Shri Mahesh Kumar Mandelia, Kolkata V. ITO, Ward - 35(4), Kolkata, Kolkata

ITA 295/KOL/2011

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 54453 (ITAT-KOLKATA)
• Duration Of Justice: 5 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-08-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2006-2007
• Appeal Filed On: 18-02-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RANADHIR GUPTA
• Assessee Lawyers: S M SURANA

Judgement Text

, SMC ( ) , IN THE INCOME TAX APPELLATE TRIBUNAL SMC (A) BENC H: KOLKATA () BEFORE , ) [BEFORE HONBLE SRI MAHAVIR SINGH, JM] / I.T.A NO. 295/KOL/2011 ! '# ! '# ! '# ! '#/ // / ASSESSMENT YEAR: 2006-07 SHRI MAHESH KUMAR MANDELIA VS. INCOME-TAX OFFICER , WD-35(4), KOLKATA, (PAN-AELPM 0542 A) (%& /APPELLANT ) ('(%&/ RESPONDENT ) FOR THE APPELLANT: SHRI S. M. SURANA FOR THE RESPONDENT: SHRI RANADHIR GUPTA, SR.DR )* / ORDER THIS APPEAL BY ASSESSEE IS ARISING OUT OF THE ORDER OF CIT(A)-XX, KOLKATA IN APPEAL NO.127/CIT(A)-XX/WD-35(4)/08-09/KOL DATED 08.11.201 0. ASSESSMENT WAS FRAMED BY ITO, WARD-35(4), KOLKATA U/S 143(3)(II) OF THE INCOME-TAX ACT, 2962 (HEREINA FTER REFERRED TO AS THE ACT) VIDE HIS ORDER DATED 30.09.2007. 2. THE SOLE ISSUE IN THIS APPEAL OF ASSESSEE IS AGA INST THE ORDER OF CIT(A) CONFIRMING ACTION OF ASSESSING OFFICER IN DISALLOWING INTEREST BY APPLYING PROVISIONS OF SECTION 40(A)(IA) OF THE ACT AS NO TDS WAS DEDUCTED BY ASSESSEE. FOR THIS, ASSESSEE HAS RAISED FOLLOWING GROUND NOS. 2 AND 3: 2) FOR THAT THE LD. CIT(A) ERRED IN CONFIRMING THE ORDER OF THE LD. A.O DISALLOWING INTEREST PAID BY APPLYING THE PROVISIONS OF SECTION 40(A)(IA) ON WRONG PRESUMPTION THAT THE PARTIES TO WHOM INTEREST WAS PAYABLE SIGNED THE FORMS ON 3.4.2006 WHEN THE PARTIES DULY SIGNED, DATED AND SUBMITTED SUCH FORMS TO THE ASSESEE WELL BEFORE THE END OF THE YEAR AND THE ASSESSEE FOR THE PURPOSE OF FORWARDING THE SAID FORMS TO THE COMMISSIONER SIGNED THE SAME ON 3.4.2006 AND DEPOSITED SUCH FORM BEFORE CIT-XII ON 5.4.2006. 3) FOR THAT THE LD. CIT(A) ERRED IN CONFIRMING THE APPLICATION OF SECTION 40(A)(IA) ON WRONG PRESUMPTIONS AND UNINTENDED MISTAKE. IN RESP ECT OF EIGHT OF THE PARTIES AND IN SO FAR AS THE NINTH PARTY WAS CONCERNED THE SAID INTER EST WAS PAID TO ASSESSEES MINOR CHILDREN THE INCOME OF WHICH WAS ADDED WITH THE ASS ESSEE HIMSELF AND NO TAX WAS DEDUCTIBLE FOR PAYMENT TO SELF. 3. I HAVE HEARD RIVAL CONTENTIONS AND GONE THROUGH FACTS AND CIRCUMSTANCES OF THE CASE. THE ASSESSING OFFICER FOUND THAT ASSESSEE HAS PAID INTEREST TOTALING TO RS.4,33,345/- TO NINE PERSONS FROM WHOM UNSECURED LOANS WERE OBTAINED AND PAID INTEREST WITHOUT DEDUCTING TAX AT 2 ITA 295/K/2011 SRI MAHESH KR. MANDELIA A.Y.06-07 SOURCE. ASSESSING OFFICER INVOKED PROVISIONS OF SE CTION 40(A)(IA) OF THE ACT AND DISALLOWED INTEREST CLAIM AS EXPENDITURE BY ASSESSEE. AGGRIEV ED, ASSESSEE PREFERRED APPEAL BEFORE CIT(A), WHO ALSO CONFIRMED THE ACTION OF ASSESSING OFFICER BY NOTING THAT THE EXPLANATION OF THE ASSESSEE IS NOT ACCEPTABLE AS THE CONCERNED PARTIES HAVE FURNISHED DECLARATION IN FORM NO. 15G, WHICH WERE FILED BEFORE CIT-XII, KOLKATA ON 5.4.200 6 AND THESE DECLARATIONS FURNISHED ARE DATED 3.4.2006 AND, THEREFORE, ACCORDING TO HIM THE SE SHALL BE EFFECTIVE FROM THE SAME DATE. I FIND FROM MATERIAL PLACED BEFORE ME THAT FORM 15G F ROM THESE EIGHT PARTIES WERE OBTAINED BEFORE MARCH 31, 2006 AND THESE WERE SUBMITTED TO C IT-XII, KOLKATA VIDE LETTER DATED 5.4.2006 AND THE LAST DATE OF SUBMISSION OF THIS FORM 15G BE FORE CIT-XII, KOLKATA WAS 7.4.2006, THAT MEANS WITHIN THE DUE DATE FORMS 15G WERE SUBMITTED IN THE OFFICE OF CIT-XII, KOLKATA. I FIND FROM PARTICULARS FILED BEFORE US THAT ALL FORMS ARE DATED 31 ST MARCH, 2006 AND HENCE, CIT(A),S DECISION THIS ISSUE IS PERVERSE. IN VIEW OF THESE FACTS, I DELETE THE DISALLOWANCE AS THE ASSESSEE WAS NOT LIABLE TO DEDUCT TAX AT SOURCE AS THESE EIG HT PARTIES HAVE FURNISHED DECLARATIONS IN FORM 15G ON OR BEFORE 31 ST MARCH, 2006. ACCORDINGLY, DISALLOWANCE MADE BY AS SESSING OFFICER AND CONFIRMED BY CIT(A) IS WITHOUT ANY BASIS AND I DELE TE THE SAME. 4. IN RESPECT TO DISALLOWANCE OF INTEREST OF RS.22, 270/- PAID TO JAYANT MANDELIA, SON OF MAHESH KUMAR MANDELIA, THE PRESENT ASSESSEE, INCOME OF WHICH IS INCLUDED IN RETURN OF INCOME OF ASSESSEE AS SHRI JAYANT MANDELIA IS MINOR SON OF ASSESSEE. ONCE INCOME IS INCLUDED IN RETURN OF INCOME OF ASSESSEE, HE IS UNDER NO OBL IGATION TO DEDUCT TDS AND NO DISALLOWANCE BY INVOKING PROVISIONS OF SECTION 40(A)(IA) OF THE ACT CAN BE MADE IN THE CASE OF THE ASSESSEE. ACCORDINGLY, THE APPEAL OF THE ASSESSEE IS ALLOWED. 5. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED. 6. ORDER PRONOUNCED IN OPEN COURT. SD/- , (MAHAVIR SINGH) JUDICIAL ME MBER ( +, +, +, +,) )) ) DATED 2 ND AUGUST, 2011 -. /0 1 JD.(SR.P.S.) )* 2 '3 4)3'5- COPY OF THE ORDER FORWARDED TO: 3 ITA 295/K/2011 SRI MAHESH KR. MANDELIA A.Y.06-07 1 . %& / APPELLANT SHRI MAHESH KUMAR MANDELIA, 1, BRAJA KU MAR SETH LANE, KOLKATA-700 006. 2 '(%& / RESPONDENT, ITO, WD-35(4), KOLKATA. . 3 . * ( )/ THE CIT(A), KOLKATA 4. * / CIT, KOLKATA 5 . <= ' / DR, KOLKATA BENCHES, KOLKATA (3 '/ TRUE COPY, )* >/ BY ORDER, 0 /ASSTT. REGISTRAR .