Varad Medical Foundation, Latur V. Joint Commissioner of Income tax,

ITA 28/PUN/2017

• Counselvise Citation: [2019] 115 COUNSELVISE.COM (IT) 9231 (ITAT-PUNE)
• Duration Of Justice: 2 year(s) 8 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-09-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 17-07-2019
• Assessment Year: 2011-2012
• Appeal Filed On: 05-01-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MRS SHABANA PARVEEN
• Keywords: Reasonable cause; Condonation of delay; TDS; Set aside
• Section: 273B; 201

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, PUNE BEFORE SHRI D. KARUNAKARA RAO , ACCOUNTANT MEMBER AND SHRI VIKAS AWASTHY, JM . / ITA NO . 28 /P U N/201 7 / ASSESSMENT YEAR : 20 11 - 12 VARDA MEDICAL FOUNDATION, 01, LAHANE HOSPITAL, MAIN ROAD, SAWE WADI, LATUR 413512 T AN : NSKVO1861D ....... / APPELLANT / V/S. JOINT COMMISSIONER OF INCOME TAX, TDS RANGE, NASHIK / RESPONDENT ASSESSEE BY : SHRI BHARAT SHAH REVENUE BY : MRS. SHABANA PARVEEN / DATE OF HEARING : 23 - 0 7 - 2019 / DATE OF PRONOUNCEMENT : 20 - 0 9 - 2019 / ORDER PER VIKAS AWASTHY, JM : TH IS APPEAL HAS BEEN FILED BY THE ASSESSEE AGAINST THE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS) - 1 , AURANGABAD , DATED 01 - 09 - 201 6 FOR THE ASSESSMENT YEAR 20 11 - 12 CONFIRMING LEVY OF PENALTY U/S 272A(2)(K) R.W.S. 200(3) OF THE INCOME - TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT) . 2 ITA NO .28/PUN/2017, A.Y. 2011 - 12 2. THIS APPEAL IS TIME BARRED BY 32 DAYS. THE ASSESSEE HAS FILED AN APPLICATION S EEKING CONDONATION OF DELAY IN FILING OF THE APPEAL. AFTER PERUSAL OF THE SAME, WE ARE SATISFIED THAT THE DELAY IN FILING OF THE APPEAL IS NOT INTENTIONAL. THE DELAY HAS OCCURRED FOR THE BONAFIDE REASONS CITED IN THE APPLICATION. TAKING INTO CONSIDERATI ON THE ENTIRETY OF THE FACTS AND REASONS CITED CAUSING DELAY IN FILING OF THE APPEAL , THE DELAY OF 32 DAYS IN FILING OF THE APPEAL IS CONDONED . THE APPEAL IS ADMITTED FOR ADJUDICATION ON MERITS. 3. SHRI BHARAT SHAH APPEARING ON BEHALF OF ASSESSEE SUBMITTED THAT THE ASSESSING OFFICER HAD INVOKED PENAL PROVISIONS UNDER SECTION 272A(2)(K) OF THE ACT FOR DELAY IN FILING QUARTERLY E - TDS STATEMENTS U/S 200(3) OF THE ACT DURING FINANCIAL YEAR 2010 - 11 AND LEVIED PENALTY OF RS.71,083/ - . THE LD. AR CONTENDE D THAT THE ASSESSEE HAD DEPOSITED TDS WITHIN TIME. HOWEVER, THERE WAS DELAY IN FURNISHING QUARTERLY E - TDS STATEMENTS. THE LD. AR CONTENDED THAT THE ASSESSEE IS A CHARITABLE ORGANIZATION AND IS PROVIDING FREE MEDICAL SERVICES TO POOR PATIENTS IN THE S TATE S OF MAHARASHTRA, KARNATAKA AND ANDHRA PRADESH. THE ENTIRE ACTIVITIES OF ASSESSEE ARE FUNDED BY DONATIONS AND HENCE, THE ASSESSEE DOES NOT HAVE THE FACILITY OF EXPERT PROFESSIONALS ON TAX ISSUES. THE ACCOUNTANT OF THE ASSESSEE LEFT JOB IN APRIL, 2011. T HE NEXT INCUMBENT APPOINTED BY THE ASSESSEE TO LOOK AFTER THE ACCOUNTS, WAS NOT ACQUAINTED WITH E - TDS PROVISIONS THAT WERE NEWLY INTRODUCED . IT WAS DURING THE COURSE OF AUDIT FOR THE FINANCIAL YEAR 2010 - 11 IT TRANSPIRED THAT E - TDS QUARTERLY STATEMENTS WER E NOT FILED WITHIN TIME AS PROVIDED IN THE ACT. THUS, THERE WAS DELAY IN FILING OF E - TDS STATEMENTS. AS FAR AS TDS AMOUNTS WERE CONCERNED, THEY WERE PROMPTLY DEPOSITED IN THE GOVERNMENT EXCHEQUER WITHOUT DELAY AFTER DEDUCTING TDS FROM THE PAYMENTS MADE. THE LD. AR SUBMITTED THAT THE TRIBUNAL IN THE CASE OF 3 ITA NO .28/PUN/2017, A.Y. 2011 - 12 PRAVIN CHATARBHUJ BAJAJ VS. ADDL. CIT IN ITA NO.933/PUN/2016, DECIDED ON 09.02.2018 HAD DELETED THE PENALTY LEVIED U/S 272A(2)(K) OF THE ACT WHERE THE DELAY HAD OCCURRED IN FILING QUARTERLY E - STATEMENT S AND THE ASSESSEE WAS ABLE TO SHOW REASONABLE CAUSE RESULTING IN DELAY . 4 . ON THE OTHER HAND , MRS. SHABANA PARVEEN REPRESENTING THE DEPARTMENT VEHEMENTLY DEFENDED IMPUGNED ORDER IN CONFIRMING LEVY OF PENALTY U/S 272A(2)(K) OF THE ACT. THE LD. DR SUBMITTED THAT THE ASSESSEE DEFAULTED FOR ALL THE FOUR QUARTERS OF FINANCIAL YEAR 2010 - 11 IN FILING THE QUARTERLY E - TDS STATEMENTS AS REQUIRED U/S 200(3) OF THE ACT. THE LD. DR SUBMITTE D THAT THE PROVISIONS OF THE ACT ARE UNAMBIGUOUS IN STATING THAT IN CASE OF DELAY IN FILING THE QUARTERLY E - TDS STATEMENTS, PENALTY @ RS.100/ - PER DAY HAS TO BE CHARGED. 5 . W E HAVE H EARD THE SUBMISSIONS MADE BY REPRESENTATIVES OF RIVAL SIDES AND HAVE PERUSED THE ORDERS OF AUTHORITIES BELOW. THERE IS DELAY IN FILING OF E - TDS QUARTERLY STATEMENTS DURING THE FINANCIAL YEAR 2010 - 11. THE ASSESSING OFFICER LEVIED PENALTY U/S 272A(2)(K) OF THE ACT AS UNDER: - F.Y. 2010 - 11 PERIOD DUE DATE DATE OF FIL ING DELAY DAYS PENALTY @ RS.100/ - PER DAY REMARKS Q1 15 - JUL - 10 17 - NOV - 11 490 49,000/ - WHICH IS RESTRICTED TO THE TAX DEDUCTIBLE I.E. RS.9,000/ - Q2 15 - OCT - 10 17 - NOV - 11 398 39,800/ - WHICH IS RESTRICTED TO THE TAX DEDUCTIBLE I.E.RS.18,153/ - Q3 15 - JAN - 11 17 - NOV - 11 306 30,600/ - WHICH IS RESTRICTED TO THE TAX DEDUCTIBLE I.E.RS.25,330/ - Q4 15 - MAY - 11 17 - NOV - 11 186 18,600/ - WHICH IS RESTRICTED TO THE TAX DEDUCTIBLE I.E.RS.20,710/ - TOTAL PENALTY RS.71,083 4 ITA NO .28/PUN/2017, A.Y. 2011 - 12 6. UNDISPUTEDLY, THE ASSESSEE HAD DEPOSITED TDS AMOUNT TO THE GOVERNMENT EXCHEQUER SHORTLY AFTER DEDUCTING THE SAME FROM THE PAYMENTS MADE . THUS, IT IS NOT THE CASE OF REVENUE THAT THERE WAS DELAY IN DEPOSIT OF TDS AMOUNT BY THE ASSESSEE. THE ONLY DEFAULT C OMMITTED BY THE ASSESSEE IS DELAY IN FILING OF E - TDS STATEMENTS DURING THE FINANCIAL YEAR 2010 - 11. 7. THE LD. AR HAS EXPLAINED THAT THE OLD ACCOUNTANT OF ASSESSEE HAD LEFT THE JOB AND THE NEW ACCOUNTANT WAS NOT CONVERSANT WITH THE RECENTLY INTRODUCED PROVISIONS OF E - FILING OF THE RETURNS, THERE WAS DELAY IN FILING OF E - RETURNS. 8. THE CO - ORDINATE BENCH OF THE TRIBUNAL IN BUNCH OF APPEALS LEAD CASE BEING NAV MAHARASHTRA VIDYALAYA VS. ADDL.CIT IN ITA NO.832/PN/2016 FOR ASSESSMENT YEAR 2011 - 12 DECIDED ON 07.10.2016 OBSERVED THAT RULES REGARDING FILING OF TDS RETURNS WERE AMENDED BY INCOME TAX (SIXTH) AMENDMENT RULES, 2010 W.E.F. 01.04.2010 REQUIRING ASSESSEES TO FILE E - TDS STATEMENTS. SINCE, THERE WERE PRACTICAL DIFFICULTIES TO COMPLY WITH NEWLY INTRODU CED REQUIREMENTS OF E - TDS FILING OF STATEMENTS, BEING TECHNICAL DELAY AND NOT VENIAL IN NATURE, MERITS TO BE CONSIDERED A REASONABLE CAUSE FOR NON LEVY OF PENALTY AS PER THE REQUIREMENTS OF SECTION 273B OF THE ACT. 9 . THE TRIBUNAL IN THE CASE OF PRAVIN CH ATARBHUJ BAJAJ VS. ADDL. CIT (SUPRA) AFTER PLACING RELIANCE ON THE DECISION RENDERED IN THE CASE OF NAV MAHARASHTRA VIDYALAYA VS. ADDL.CIT (SUPRA) ACCEPTED THE EXPLANATION FURNISHED BY ASSESSEE CAUSING DELAY IN FILING OF RETURN AND DELETED PENALTY 5 ITA NO .28/PUN/2017, A.Y. 2011 - 12 LEVIED U /S 272A(2)(K) OF THE ACT . TAKING INTO CONSIDERATION ENTIRETY OF FACTS, WE ARE OF THE CONSIDERED VIEW THAT THE ASSESSEE HAS BEEN ABLE TO SHOW REASONABLE CAUSE IN DELAY IN FILING OF E - TDS STATEMENTS. THE EXPLANATION FURNISHED BY ASSESSEE IS ACCEPTED AND TH E PENALTY LEVIED IS LIABLE TO BE DELETED. WE HOLD AND DIRECT ACCORDINGLY. THE IMPUGNED ORDER IS SET ASIDE AND THE APPEAL OF ASSESSEE IS ALLOWED. 10 . IN THE RESULT, APPEAL OF ASSESSEE IS ALLOWED . ORDER PRONOUNCED ON F R I D A Y , THE 2 0 T H DAY OF SEPTEMBER , 2019 . SD/ - SD/ - ( D.KARUNAKARA RAO ) (VIKAS AWASTHY) ACCOUNTANT MEMBER JUDICIAL MEMBER / PUNE; / DATED : 2 0 T H SEPTEMBER , 2019 GCVSR / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT. 2. / THE RESPONDENT. 3. ( ) / THE CIT(A) - 1 , AURANGABAD. 4. THE CIT - TDS , PUNE . 5. , , , / DR, ITAT, A BENCH, PUNE. 6. / GUARD FILE. / BY ORDER, // TRUE COPY // / SR. PRIVATE SECRETARY , / ITAT, PUNE