, THOUGH NOT ACTUAL LY DEDUCTED. CONSEQUENTLY, THERE IS NO LIABILITY TO PAY INTEREST . V) IN THE CASE OF MAHINDRA AND MAHINDRA LTD. VS. D CIT (313 ITR 263) (MUM) (SB) AT PAGE 288 OBSERVED BY HARMONIOUSLY C ONSIDERING THE SCHEME OF THIS CHAPTER IN WHICH SECTION 201 FALLS, THE ONLY CONCLUSION WHICH FOLLOWS IS THAT ANY SUCH PERSON AS USED IN TH IS SECTION CANNOT BE CONSTRUED AS ONLY THE PERSON DEDUCTING AND FAILING TO DEPOSIT THE TAX ITA 225/JU/2010 SMT. KIRAN KUNWAR 6 WITH THE GOVERNMENT BUT ALSO ENCOMPASSES WITHIN ITS AMBIT THE PERSON FAILING TO DEDUCT THE TAX AT SOURCE. VI) IN THE CASE OF DIRECTOR OF INCOME TAX (INTERNA TIONAL TAXATION) VS. NGC NETWORK ASIA LLC (2009) (313 ITR 187) (BOM) OBSERVE D THAT UNDER THE PROVISIONS OF THE PRESENT ACT, THE ISSUE HAD CO ME FOR CONSIDERATION IN THE CASE OF CIT VS. SEDCO FOREX INTERNATIONAL DR ILLING CO. LTD. REPORTED IN (2003) 264 ITR 320 (UTTARANCHAL). ONE OF THE QUESTION WAS, AS TO WHETHER INTEREST COULD BE LEVIED ON THE ASSESSEE U/S.234B OF THE ACT IN RESPECT OF TAX WHICH WAS NOT LIABLE TO BE DEDUCTED AT SOURCE. A LEARNED BENCH OF THE UTTARANCHAL HIGH COU RT, AFTER CONSIDERING THE PROVISIONS, HELD AS UNDER (PAGE 328 ) : SECONDLY, ALTHOUGH SECTION 191 OF THE ACT IS NOT OVERRIDDEN B Y SECTIONS 192, 208 AND 209(1)(A)(D) OF THE ACT, THE SCHEME OF SECTIONS 208 AND 209 OF THE ACT INDICATES THAT IN ORDER TO COMPUTE ADVANCE TAX THE ASSESSEE HAS TO, INTER ALIA, ESTIMATE HIS CURRENT INCOME AND CAL CULATE THE TAX ON SUCH INCOME BY APPLYING THE RATES IN FORCE. THAT UNDER SECTION 209(1)(D) THE INCOME TAX CALCULATED IS TO BE REDUCED BY THE AMOU NT OF TAX WHICH WOULD BE DEDUCTIBLE AT SOURCE OR COLLECTIBLE AT SOU RCE, WHICH IN THIS CASE HAS NOT BEEN DONE BY THE EMPLOYER COMPANY ACCO RDING TO THE LAW PREVAILING FOR WHICH THE ASSESSEE CANNOT BE FAU LTED. RELYING ON THE JUDGMENT IN SEDCO FOREX INTERNATIONAL DRILLING CO. LTD. (2003) 264 ITR 320 (UTTARANCHAL), A LEARNED BENCH OF THIS COUR T WAS PLEASED TO PASS AN ORDER DATED JULY 16, 2008IN INCOME TAX APPE AL (L) NO.1796 OF 2007 IN THE CASE OF THE DIRECTOR OF INCOME TAX (INT ERNATIONAL TAXATION) VS. MORGAN CORPORATION GUARANTEE INTERNATIONAL FINA NCE CORPORATION, BY APPLYING THE RATIO OF THAT JUDGMENT. OUR ATTENTION IS ALSO INVITED TO THE JUDGMENT OF T HE MADRAS HIGH COURT, IN THE CASE OF CIT VS. MADRAS FERTILISERS LT D. REPORTED IN (1984) 149 ITR 703, WHERE THE MADRAS HIGH COURT TOOK THE V IEW THAT THE AMOUNT OF TAX DEDUCTIBLE AT SOURCE IS TO BE TAKEN I NTO CONSIDERATION TO ITA 225/JU/2010 SMT. KIRAN KUNWAR 7 DETERMINE THE LIABILITY TO PAY THE INTEREST UNDER S ECTION 215. IN THAT CASE, THE ASSESSEE HAD NOT PAID ADVANCE TAX ON THE INTEREST INCOME. THE PAYER OF INTEREST HAD NOT DEDUCTED THE TAX. TH E LEARNED BENCH OF THE MADRAS HIGH COURT WAS OF THE VIEW THAT LEVY OF INTEREST UNDER SECTION 215 ON THE ASSESSEE WAS NOT JUSTIFIED. WE A RE IN RESPECTFUL AGREEMENT WITH THE VIEW TAKEN IN THE CASE OF CIT VS . SEDCO FOREX INTERNATIONAL DRILLING CO. LTD. (2003) 264 ITR 320, BY THE UTTARANCHAL HIGH COURT. WE ARE CLEARLY OF THE OPINION THAT WHE N A DUTY IS CAST ON THE PAYER TO PAY THE TAX AT SOURCE, ON FAILURE, NO INTEREST CAN BE IMPOSED ON THE PAYEE-ASSESSEE. CONSIDERING THE SUBMISSIONS OF BOTH PARTIES AND THE PROVISIONS OF LAW, CONSEQUENTLY THE APPEAL IS DISMISSED. 8. ON THE OTHER HAND, THE LEARNED DEPARTMENTAL REPR ESENTATIVE HAS SUBMITTED THAT THE ASSESSEE HAS RECEIVED CHEQUES FR OM M/S. M/S. PACL LIMITED WHICH IS POINTED OUT FROM THE PAPER BOOK PAGE NOS.1 1 TO 15, ALL THE AMOUNTS ARE ROUND FIGURES, THEREFORE, IT CANNOT BE SAID THAT TH E PRINCIPAL I.E. M/S. PACL LIMITED DEDUCTED THE TAX AT SOURCE. THE LEARNED D EPARTMENTAL REPRESENTATIVE FURTHER SUBMITTED THAT THE ASSESSEE HAS NOT MADE AN Y REASONABLE ENQUIRY WHETHER M/S. PACL LIMITED MADE THE TDS OR NOT. EVE N THE ASSESSEE HAS NOT PAID THE TAX VOLUNTARILY. HE PAID THE TAX ONLY AFTE R THE NOTICE U/S.142(1) OF THE ACT ISSUED BY THE ASSESSING OFFICER. IT SHOWS THAT THE CONDUCT OF THE ASSESSEE THAT HE IS NOT READY TO PAY THE TAX VOLUNTARILY. THE LE ARNED DEPARTMENTAL REPRESENTATIVE HAS POINTED OUT FROM THE PAPER BOOK AT PAGE NO.10 AND SUBMITTED THAT M/S. PACL LIMITED ISSUED LETTER DT. 24.11.2009 IN WHICH IT WAS STATED THAT NO COMMISSION IS BEING PAID TO THE PART Y AS THE PARTY HAS NOT ITA 225/JU/2010 SMT. KIRAN KUNWAR 8 COMPLETED THE TERMS AND CONDITIONS OF THE AGREEMENT . THE COMPANY HAS ALREADY FILED A SUIT FOR THE RECOVERY OF THE ABOVE AMOUNT O N ACCOUNT OF NON-COMPLIANCE OF THE TERMS AND CONDITIONS OF THE CONTRACT/MOU. HE H AS SUBMITTED THAT THE ASSESSEE IS LIABLE TO PAY ADVANCE TAX AND FAILED TO PAY THE SAME, THEREFORE, THE ASSESSING OFFICER HAS RIGHTLY IMPOSED THE INTEREST THEREOF. AS PER THE SECTION 191 OF THE ACT, WHEN THE TDS WAS NOT DEDUCTED, IT IS TH E DUTY OF THE ASSESSEE TO PAY THE TAX. THE ASSESSEE KNOWS THAT THE PRINCIPAL M/S . PACL LIMITED NOT DEDUCTED THE TDS, THEREFORE, IT IS THE DUTY OF THE ASSESSEE TO PAY THE ADVANCE TAX. SECTION 234B IS A MANDATORY AND THE COLLECTION OF INTEREST UNDER THIS SECTION IS COMPENSATORY IN NATURE. HE SUPPORTED THE ORDERS OF BOTH THE AUTHORITIES BELOW. 9. WE HAVE HEARD BOTH THE SIDES, PERUSED THE RECORD S AND GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW. THE DISPUTE INVOL VED IN THIS APPEAL IS WHETHER THE ASSESSEE IS LIABLE TO PAY INTEREST U/S. 234A,B, C ON THE AMOUNT OF WHICH TDS HAS TO BE DEDUCTIBLE BY THE PRINCIPAL M/S. PACL LIM ITED OR NOT. THE CASE OF THE ASSESSEE IS THAT THE ASSESSEE IS A LAND BROKER AND HE HAS ASSISTED TO M/S. PACL LIMITED FOR THE PURPOSE OF PROCURING THE LAND AND H E RECEIVED THE COMMISSION FOR THE SERVICES RENDERED AND FOR THAT HE HAS ENTERED VARIOUS AGREEMENTS WITH THE M/S. PACL LIMITED. THE ASSESSEE HAS OFFERED THE AM OUNT RECEIVED FROM M/S. PACL LIMITED AS THE COMMISSION AND THE SAME WAS ACC EPTED BY THE ASSESSING OFFICER. HOWEVER, THE PRINCIPAL I.E. M/S. PACL LIM ITED DENIED THE PAYMENT OF COMMISSION TO THE ASSESSEE. AS PER THE AGREEMENT D ATED 12/03/06, WHICH IS ENCLOSED IN THE PAPER BOOK, WHEREIN CLAUSE (2) OF T HE AGREEMENT STATES THAT THE ITA 225/JU/2010 SMT. KIRAN KUNWAR 9 SAID COMMISSION/SERVICE CHARGES SHALL BE PAID/SETTL ED IN PROPORTION TO THE ACTUAL REGISTRATION OF RESPECTIVE AGRICULTURE LANDS AT THE TIME OF REGISTRATION OF SALE DEED AND CLAUSE (10) OF THE AGREEMENT STATES THAT THE PURCHASE/PROCUREMENT OF AGRICULTURE LANDS SHALL BE SUBJECT TO ITS CLEAR TIT LE & FREE MARKETABILITY TO THE ENTIRE SATISFACTION OF FIRST PARTY. FIRST PARTY HAS AGREED TO GIVE 25% ADVANCE TO PURCHASE TOKEN & 25% ADVANCE COMMISSION SECOND PART Y FOR FIXING AGRICULTURE LAND FROM KHATEDARS AT THE TIME OF MOU. UNDER THESE CIRCUMSTANCES, IT IS NECESSARY TO EXAMINE THE AGREEMENT ENTERED WITH M/S . PACL LIMITED AND THE DETAILS IN RESPECT OF LAND PROCURED BY THE ASSESSEE FOR M/S. PACL LIMITED AND THE COMMISSION RECEIVED BY THE ASSESSEE. BEFORE US ONLY ONE AGREEMENT DATED 12/03/06 WAS FILED. THERE ARE FOUR AGREEMENTS AND T HE SAME WERE NEITHER EXAMINED BY THE ASSESSING OFFICER NOR BY THE CIT(A) . NO MATERIAL ON RECORD IS THERE TO CONCLUDE EITHER WAY WHETHER THE AMOUNTS D ISPUTED BY THE PRINCIPAL I.E. M/S PACL LTD. IN THE BANK ACCOUNT OF THE ASSESSEE I NCLUDES COMMISSION PAYMENTS OR NOT. THERE IS NO CORRESPONDENCE IN THI S REGARD ON RECORD EXCEPT ONE AGREEMENT. UNDER SUCH CIRCUMSTANCES, WE ARE OF THE OPINION THAT A DETAILED SCRUTINY IS REQUIRED BEFORE ARRIVING AT A PROPER C ONCLUSION. THEREFORE, THE FACTS ARE REQUIRED TO BE RE-MARSHALLED THOROUGHLY AND THE ABOVE AGREEMENTS/DETAILS ARE NECESSARY TO BE EXAMINED IN THE LIGHT OF SPECIF IC DENIAL OF THE PAYMENT OF THE COMMISSION BY THE PRINCIPAL I.E. M/S PACL LTD.. IF THE ASSESSEE IS RECEIVED COMMISSION IN ACCORDANCE WITH THE AGREEMENTS, IT WA S THE DUTY OF THE M/S. PACL LIMITED TO DEDUCT THE TDS UNDER SECTION 194(H) OF T HE ACT. IN VIEW OF THE ABOVE DISCUSSION, WE SET ASIDE THE ORDER OF CIT(A) RELATI NG TO THE LEVY OF INTEREST U/S ITA 225/JU/2010 SMT. KIRAN KUNWAR 10 234A, 234B AND 234C OF THE ACT AND REMIT THE MATTER BACK TO THE FILE OF THE ASSESSING OFFICER FOR THE LIMITED PURPOSE TO ADJUDI CATE THE ISSUE RELATING TO THE LEVY OF INTEREST U/S 234A, 234B & 234C OF THE ACT, IN THE LIGHT OF THE REASONS MENTIONED ABOVE AFTER GIVING REASONABLE OPPORTUNITY TO THE ASSESSEE. THE GROUND TAKEN BY THE ASSESSEE ON THIS ISSUE IS ALLOW ED FOR STATISTICAL PURPOSES. 10. IN THE RESULT THE APPEAL OF ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. PRONOUNCED ON 25 TH MARCH, 2011. SD/- SD/- (S.V. MEHROTRA) (V. DURGA RAO) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DT. 25 TH MARCH, 2011. *GPR COPIES OF THE ORDER FORWARDED TO : (1) THE APPELLANT (2) THE RESPONDENT (3) CIT, MUMBAI (4) CIT(A), MUMBAI (5) DR, (6) GUARD FILE TRUE COPY BY ORDER ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES ITA 225/JU/2010 SMT. KIRAN KUNWAR 11 DATE INIT IALS DRAFT DICTATED ON 14.03.2011. DRAFT PLACED BEFORE AUTHOR DRAFT PROPOSED & PLACED BEFORE SECOND MEMBER DRAFT DISCUSSED & APPROVED BY SECOND MEMBER APPROVED DRAFT COMES TO SR.PS/PS KEPT FOR PRONOUNCEMENT ON FILE SENT TO BENCH CLERK DATE ON WHICH FILE GOES TO THE HEAD CLERK DATE OF DISPATCH OF ORDER.