General Manager (Telecom), Muzaffarnagar V. ITO (TDS & Survey), Muzaffarnagar

ITA 260/DEL/2011

• Counselvise Citation: 26020114 RSA 2011
• Duration Of Justice: 3 year(s) 10 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-11-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 17-11-2014
• Assessment Year: 2010-2011
• Appeal Filed On: 14-01-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SATPAL SINGH
• Assessee Lawyers: K C KAUSHIK
• Keywords: Question of law
• Section: 201(1)

Judgement Text

I.T.A. NO.: 258 TO 260/DEL/2011 ASSESSMENT YEARS: 2008 - 09, 2009 - 10 AND 2010 - 11 PAGE 1 OF 7 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI C BENCH, NEW DELHI [CORAM: PRAMOD KUMAR AM , AND C . M . GARG JM ] I.T.A. NO .: 258, 259 AND 260/DEL/2011 ASSESSMENT YEAR S: 2008 - 09, 2009 - 10 AND 2010 - 11 BHARAT SANCHAR NIGAM LIMITED .. .APPELLANT OFFIC E OF GM (TELECOM) PATEL NAGAR, MUZAFFRANAGAR (UP) VS. INCOME TAX OFFICER (TDS AND SURVEY), MUZAFFARNAGAR . RESPONDENT APPEARANCES BY: K C KAUSHIK, FOR THE APPELLANT SATPAL SINGH , FOR THE RESPONDENT O R D E R PER BENCH : 1. THESE THREE APPEALS FILED BY THE ASSESSEE ARE DIRECTED AGAINST THE CONSOLIDATED ORDER DATED 27 TH SEPTEMBER, 2010, PASSED BY THE LD. CIT(A ), MUZAFFARNAGAR, IN THE MATTER OF DEMANDS RAISED UNDER SECTION 201/201(1A) READ WITH SECTION 194H OF THE INCOME TAX ACT, 1 961, FOR THE ASSESSMENT YEARS 2008 - 09, 2009 - 10 & 2010 - 11. 2. AS THE ISSUES INVOLVED IN THESE APPEALS ARE COMMON AND THE GRIEVANCES ARISE ON A COMMON SET OF MATERIAL FACTS, WE DEEM IT PROPER TO DISPOSE OF ALL THE THREE APPEALS BY WAY OF THIS CONSOLIDATE D ORDER. 3. TO ADJUDICATE ON THESE APPEALS, ONLY FEW MATERIAL FACTS NEED TO BE TAKEN NOTE OF. THE A.O. (TDS) HAS RAISED THE DEMANDS ON THE ASSESSEE, A GOVERNMENT I.T.A. NO.: 258 TO 260/DEL/2011 ASSESSMENT YEARS: 2008 - 09, 2009 - 10 AND 2010 - 11 PAGE 2 OF 7 UNDERTAKING, ON ACCOUNT OF ASSESSEES NOT HAVING DEDUCTED TAX AT SOURCE IN RESPECT OF DISCOU NT OF RECHARGE VOUCHERS AND PREPAID SIM CARDS ALLOWED TO THE FRANCHISEES. THE A.O. WAS OF THE VIEW THAT THE ASSESSEE WAS UNDER AN OBLIGATION TO DEDUCT TAX AT SOURCE UNDER SECTION 194H OF THE ACT IN RESPECT OF THE DISCOUNT SO ALLOWED TO THE FRANCHISEES. W HEN ASSESSEE CARRIED THE GRIEVANCE IN APPEAL BEFORE THE LD. CIT(A), THE LD. CIT(A) ALSO CONFIRMED THE DEMANDS SO RAISED UNDER SECTION 201/201(1A) READ WITH SECTION 194H OF THE INCOME TAX ACT, 1961. THE ASSESSEE IS NOT SATISFIE D AND IS IN APPEAL BEFORE US. 4. D URING THE COURSE OF HEARING BEFORE US, IT WAS NOTICED THAT THERE IS NO FINDING BY THE A.O. TO THE EFFECT THAT THE RECIPIENT OF THE MONEY I.E. FRANCHISEES HAVE NOT PAID THE TAXES ON INCOME EMBEDDED IN THE AMOUNTS IN QUESTION. IN THIS BACKGROUND, WE ARE OF THE CONSIDERED VIEW THAT THE MATTER DESERVES TO BE SENT BACK TO THE FILE OF A.O. FOR RECONSIDERATION IN THE LIGHT OF FOLLOWING OBSERVATIONS MADE BY THE CO - ORDINATE BENCH IN DUE DEFERENCE TO HONBLE ALLAHABAD HIGH COURTS JUDGEMENT IN THE CASE OF JAG RAN PRAKASHAN LIMITED VS. DCIT (2012) 21 TAXMAN.COM 489 (ALL) , IN THE CASE OF ICICI BANK LIMITED VS. DCIT, 156 TTJ 569 : - 6. IT IS, HOWEVER, IMPORTANT TO BEAR IN MIND THE SETTLED LEGAL POSITION THAT A SHORT DEDUCTION OF TAX AT SOURCE, BY ITSELF DOES NOT R ESULT IN A LEGALLY SUSTAINABLE DEMAND U/S 201(1) AND U/S 201(1A). AS HELD BY HON'BLE SUPREME COURT IN THE CASE OF HINDUSTAN COCA COLA BEVERAGE PVT. LTD. VS. CIT (293 ITR 226), THE TAXES CANNOT BE RECOVERED ONCE AGAIN FROM THE ASSESSEE IN A SITUATION IN WHI CH THE RECIPIENT OF INCOME HAS PAID DUE TAXES ON INCOME EMBEDDED IN THE PAYMENTS FROM WHICH TAX WITHHOLDING REQUIREMENTS WERE NOT FULLY OR PARTLY, COMPLIED WITH. HONBLE JURISDICTIONAL HIGH COURT, IN THE CASE OF JAGRAN PRAKASHAN LTD VS DCIT [(2012) 21 TAXM ANN.COM 489 ALL] ALSO HAS, INTER ALIA, OBSERVED AS FOLLOWS: ..IT IS CLEAR THAT DEDUCTOR CANNOT BE TREATED AN ASSESSEE IN DEFAULT TILL IT IS FOUND THAT ASSESSEE HAS ALSO FAILED TO PAY SUCH TAX DIRECTLY. IN THE PRESENT CASE, THE INCOME TAX AUTHORITIES HA D NOT ADVERTED TO THE EXPLANATION TO SECTION 191 NOR HAD APPLIED THEIR MIND AS TO WHETHER THE ASSESSEE HAS ALSO FAILED TO PAY SUCH TAX DIRECTLY. THUS, TO DECLARE A DEDUCTOR, WHO FAILED TO DEDUCT I.T.A. NO.: 258 TO 260/DEL/2011 ASSESSMENT YEARS: 2008 - 09, 2009 - 10 AND 2010 - 11 PAGE 3 OF 7 THE TAX AT SOURCE AS AN ASSESSEE IN DEFAULT, CONDITION PRECED ENT IS THAT ASSESSEE HAS ALSO FAILED TO PAY TAX DIRECTLY. THE FACT THAT ASSESSEE HAS FAILED TO PAY TAX DIRECTLY IS THUS, FOUNDATIONAL AND JURISDICTIONAL FACT AND ONLY AFTER FINDING THAT ASSESSEE HAS FAILED TO PAY TAX DIRECTLY, DEDUCTOR CAN BE DEEMED TO BE AN ASSESSEE IN DEFAULT IN RESPECT OF SUCH TAX.. 7. IT IS THUS CLEAR THAT THE ONUS IS ON THE REVENUE TO DEMONSTRATE THAT THE TAXES HAVE NOT BEEN RECOVERED FROM THE PERSON WHO HAD THE PRIMARILY LIABILITY TO PAY TAX, AND IT IS ONLY WHEN THE PRIMARY LIABILI TY IS NOT DISCHARGED THAT VICARIOUS RECOVERY LIABILITY CAN BE INVOKED. ONCE ALL THE DETAILS OF THE PERSONS TO WHOM PAYMENTS HAVE BEEN MADE ARE ON RECORD, IT IS FOR THE ASSESSING OFFICER, WHO HAS AL L THE POWERS TO REQUISITION THE INFORMATION FROM SUCH PAYE RS AND FROM THE INCOME TAX AUTHORITIES, TO ASCERTAIN WHETHER OR NOT TAXES HAVE BEEN PAID BY THE PERSONS IN RECEIPT OF THE AMOUNTS FROM WHICH TAXES HAVE NOT BEEN WITHHELD. AS A RESULT OF THE JUDGMENT OF HONBLE ALLAHABAD HIGH COURT IN JAGRAN PRAKASHANS CAS E (SUPRA), THERE IS A PARADIGM SHIFT IN THE MANNER IN WHICH RECOVERY PROVISIONS UNDER SECTION 201(1) CAN BE INVOKED. AS OBSERVED BY THEIR LORDSHIPS, THE PROVISIONS OF SECTION 201(1) CANNOT BE INVOKED AND THE 'TAX DEDUCTOR CANNOT BE TREATED AN ASSESSEE IN D EFAULT TILL IT IS FOUND THAT ASSESSEE HAS ALSO FAILED TO PAY SUCH TAX DIRECTLY' . ONCE THIS FINDING ABOUT THE NON - PAYMENT OF TAXES BY THE RECIPIENT IS HELD TO A CONDITION PRECEDENT TO INVOKING SECTION 201(1), THE ONUS IS ON THE ASSESSING OFFICER TO DEMONST RATE THAT THE CONDITION IS SATISFIED. NO DOUBT THE ASSESSEE HAS TO SUBMIT ALL SUCH INFORMATION ABOUT THE RECIPIENT AS HE IS OBLIGED TO MAINTAIN UNDER THE LAW, ONCE THIS INFORMATION IS SUBMITTED IS FOR THE ASSESSING OFFICER TO ASCERTAIN WHETHER OR NOT THE T AXES HAVE BEEN PAID BY THE RECIPIENT OF INCOME. THIS APPROACH, IN OUR HUMBLE UNDERSTANDING, IS IN CONSONANCE WITH THE LAW LA ID DOWN BY HONBLE ALLAHABAD HIGH COURT. 8. IT IS IMPORTANT TO BEAR IN MIND THAT THE LAPSE ON ACCOUNT OF NON - DEDUCTION OF TAX AT SOURCE IS TO BE VISITED WITH THREE DIFFERENT CONSEQUENCES PENAL PROVISIONS, INTEREST PROVISIONS AND RECOVERY PROVISIONS. THE PENAL PROVISIONS IN RESPECT OF SUCH A LAPSE ARE SET OUT IN SECTION 271 C. SO FAR AS PENAL PROVISIONS ARE CONCERNED, THE PENALTY I S FOR LAPSE ON THE PART OF THE ASSESSEE AND IT HAS NOTHING TO DO WITH WHETHER OR NOT THE TAXES WERE ULTIMATELY RECOVERED THROUGH OTHER MEANS. THE PROVISIONS REGARDING INTEREST IN DELAY IN DEPOSITING THE TAXES ARE SET OUT IN SECTION 201(1A). THESE PROVISION S PROVIDE THAT FOR ANY DELAY IN RECOVERY OF SUCH TAXES IS TO BE COMPENSATED BY THE LEVY OF INTEREST. AS FAR AS RECOVERY PROVISIONS ARE CONCERNED, THESE PROVISIONS ARE SET OUT IN SECTION 201(1) WHICH SEEKS TO MAKE GOOD ANY LOSS TO REVENUE ON ACCOUNT OF LAPS E BY THE ASSESSEE TAX DEDUCTOR. HOWEVER, THE QUESTION OF MAKING GOOD THE LOSS OF REVENUE ARISES ONLY I.T.A. NO.: 258 TO 260/DEL/2011 ASSESSMENT YEARS: 2008 - 09, 2009 - 10 AND 2010 - 11 PAGE 4 OF 7 WHEN THERE IS INDEED A LOSS OF REVENUE AND THE LOSS OF REVENUE CAN BE THERE ONLY WHEN RECIPIENT OF INCOME HAS NOT PAID TAX. THEREFORE, RECOVER Y PROVISIONS UNDER SECTION 201(1) CAN BE INVOKED ONLY WHEN LOSS TO REVENUE IS ESTABLISHED, AND THAT CAN ONLY BE ESTABLISHED WHEN IT IS DEMONSTRATED THAT THE RECIPIENT OF INCOME HAS NOT PAID DUE TAXES THEREON. IN THE ABSENCE OF THE STATUTORY POWERS TO REQUISITION ANY I NFORMATION FROM THE RECIPIENT OF INCOME, THE ASSESSEE IS INDEED NOT ALWAYS ABLE TO OBTAIN THE SAME. THE PROVISIONS TO MAKE GOOD THE SHORT FALL IN COLLECTION OF TAXES MAY THUS END UP BEING INVOKED EVEN WHEN THERE IS NO SHORTFALL IN FACT. ON THE OTHER HAND, ONCE ASSESSEE FURNISHES THE REQUISITE BASIC INFORMATION, THE ASSESSING OFFICER CAN VERY WELL ASCERTAIN THE RELATED FACTS ABOUT PAYMENT OF TAXES ON INCOME OF THE RECIPIENT DIRECTLY FROM THE RECIPIENTS OF INCOME. I T IS NOT THE REVENUES CASE BEFORE US THAT, ON THE FACTS OF THIS CASE, SUCH AN EXERCISE BY THE ASSESSING OFFICER IS NOT POSSIBLE. IT DOES PUT AN ADDITIONAL BURDEN ON THE ASSESSING OFFICER BEFORE HE CAN INVOKE SECTION 201(1) BUT THAT SHOW HONBLE HIGH COURT HAS VISUALIZED THE SCHEME OF ACT AND THAT S HOW, THEREFORE, IT MEETS THE EN D O F JUSTICE. 9. AS FAR AS LEVY OF INTEREST UNDER SECT ION 201(1A) IS CONCERNED, THIS INTEREST IS ADMITTEDLY A COMPENSATORY INTEREST IN NATURE AND IT SEEKS TO COMPENSATE THE REVENUE FOR DELAY IN REALIZATION OF TAXES. H ONBLE BOMBAY HIGH COURT, IN THE CASE OF BENNETT COLEMAN & CO LTD VS ITO (157 ITR 812) HAS HELD SO. THEREFORE, LEVY OF INTEREST UNDER SECTION 201(1A) IS APPLICABLE WHETHER OR NOT THE ASSESSEE WAS AT FAULT. HOWEVER, SINCE IT IS ONLY COMPENSATORY IN NATURE I T IS APPLICABLE FOR THE PERIOD OF THE DATE ON WHICH TAX WAS REQUIRED TO BE DEDUCTED TILL THE DATE WHEN TAX WAS EVENTUALLY PAID. HOWEVER, IN A CASE IN WHICH THE RECIPIENT OF INCOME HAD NO TAX LIABILITY EMBEDDED IN SUCH PAYMENTS, THERE WILL OBVIOUSLY BE NO Q UESTION OF DELAY IN REALIZATION OF TAXES AND THE PROVISIONS OF SECTION 201(1A) WILL NOT COME INTO PLAY AT ALL. THE COMPUTATION OF INTEREST IS TO BE REDONE IN THE LIGHT OF THIS LEGAL POSITION. 10. THE MATTER THUS STANDS RESTORED TO THE FILE OF THE ASSESSI NG OFFICER FOR FRESH ADJUDICATION IN ACCORDANCE WITH THE LAW AND IN THE LIGHT OF OUR OBSERVATIONS ABOVE. WHILE DOING SO, THE ASSESSING OFFICER WILL GIVE A DUE AND FAIR OPPORTUNITY OF HEARING TO THE ASSESSEE AND DISPOSE OF THE MATTER BY WAY OF A SPEAKING OR DER. WE DIRECT SO. 5 . LEARNED DEPARTMENTAL REPRESENTATIVE DID NOT HAVE MUCH TO SAY BEYOND PLACING H IS RELIANCE ON THE ORDERS OF THE AUTHORITIES BELOW AND CONTENDING THAT ON MERIT OF THE CASE THE ASSESSEE OUGHT TO HAVE DEDUCTED TAX AT SOURCE. THAT PLEA OF HERS IS NOT RELEVANT IN THE ABOVE CONTEXT IN AS MUCH AS TDS LIABILITY IS I.T.A. NO.: 258 TO 260/DEL/2011 ASSESSMENT YEARS: 2008 - 09, 2009 - 10 AND 2010 - 11 PAGE 5 OF 7 ONLY A VICARIOUS LIABILITY. IN THE CIRCUMSTANCES IN WHICH PRINCIPAL LIABILITY IS DISCHARGED, VICARIOUS LIABILITY DOES NOT SURVIVE. 6. IN ANY EVENT, THE ISSUE ALSO SEEMS TO BE C OVERED, ON MERITS, IN FAVOUR OF THE ASSESSEE BY DECISION OF HONBLE PUNJAB & HARYANA HIGH COURT IN THE CASE OF CIT VS. BHARAT SANCHAR NIGAM LIMITED (95 DTR 253) WHEREIN THEIR LORDSHIPS HAVE, INTER ALIA, OBSERVED AS FOLLOWED: THE ASSESSEE, A GOVERNMENT OF INDIA UNDERTAKING, HAS PAID COMMISSION TO STD/PCO FRANCHISES DURING THE YEARS UNDER CONSIDERATION WITHOUT DEDUCTION OF TAX. THE ASSESSING OFFICER FOUND THAT THE ASSESSEE HAS VIOLATED THE MANDATE OF SECTION 194H OF THE ACT BY NOT DEDUCTING TAX AT SOURCE. CO NSEQUENTLY, THE ASSESSING OFFICER MADE THE ASSESSEE LIABLE TO PAY THE AMOUNT OF TAX AS WELL AS INTEREST THEREON. SUCH ORDER WAS AFFIRMED BY THE COMMISSIONER OF INCOME TAX (APPEALS). THE TRIBUNAL EXAMINED THE PROVISO INSERTED TO SECTION 194H VIDE FINANCE A CT, 2007 W.E.F. 01.06.2007. THE SAID PROVISO READS AS UNDER: '194H. XX XX PROVIDED ALSO THAT NO DEDUCTION SHALL BE MADE UNDER THIS SECTION ON ANY COMMISSION OR BROKERAGE PAYABLE BY BHARAT SANCHAR NIGAM LIMITED OR MAHANAGAR TELEPHONE NIGAM LIMITED TO THEI R PUBLIC CALL OFFICE FRANCHISEES.' THE TRIBUNAL GRANTED THE BENEFIT OF SUCH AMENDMENT TO THE ASSESSEE HOLDING THE SAME TO BE CLARIFICATORY IN NATURE. SUCH ORDER OF THE TRIBUNAL IS BASED UPON THE INCOME TAX APPELLATE TRIBUNAL, PUNE BENCH IN ITA NO.71 TO 77 /PN/2009 FOR THE ASSESSMENT YEAR 2002 - 2003 AND 2008 - 09 IN RESPECT OF THE ASSESSEE HEREIN. CONSIDERING THE CIRCULAR DATED 12.03.2008 AND THE INSTRUCTIONS DATED 08.05.2009, THE TRIBUNAL HAS RECORDED THE FOLLOWING FINDINGS: '7. WHILE THE AFORESAID AMENDMENT WAS STATED TO BE PROSPECTIVE I.E. WITH EFFECT FROM 1 ST JUNE, 2007, IT CANNOT BE INFERRED THAT SO FAR AS PRIOR PERIOD IS CONCERNED, THE STAND TAKEN BY THE CENTRAL BOARD OF DIRECT TAXES IS THAT RECOVERIES FOR NON DEDUCTION UNDER SECTION 194H R.W.S. 201 ARE T O BE MADE FOR THE SAME. THE ABOVE EXTRACTS FROM THE BOARD CIRCULAR WOULD SHOW THAT THE AMENDMENT IN THE SECTION 194H WAS BROUGHT ABOUT BECAUSE, AS ADMITTED BY THE CBDT ITSELF, VERY FEW OF THE RECIPIENTS HAD A TAX LIABILITY. IT IS WELL SETTLED IN LAW THAT A TAX WITHHOLDING LIABILITY IS A VICARIOUS LIABILITY, AS A PART OF TAX COLLECTION MECHANISM, IN THE SENSE THAT WHEN THERE IS NO PRIMARY LIABILITY OF THE I.T.A. NO.: 258 TO 260/DEL/2011 ASSESSMENT YEARS: 2008 - 09, 2009 - 10 AND 2010 - 11 PAGE 6 OF 7 TAXPAYER, PROXY LIABILITY OF THE TAX DEDUCTOR ALSO DOES NOT SURVIVE. IN A SITUATION LIKE THE ONE, WE ARE IN SEISIN OF, IN WHICH THE CBDT ITSELF ACCEPTS THAT THERE IS HARDLY ANY PRIMARY TAX LIABILITY OF THE RECIPIENTS OF INCOME. IT IS HIGHLY CONTENTIOUS AN ISSUE WHETHER OR NOT VICARIOUS TAX WITHHOLDING LIABILITY CAN BE INVOKED. AS A MATTER OF FACT, THE CENTRA L BOARD OF TAXES HAS TAKEN A STAND THAT THE DEMANDS ARE NOT TO BE ENFORCED ON BSNL AND MTNL OFFICES EXCEPT IN THE CASES WHERE TAXES HAVE BEEN DEDUCTED AT SOURCE BUT NOT PAID OVER TO THE REVENUE 8. THE STAND TAKEN BY THE AUTHORITIES BELOW IS THUS CONTRARY TO THE STAND TAKEN BY THE CENTRAL BOARD OF DIRECT TAXES. WHILE AUTHORITIES BELOW HAVE TAKEN A STAND THAT THE PROSPECTIVE AMENDMENT IN SECTION 194 H, BY ITSELF, DEMONSTRATES THAT THE TAXES WERE REQUIRED TO BE DEDUCTED AT SOURCE IN RESPECT OF PCO COMMISSION FOR EARLIER YEARS, THE CENTRAL BOARD OF DIRECT TAXES IS OF THE VIEW THAT EXCEPT IN CASES WHERE BSNL OR MTNL HAS DEDUCTED THE TAXES, BUT NOT PAID OVER THE SAME TO THE TREASURY, DEMANDS ARE NOT TO BE ENFORCED TILL THE MATTER IS SORTED OUT BY THE BOARD. WHEN SUCH IS THE STAND TAKEN BY THE CBDT ITSELF, IT CANNOT BE SAID THAT IN VIEW OF THE INSERTION OF PROVISO TO SECTION 194H WITH EFFECT FROM 1 ST JUNE, 22007. IT IS BEYOND DOUBT OR CONTROVERSY THAT SO FAR AS THE PERIOD PRIOR TO THIS AMENDMENT IS CONCERNED, THE T AX DEDUCTION AT SOURCE REQUIREMENTS UNDER SECTION 194H APPLIED ON PAYMENTS OF COMMISSION TO PCO FRANCHISEES. LEARNED COMMISSIONER (APPEALS) DID NOT, THEREFORE, HAVE ANY GOOD REASONS TO DISREGARD THE BINDING JUDICIAL PRECEDENT. IT CANNOT BE OPEN TO A SUBORD INATE OR COORDINATE JUDICIAL FORUM TO DISREGARD THE DECISION OF THIS TRIBUNAL, IN ASSESSEES OWN CASE, MERELY ON THE GROUND THAT THE LATER AMENDMENT IN LAW, WITH EFFECT FROM 1 ST JUNE, 2007, MUST BE INFERRED TO BE CLARIFYING THE POSITION PRIOR TO THE SAID A MENDMENT. THE DISTINCTION MADE OUT BY THE LEARNED CIT(A), THEREFORE, DOES NOT MEET OUR APPROVAL. HAVING REGARD TO THE DISCUSSIONS ABOUT THE IMPACT OF CBDT CIRCULARS, WE MAY ALSO ADD THAT IT IS ONLY ELEMENTARY THAT THE CIRCULARS ISSUED BY THE CENTRAL BOARD OF DIRECT TAXES ARE BINDING ON THE ASSESSEE ONLY TO THE LIMITED EXTENT OF THESE CIRCULARS BEING BENEFICIAL IN NATURE. IN OTHER WORDS, AN ASSESSEE CANNOT BE SADDLED WITH A LIABILITY ONLY ON THE GROUND THAT THE CIRCULAR ISSUED BY THE CBDT HOLDS SO. SUCH A LI ABILITY HAS TO BE SUPPORTED BY THE CLEAR PROVISIONS OF STATUTE. REVENUE THUS CANNOT DERIVE ANY SUPPORT FROM RELIANCE ON THE CIRCULARS PASSED BY THE CBDT.' SUCH ORDER WAS FOLLOWED BY PUNE BENCH OF THE TRIBUNAL IN THE ASSESSMENT YEARS 2006 - 07 AND 2007 - 08 VI DE ORDER DATED 07.12.2011 AS WELL. SIMILAR VIEW WAS TAKEN BY NEW DELHI BENCH OF THE TRIBUNAL IN RESPECT OF ASSESSEES OWN CASE FOR THE ASSESSMENT YEAR 2002 - 03 IN ITA NO.3996/D/2004. WE DO NOT FIND THAT ANY SUBSTANTIAL QUESTION OF LAW ARISES FOR CONSIDERAT ION, INTER ALIA, FOR THE REASON THAT THE CENTRAL BOARD OF DIRECT TAXES VIDE I.T.A. NO.: 258 TO 260/DEL/2011 ASSESSMENT YEARS: 2008 - 09, 2009 - 10 AND 2010 - 11 PAGE 7 OF 7 CIRCULAR DATED 12.03.2008 HAS TAKEN A STAND THAT THE DEMANDS ARE NOT TO BE ENFORCED ON BSNL AND MTNL OFFICES EXCEPT IN THE CASES WHERE TAXES HAVE BEEN DEDUCTED AT SOURCE BUT NOT PA ID OVER TO THE REVENUE. THE PROVISO IS CLARIFICATORY IN NATURE THOUGH IT WAS INSERTED BY THE FINANCE ACT, 2007 W.E.F. 01.06.2007. THE NATURE OF THE AMENDMENT AND THE PURPOSE WHICH IT SEEKS TO ACHIEVE MAKE IT ABUNDANTLY CLEAR THAT IT IS A CLARIFICATORY AMEN DMENT AND WOULD BE APPLICABLE EVEN IN RESPECT OF ASSESSMENT YEARS PRIOR TO INSERTION OF THE SAID AMENDMENT. 7. DURING THE COURSE OF REMANDED PROCEEDINGS THE ASSESSING OFFICER SHALL EXAMINE THE MATTER AFRESH, INTER ALIA, IN THE LIGHT OF THIS GUIDANCE, AS I NDEED ANY OTHER JUDICIAL PRECEDENTS AS MAY BE AVAILABLE, FROM HONBLE COURTS ABOVE. 8 . IN VIEW OF THE ABOVE DISCUSSION AND ALSO BEARING IN MIND THE ENTIRETY OF THE CASE, WE REMIT THE MATTER TO THE FILE OF A.O. TO ADJUDICATE THE ISSUE DE NOVO IN THE LIG HT OF THE ABOVE DISCUSSION 9 . IN THE RESULT, ALL THE THREE APPEALS ARE ALLOWED FOR STATISTICAL PURPOSES IN THE TERMS INDICATED ABOVE. PRONOUNCED IN THE OPEN COURT TODAY ON 18 TH DAY OF NOVEMBER, 2014. SD/XX SD/XX C M GARG PRAMOD KUMAR (J UDICIAL MEMBER) (ACCOUNTANT MEMBER) NEW DELHI, THE 18 TH DAY OF NOVEMBER, 2014 COPIES TO : (1) THE APPELLANT (2) THE RESPONDENT (3) COMMISSIONER (4) DRP (5) DEPARTMENTAL REPRESENTATIVE ( 6) GUARD FILE BY ORDER ETC ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES, NEW DELHI