KIRTI M SHAH, Mumbai V. DCIT/ACIT,CPC, BANGALORE-DCIT 8(1)(1), Mumbai

ITA 2528/MUM/2022

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The case involves Kirti M Shah, a senior citizen and individual taxpayer, who appealed against the order of the National Faceless Appeals Centre (NFAC), which confirmed the charging of interest under sections 234B and 234C of the Income Tax Act, 1961, for the assessment year 2018-19. The primary contention was that the assessee, being a senior citizen with no business income, was not liable to pay advance tax and consequently, the interest charged was erroneous. The Tribunal examined the applicability of section 207 of the Act, which exempts certain senior citizens from advance tax payments, and found that the assessee was incorrectly charged interest under sections 234B and 234C.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 123709 (ITAT-MUMBAI)
• Duration Of Justice: 5 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-03-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: H
• Next Hearing Date: 09-01-2023
• Assessment Year: 2019-2020
• Appeal Filed On: 27-09-2022
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Business income; TDS
• Section: 154; 234B; 250; 207; 208; 139(1)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH “H”, MUMBAI BEFORE SHRI VIKAS AWASTHY, JUDICIAL MEMBER AND SHRI GAGAN GOYAL, ACCOUNTANT MEMBER ITA No. 2528/Mum/2022 (A.Y. 2019-20) Kirti M Shah, D1, Alpha Apartment, Sir Pochkanwala Road, Mumbai-400 030. PAN: AUKPS2956H ...... Appellant Vs. DCIT/ACIT, CPC, Aayakar Bhavan, Mumbai-400 020 ..... Respondent Appellant by : Sh. Bhupendra Shah Respondent by : Sh. Tejinder Pal Singh Anand, Sr. DR Date of hearing : 10/01/2023 Date of pronouncement : 21/03/2023 ORDER PER GAGAN GOYAL, A.M: This appeal by assessee is directed against the order of National Faceless Appeals Centre, Delhi (for short ‘NFAC’) dated 20.08.2022 under section 250 of the Income Tax Act, 1961 (for short ‘the Act’) for A.Y. 2018-19. The assessee has raised the following grounds of appeal: “1. AO in the fact and circumstances of the case in law, the A.O erred in charging interest u/s 234 B & 234C of Rs 1,45,533/- by disregarding the fact that the 2 ITA No. 2528/Mum/2022-Kirti M Shah Appellant is a senior citizen having no business income and therefore no liable to pay advance tax and interest u/s 234B & 234C, 2. In facts and circumstances of the case in law the erred in rejecting application u/s 154 even though this is a mistake apparent from record. 3. In the facts and circumstances of the case and in law, the learned Commissioner of Income Tax(A) erred in confirming the same by rejecting written submissions and also overlooking the fact that debatable addition cannot be sustained u/s 154 or 143[1] [C] Relief Prayed: The appellant therefore prays Your Honour, 1) To delete the interest of Rs. 1, 45,533/- u/s 234B & 234C.” 2. Brief facts of the case are that assessee is an individual and senior citizen at the time of filing the return u/s 139(1) of the Act. Assessee has income under the head salaries amounting to Rs. 3, 45, 93,511/- and income from other sources amounting to Rs. 59, 98,660/-. Total tax liability of the assessee including such an education cess was Rs. 1, 42, 65,471/-. 3. Assessee discharged this liability via TDS amounting to Rs. 1, 27, 62,509/- and Rs. 15, 02,960/- as self assessment tax. Case of the assessee was processed u/s 143(1) of the Act vide intimation dated 06.02.2020 and liability u/s 234B of the Act and 234C of the Act calculated amounting to Rs. 69, 636/- and Rs. 75, 897/- respectively. Against this intimation assessee filed an application u/s 154 of the Act dated 06.03.2021, the same was rejected by CPC Bangalore vide order dated 12.03.2021. 3 ITA No. 2528/Mum/2022-Kirti M Shah 4. it’s a pure legal issue raised by the assessee. In this regard we refer the provisions of section 207 falls in Chapter XVII-Part C titled as “Advance Payment of Tax”. “207. [(1)] Tax shall be payable in advance during any financial year, in accordance with the provisions of sections 208 to 219 (both inclusive), in respect of the total income of the assessee which would be chargeable to tax for the assessment year immediately following that financial year, such income being hereafter in this Chapter referred to as "current income".] [(2) the provisions of sub-section (1) shall not apply to an individual resident in India, who— (a) does not have any income chargeable under the head "Profits and gains of business or profession"; and (b) Is of the age of sixty years or more at any time during the previous year.]” 5. The provision mentioned (supra) is a Charging Provision to create charge over the assessee to pay Advance Tax as per the Machinery Provisions provided in Chapter XVII-Part F titled as “Interest chargeable in certain cases”, otherwise liability to pay interest will be attracted as provided again in Chapter XVII-Part C titled as “Advance Payment of Tax”. 6. As the provisions are quite unambiguous about the liability of assessee to pay or not Advance Tax and consequential interest liability. We found force in the arguments of the assessee that when charging section it self is not applicable, and then in case of default there is no liability of interest as provided Chapter XVII-Part C titled as “Advance Payment of Tax”. In view of this CPC, Bangalore/ Jurisdictional AO is directed to delete the demand raised in the case of assessee u/s. 234B of the 4 ITA No. 2528/Mum/2022-Kirti M Shah Act and 234C of the Act calculated amounting to Rs. 69, 636/- and Rs. 75, 897/- respectively. 7. In the result, appeal of the assessee is allowed. Order pronounced in the open court on 21 st day of March, 2023. Sd/- Sd/- (VIKAS AWASTHY) (GAGAN GOYAL) JUDICIAL MEMBER ACCOUNTANT MEMBER Mumbai, दिन ांक/Dated: 21/03/2023 SK, Sr.PS Copy of the Order forwarded to: 1. अपील र्थी/The Appellant , 2. प्रदिव िी/ The Respondent. 3. आयकर आयुक्त CIT 4. दवभ गीय प्रदिदनदि, आय.अपी.अदि., मुबांई/DR, ITAT, Mumbai 5. ग र्ड फ इल/Guard file. BY ORDER, //True Copy// (Dy. /Asstt. Registrar) ITAT, Mumbai