Punjab National Bank, Mehsana V. The ITO,TDS-2, Ahmedabad

ITA 245/AHD/2019

• Counselvise Citation: [2021] 104 COUNSELVISE.COM (IT) 6830 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 9 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-12-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2009-2010
• Appeal Filed On: 17-02-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Corroborative evidences; TDS; Set aside
• Section: 80C; 139; 201(1); 201; 194A

Judgement Text

आयकर अपीलीय अिधकरण, अहमदाबाद ᭠यायपीठ IN THE INCOME TAX APPELLATE TRIBUNAL, ‘’ B’’ BENCH, AHMEDABAD (CONDUCTED THROUGH VIRTUAL COURT AT AHMEDABAD) BEFORE SHRI RAJPAL YADAV, VICE PRESIDENT And SHRI WASEEM AHMED, ACCOUNTANT MEMBER आयकर अपील सं./ITA No. 245/AHD/2019 िनधाᭅरण वषᭅ/Asstt. Year: 2009-10 Punjab National Bank-Mehsana, 2, Madhuvan Complex, Highway Road, Nr. Kokila Trading, Mehsana-384001. PAN: AAACP0165G Vs. I.T.O., TDS-2, Ahmedabad. (Applicant) (Respondent) Assessee by : None Revenue by : Shri R.R. Makwana, Sr.D.R सुनवाई कᳱ तारीख/Date of Hearing : 11/11/2021 घोषणा कᳱ तारीख /Date of Pronouncement: 08/12/2021 आदेश/O R D E R PER WASEEM AHMED, ACCOUNTANT MEMBER: The captioned appeal has been filed at the instance of the Assessee against the order of the Learned Commissioner of Income Tax(Appeals)-8, Ahmedabad, dated 29/11/2018 arising in the matter of assessment order passed under s. 201(1) & 201(1A) of the Income Tax Act, 1961 (here-in-after referred to as "the Act") relevant to the Assessment Year 2009-10. ITA no.245/AHD/2019 A.Y. 2009-10 2 2. When the matter was called for hearing it was noticed that there was none appeared on behalf of the assessee despite the fact that case has been listed for hearing for more than 3 times. On the previous occasion the notice intimating the date of hearing was sent to the address of the assessee which was duly served. It is the trite law that assessee after filing the appeal should be vigilant enough to prosecute the same. But, we find that the assessee is not serious in pursuing the appeal filed by it. In the absence of any co-operation from the side of the assessee, we don’t find any reason to keep the matter pending before us. Accordingly, we decide to proceed to adjudicate the appeal after hearing the learner DR appearing on behalf of the Revenue. 3. The assessee has raised the following grounds of appeal: 1. The Ld. CIT (Appeals) has erred in law as well as on facts by passing the appellate order for TDS and interest thereon, whereas TDS is NIL 2. The Ld. CIT (Appeals) has erred in law as well as on facts by not considering the provisions of section 197(1A) r.w.s 197A(1B) wherein TDS is not applicable to the deductee declaring total income below taxable limit. 3. The Ld. CIT (Appeals) has erred in law as well as on facts by not granting the reasonable time and opportunity to submit details of deductor and deductee. 4. The Ld. CIT (Appeals] has erred in law as well as on facts by passing the order without considering the details available from the survey conducted into the office premises of the headoffice of the appellant. 5. The appellant could not respond the appeal proceedings before CIT(A) because of lack of communication and short notices. 6. The order of the CIT(A) may be set aside alongwith order of the Assessing Officer, 7. The appellant praised to grant permission for addition, deletion, amendment, or withdrawal of any of the grounds during the course of appellate proceedings. 4. The interconnected issue raised by the assessee is that the learned CIT (A) erred in confirming the order of the AO by treating the assessee in default under the provisions of section 201(1)/201 (1A) of the Act on account of non-deduction of TDS under the provisions of section 194A of the Act. ITA no.245/AHD/2019 A.Y. 2009-10 3 5. The assessee in the present case is a bank and accepting deposits from the public and paying interest to them on such deposits. The assessee in the year under consideration has paid interest to one of the party namely Shri Bipin N Shah amounting to ₹ 1,71,031/- without deducting the TDS under the provisions of section 194A of the Act. It was contended by the assessee that it has received form 15H/15G from the party and therefore no TDS was deducted in pursuance to the provisions specified under section 197A(1A) of the Act. 5.1 However, the AO was of the view that the provisions of section 197A(1A) of the Act deals with the payment of interest up-to the amount not chargeable to tax i.e. ₹ 1,50,000/- for the year under consideration. Nevertheless, interest in the given case exceeds the amount not chargeable to tax and therefore the assessee cannot be granted the immunity from the deduction of tax as provided under section 197A(1B) of the Act. Thus, the AO computed the amount of TDS which was liable to be deducted under the provisions of section 194A of the Act at ₹ 17,103/- and also computed the amount of interest on account of such delay in depositing the amount of TDS at ₹ 16,419/- aggregating to ₹ 33,522/- and raised a demand accordingly under the provisions of section 201(1) 201 (1A) of the Act. 6. Aggrieved assessee preferred an appeal to the learned CIT (A) and assailed the order of the AO on various counts including that the payee has already furnished his income tax return taking into consideration the amount of interest received from the bank. Therefore, the assessee cannot be treated as assessee in default under the provisions of section 201(1) of the Act. 7. However the learned CIT (A) disregarded the contention of the assessee by observing that there was no documentary evidence furnished about the fact that the payee has taken into consideration the amount of interest received from the ITA no.245/AHD/2019 A.Y. 2009-10 4 assessee while filing his return of income. Thus, the learned CIT (A) upheld the finding of the AO. 8. Being aggrieved by the order of learned CIT (A) the assessee is in appeal before us. 9. The assessee before us has filed the statement of facts along with the memo of appeal. It was submitted that the payee has furnished his return of income declaring an income of ₹ 1,43,320/- after claiming the deduction under section 80C/80D of the Act for ₹ 56,230/-. The return of income was filed by the payee after considering the amount of interest received from the assessee. Thus, income declared by the payee was less than the basic exemption limit provided under the Act i.e. ₹ 1,50,000/- only. Accordingly it was prayed in the statement of facts that the assessee should not be treated as assessee in default in the manner provided under section 201(1) of the Act. 10. On the contrary, the learned DR vehemently supported the order of the authorities below. 11. We have heard the rival contentions of both the parties and perused the materials available on record. The proviso to section 201(1) provides that the assessee shall not be deemed assessee in default provided if the payee has furnished the return of income under section 139 of the Act after considering the income which was subject to the provisions of TDS and paid the tax on such income. To this effect, the assessee was to furnish the certificate from the qualified chartered accountant in the prescribed form. 11.1 Admittedly, the contentions raised before us were also raised by the assessee before the learned CIT (A) but no benefit was extended by the learned CIT (A) to the assessee on the ground that the submission of the assessee was without the ITA no.245/AHD/2019 A.Y. 2009-10 5 supporting evidence. Even before us, we do not find any documents supporting the contention of the assessee except the submission as discussed in the preceding paragraph. 11.2 Indeed, it is the onus upon the assessee to furnish the CA certificates that the payee has paid necessary taxes on income credited by the assessee. However in the case on hand the assessee has submitted PAN of the payee and claimed that the payee has filed income tax return for the year dated 13-07-2009 and declared gross total income of Rs. 1,71,031/- before claiming deduction under section 80C and 80D for Rs. 56,230/- which includes interest income credited by assessee bank. The claim of the assessee bank was very much verifiable by the revenue authority from the income tax record of the payee. However none of the authorities below verified the genuineness of the claim of the assessee. We are of the view that the proviso to section 201(1) in beneficial in nature hence the same should be applied in liberal manner. In the case on hand the payee to whom interest income was credited by the assessee bank is an individual and arguably declaring very nominal income which is below the taxable limit. Thus in our understanding the fact that weather the payee has included the interest income in return of income can be easily verified. 11.3 Therefore in view of the above discussion and in interest of justice and fair play, we set aside the issue to the file of the AO with the liberty to verify the fact that weather the payee has included the interest income in his return filed for the year or not and determine the issue accordingly. Hence, the ground of appeal of ITA no.245/AHD/2019 A.Y. 2009-10 6 the assessee is allowed for the statistical purposes. 12. In the result, the appeal of the assessee is allowed for statistical purposes. Order pronounced in the Court on 08/12/2021 at Ahmedabad. Sd/- Sd/- (RAJPAL YADAV) (WASEEM AHMED) VICE PRESIDENT ACCOUNTANT MEMBER (True Copy) Ahmedabad; Dated 08/12/2021 Manish