Rajendra Singh, Bareilly V. Income Tax Officer (TDS), Bareilly

ITA 231/LKW/2022

AI Insights

The case revolves around the non-deduction of TDS on the purchase of immovable property by Rajendra Singh, where the purchase consideration was allegedly above Rs. 50,00,000. The Assessing Officer (AO) initially passed an order under section 201 of the Income Tax Act for non-deduction of TDS under section 194IA. However, the Commissioner of Income Tax (Appeals) later found that the actual consideration was only Rs. 40,00,000, below the required threshold for TDS deduction. Despite this finding, the CIT(A) set aside the issue for re-examination by the AO, which led to the assessee appealing to the Tribunal.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 123085 (ITAT-LUCKNOW)
• Duration Of Justice: 3 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-04-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 16-04-2023
• Assessment Year: 2017-2018
• Appeal Filed On: 21-12-2022
• Other Referred Cases: Shri Tej Pal (Appeal No. CIT(A), Bareilly/10049/2018-19 dated 15/05/2018
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: HARISH GIDWANI
• Keywords: TDS; Set aside
• Section: 201

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH “SMC”, LUCKNOW BEFORE SHRI SUDHANSHU SRIVASTAVA, JUDICIAL MEMBER ITA No.231/LKW/2022 A.Ys. 2017-18 Income Tax Office (TDS), Aaykar Bhawan, Kamla Nehru Marg, Bareilly-243001 Vs. Rajendra Singh, S/o Shri Laxmi Narayan Mundiya Ahmad Nagar, Bareilly U.P. 243122 PAN GQNPS1049Q (Respondent) (Appellant) None Appellant by Shri Harish Gidwani, DR Respondent by 17/04/2023 Date of hearing 19/04/2023 Date of pronouncement O R D E R This appeal is preferred by the assessee against the order dated 28.02.2020 passed by Commissioner of Income Tax (Appeals), Bareilly for A.Y. 2017-18. 2. The brief facts of the case are that an order u/s. 201 of the Income Tax Act, 1961 (hereinafter called ‘the Act’) was passed for non deduction of TDS u/s. 194IA of the Act on purchase of immovable property for Rs.83,82,000/-. As per the Assessing Officer, TDS @1% was required to be deducted u/s. 194IA of the Act as purchase consideration was more than Rs.50,00,000/-. 3. Although, the assessee could not explain the facts before the AO (TDS), before the ld. CIT(A), it was submitted that the actual purchase consideration was only Rs.40,00,000/- and the confusion had arisen as the value of the property as per the circle rate was Rs.83,82,000/-. It was submitted before the ld. CIT(A) that since the purchase consideration was below Rs.50,00,000/-,. the assessee was not under any legal obligation to deduct tax at source. The 2 ITA No. 231/Lkw/2022 assessee also submitted a copy of purchase deed to establish his contention. The ld.CIT(A), in Para 4 of the impugned order, has given a categorical finding that the actual sales consideration as per the sale deed was only Rs.40,00,000/- and the confusion had arisen as the value of the property as per the circle rate was Rs.83,82,000/-, which was also evident from the sale deed. The ld. CIT(A) further noted that since the sales consideration was less than Rs.50,00,000/-, there was no requirement of deduction of TDS @ 1% in terms of Section 194IA. However, the ld. CIT(A), thereafter, set aside the issue to the file of the Assessing Officer to examine the issue afresh. 4. Aggrieved with the order of the ld. CIT(A), the assessee has now approached this Tribunal, challenging the impugned order by raising the following grounds of appeal: “1. That the appellate order is bad in law as well as on the facts and circumstances of the case. 2. That the Ld. CIT (Appeals), Bareilly has erred in law that appellant did not produce the copy of sale deed accompanied with stamp valuation to show that the property discussed in the case of Shri Tej Pal (Brother) was same as in the case of the appellant. 3. That the property was jointly purchased by the appellant with his brother Mr. Tej Pal and appellant relied upon the decision of the Ld. CIT(A) in the case of Shri Tej Pal (Appeal No. CIT(A), Bareilly/10049/2018-19 dated 15/05/2018 in which relief was given that actual sale consideration was only Rs. 40,00,000/- as per sale deed whereas Circle rate was Rs.83,82,000/- Appellant is enclosing the order of same 4. That the appellant is enclosing the copy of sale deed which clearly state that the sale consideration was merely Rs. 40,00,000/- and not Rs. 83,82,000/- as such appellant is not liable to deduct TDS from the payment made as per requirement of Section 194Al of Income Tax Act, 1961. 5. Any other ground as deem fit at the time of hearing of appeal.” 3 ITA No. 231/Lkw/2022 5. None was present on behalf of the assessee when the appeal was called out for hearing nor was any adjournment application received. However, looking into the facts of the case, I deem it appropriate to hear the appeal on merits ex-parte qua the assessee. 6. It is also seen that there is a delay of 30 days in filing of this appeal before ITAT. In this regard, it is seen that the assessee has filed an affidavit wherein it has been deposed that the appeal could not be filed in time due to his ill health. Medical certificate in original has also been filed in support of his plea that the appeal could not be filed within the stipulated time due to his ill health. 7. The ld. Sr. DR also does not have any objection in the delay being condoned. 8. A perusal of the order of the ld. CIT(A) shows that the ld. CIT(A) has given a categorical finding that the actual sales consideration was only Rs.40,00,000/-, which was evident from the sale deed and since the sales consideration was less than Rs.50,00,000/-, there was no requirement of deduction of tax at source u/s. 194IA. Thus, in effect, the ld. CIT(A) has accepted the submission of the assessee. However, he has wrongly chosen to set aside the issue to the file of the Assessing Officer for the purpose of reexamination. Such a set aside does not have any logic or reasoning behind it. 9. The ld. Sr. DR has been fair enough to accept that the appeal could have been disposed of in favour of the assessee by the ld.CIT(A) himself. Under such circumstances, I see no reason to uphold the order of the ld. CIT(A) and I set aside the order of the ld. CIT(A). Further, on the facts and 4 ITA No. 231/Lkw/2022 circumstances of the case, I hold that the assessee was not liable to deduct tax at source. 10. In the result, appeal of the assessee stands allowed. (Order pronounced in the open court on 19/04/2023) Sd/- (SUDHANSHU SRIVASTAVA) JUDICIAL MEMBER Aks – Dtd. 19/04/2023 Copy of order forwarded to: (1) The appellant (2) The respondent (3) Commissioner (4) Departmental Representative (5) Guard File By order Assistant Registrar