Sh. Naresh Chand Rana, Sonepat V. CIT, Rohtak

ITA 2989/DEL/2014

• Counselvise Citation: [2017] 130 COUNSELVISE.COM (IT) 6322 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 10 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-03-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: E
• Next Hearing Date: 27-03-2017
• Assessment Year: 2008-2009
• Appeal Filed On: 15-05-2014
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Assessee Lawyers: RAJA
• Keywords: Revision of order; TDS; Set aside
• Section: 32; 147; 131; 68; 246; 69; 145; 27; 148; 54; 37; 6; 56; 263; 63; 132; 12; 28; 144; 10; 90; 154; 2; 11; 15; 271(1)(b); 139; 92

Judgement Text

1 ITA NO. 2989 /DEL/2014 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: E NEW DELHI BEFORE SHRI R. S. SYAL, ACCOUNTANT MEMBER AND SMT SUCHITRA KAMBLE , JUDICIAL MEMBER I.T.A .NO.- 2989/DEL/2014 (ASSESSMENT YEA R-2008-09) NARESH CHAND RANA S/O. SHRI CHANDER SINGH RANA VILL. & P.O FAZILPUR SONEPAT ACNPR1502M (APPELLANT) VS CIT ROHTAK (RESPONDENT) APPELLANT BY SHRI K. SAMPATH & SH. RAJA KUMAR, ADV RESPONDENT BY SH. RAJESH KUMAR, SR. DR ORDER PER SUCHITRA KAMBLE, JM THIS APPEAL IS FILED BY THE ASSESSEE AGAINST THE OR DER DATED 28/03/2014 PASSED BY CIT ROHTAK. 2. THE GROUNDS OF APPEAL ARE AS FOLLOWS:- 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE AND IN LAW THE ORDER U/S 263 OF THE INCOME-TAX ACT, 1961 PASSED BY THE COMMISSIONER OF INCOME-TAX, ROHTAK IS DEVOID OF JUR ISDICTION AS NO ERROR PREJUDICIAL TO THE INTEREST OF THE REVENUE HA S NEITHER BEEN IDENTIFIED NOR BROUGHT ON RECORD AND SO MUST BE QUA SHED; 2. ADDITIONALLY THE ORDER U/S 263 OF THE INCOME-TAX ACT, 1961 BASED ON ASSUMPTIONS, PRESUMPTIONS AND CONJECTURES AND NOT O N THE MATERIAL DATE OF HEARING 27.03.2017 DATE OF PRONOUNCEMENT 28.03.2017 2 ITA NO. 2989 /DEL/2014 ON RECORD OF THE PROCEEDINGS IS ERRONEOUS AND VITIA TED AND NOT BEING ACCORDING TO LAW MUST BE QUASHED; 3. THAT THE FINDINGS OF THE COMMISSIONER THAT ACTIV ITY OF PROVIDING MARKET SURVEY SERVICES BY THE ASSESSEE IS A PROFESS IONAL RECEIPT AND NOT INCOME FROM BUSINESS IS PER SE ERRONEOUS AND UN TENABLE AND MUST BE QUASHED. 4. THAT THE FINDINGS OF THE COMMISSIONER THAT THE I NTENTION OF THE ASSESSEE IS ALWAYS MALA-FIDE I.E. TO EVADE TAX BY N OT FILING THE INCOME-TAX RETURN ON TIME IS FALLACIOUS AND BASELES S AND UNTENABLE ON FACTS AND IN LAW AND UNSUSTAINABLE AS SUCH AND S O MUST BE QUASHED. 3. THE NOTICE U/S 148 OF THE INCOME TAX ACT WAS ISS UED ON 5/1/2011 TO THE ASSESSEE. AS PER REASONS RECORDED U/S 147 OF THE I NCOME TAX ACT, 1961, THE ASSESSEE RECEIVED PAYMENT OF RS. 25,10,728/-, DURIN G ASSESSMENT YEAR 2008- 09, ON WHICH TAX WAS DEDUCTED AT SOURCE AMOUNTING T O RS.2,81,667/-. THE A.O OBSERVED THAT THE INCOME OF RS.25,10,728/- ON A CCOUNT OF THE PAYMENT RECEIVED BY THE ASSESSEE WAS AN ESCAPED INCOME FOR THE ASSESSMENT YEAR 2008- 09 WITHIN THE MEANING OF SECTION 147 OF THE INCOME TAX ACT. THE ASSESSING OFFICER RECORDED THAT THE ASSESSEE DID NOT FILE ANY RETURN OF INCOME FOR THE ASSESSMENT YEAR 2008-09, THOUGH THE INCOME OF THE A SSESSEE WAS TAXABLE. ACCORDINGLY, NOTICE U/S 148 HAS BEEN ISSUED TO THE ASSESSEE ON 5/1/2011 AND SERVED UPON THE ASSESSEE ON 15/1/2011. THE ASSESSEE FILED RETURN OF INCOME ON 28/11/2011 IN RESPONSE TO THE NOTICE U/S 148 OF THE INCOME TAX ACT, 1961 DECLARING AN INCOME OF RS. 18,750/- AFTER CLAIMING DEDUCTION OF RS. 75,832/- UNDER CHAPTER VIA OF THE INCOME TAX ACT, 1961 AND C LAIMED A REFUND OF RS.2,85,790/-. 4. THE CIT ISSUED SHOW CAUSE NOTICE U/S 263(1) OF T HE INCOME TAX ACT, 1961 TO THE ASSESSEE ON 17/2/2014 FIXING THE CASE F OR 27/2/2014. THE CIT UNDER SECTION 263 OF THE ACT HELD THAT THE CLAIM OF THE REFUND OF RS.2,85,790/- OF THE ASSESSEE WAS NOT ACCEPTABLE. THE CIT FURTHE R HELD THAT THE ASSESSEE SHOULD HAVE FILED THE RETURN OF INCOME VOLUNTARILY WITHIN THE PRESCRIBED TIME LIMIT AFTER GETTING HIS ACCOUNTS AUDITED. SINCE TH E ASSESSEE FAILED TO GET HIS 3 ITA NO. 2989 /DEL/2014 ACCOUNTS AUDITED AND TO SUBMIT THE RETURN OF HIS IN COME TIMELY AND FURTHER HE ALSO FAILED TO AVAIL THE OPPORTUNITIES ALLOWED TO H IM TO FILE THE RETURN IN TIME. THE CIT OBSERVED THAT THE ASSESSEE FILED HIS RETURN ONLY AFTER THE ISSUE OF NOTICE U/S 148 WHICH IS WITHOUT AUDIT. THUS, THE CIT HELD THAT AS PER PROVISIONS OF SECTION 148, THE PROCEEDINGS ARE FOR SAFE GUARDING OF THE INTEREST OF REVENUE AND NOT FOR ISSUE OF REFUND. FURTHER AS PER SECTIO N 239(C) OF THE INCOME TAX ACT, 1961 THE CLAIM FOR REFUND CAN BE MADE WITHIN O NE YEAR FROM THE LAST DAY OF SUCH ASSESSMENT YEAR I.E. IN THIS CASE UP TO 31/3/2 010. THE CIT FURTHER HELD THAT THE A.O PASSED THE ORDER WITHOUT PROPER CONSID ERATION OF FACTS AND WITHOUT FOLLOWING THE LAW LAID DOWN BY THE LEGISLAT URE AND WITHOUT MAKING PROPER REQUISITE AND DESIRED ENQUIRIES. THUS, THE CIT DIRECTED THE ASSESSING OFFICER TO MAKE FRESH ASSESSMENT. 5. THE LD. AR SUBMITTED THAT THE ASSESSEE RECEIVED PAYMENT OF RS. 25,10,728/- DURING ASSESSMENT YEAR 2008-09, ON WHIC H TAX WAS DEDUCTED AT SOURCE AMOUNTING TO RS.2,81,667/-, THIS FACT WAS NE VER DISPUTED BY THE ASSESSING OFFICER AS WELL AS BY THE CIT. THERE WAS NO NEED TO FILE THE RETURN OF INCOME AS THE ASSESSEES INCOME WAS NOT TAXABLE AT ALL. THE ASSESSEE RIGHTLY FILED RETURN OF INCOME ON 28/11/2011 IN RESPONSE TO THE NOTICE U/S 148 OF THE INCOME TAX ACT, 1961 DECLARING AN INCOME OF RS. 18, 750/- AFTER CLAIMING DEDUCTION OF RS. 75,832/- UNDER CHAPTER VIA OF THE INCOME TAX ACT, 1961 AND CLAIMED A REFUND OF RS.2,85,790/-. THE CIT DOES NOT HAVE POWER TO REJECT THE CLAIM OF THE REFUND OF THE ASSESSEE AS THE SAME IS ANY WAYS AN EXCESS TAX AMOUNT PAID TO THE TAX AUTHORITIES. THE LD. AR FUR THER SUBMITTED THAT SECTION 239(C) OF THE INCOME TAX ACT, 1961 IS NOT AT ALL AP PLICABLE IN THE PRESENT CASE AS THE CLAIM FOR REFUND WAS MADE ONLY WHEN SECTION 148 NOTICE WAS ISSUED TO THE ASSESSEE. 6. THE LD. DR RELIED UPON THE ORDER OF THE CIT AND SUBMITTED THAT THE ASSESSEE FILED HIS RETURN ONLY AFTER THE ISSUE OF N OTICE U/S 148 THAT TO WITHOUT AUDIT. THUS, PROVISIONS OF SECTION 148 ARE FOR SAF E GUARDING OF THE INTEREST OF 4 ITA NO. 2989 /DEL/2014 REVENUE AND NOT FOR ISSUE OF REFUND. THE LD. DR SU BMITTED THAT AS PER SECTION 239(C) OF THE INCOME TAX ACT, 1961 THE CLAIM FOR R EFUND CAN BE MADE WITHIN ONE YEAR FROM THE LAST DAY OF SUCH ASSESSMENT YEAR I.E. IN THIS CASE UP TO 31/3/2010. THUS, CIT RIGHTLY HELD THAT THE A.O PASS ED THE ORDER WITHOUT PROPER CONSIDERATION OF FACTS AND WITHOUT FOLLOWING THE LAW LAID DOWN BY THE LEGISLATURE AND WITHOUT MAKING PROPER REQUISITE AND DESIRED ENQUIRIES. 7. WE HAVE HEARD BOTH THE PARTIES AND PERUSED ALL T HE RECORDS. THERE IS NO DISPUTE THAT THE TDS WAS DEDUCTED FROM THE INCOME O F THE ASSESSEE. IN FACT, THE TDS WAS DEDUCTED AT MUCH HIGHER SIDE. THUS, THE ASSESSEE IS ENTITLED FOR REFUND AS THE ASSESSEE HAS PAID THE TAXES IN EXCESS IN THE FORM OF TDS DEDUCTED BY THE PARTIES WHO MADE PAYMENT TO THE ASS ESSEE. THE CIT DOES NOT HAVE POWER TO REJECT THE CLAIM OF THE REFUND OF THE ASSESSEE AS THE SAME IS ANY WAYS AN EXCESS TAX AMOUNT PAID TO THE TAX AUTHORITI ES. SECTION 239(C) OF THE ACT IS NOT AT ALL APPLICABLE IN THE PRESENT CASE AS THE CLAIM FOR REFUND WAS MADE ONLY WHEN SECTION 148 NOTICE WAS ISSUED TO THE ASSE SSEE. THERE CAN BE NO DOUBT THAT SO LONG AS THE VIEW TAKEN BY THE ASSESSI NG OFFICER IS A POSSIBLE VIEW THE SAME OUGHT NOT TO BE INTERFERED WITH BY THE COM MISSIONER UNDER SECTION 263 OF THE ACT MERELY ON THE GROUND THAT THERE IS A NOTHER POSSIBLE VIEW OF THE MATTER. PERMITTING EXERCISE OF REVISIONAL POWER IN A SITUATION WHERE TWO VIEWS ARE POSSIBLE WOULD REALLY AMOUNT TO CONFERRING SOME KIND OF AN APPELLATE POWER IN THE REVISIONAL AUTHORITY. THIS SHOULD BE AVOIDED BY THE AUTHORITIES. THUS, THE ORDER UNDER SECTION 263 OF THE ACT PASSED BY THE CI T IS SET ASIDE. 8. IN RESULT, APPEAL OF THE ASSESSEE IS ALLOWED. THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 28 TH DAY OF MARCH, 2017. SD/- SD/- (R.S. SYAL) (SUCHITRA KAMBLE) ACCOUNTANT MEMBER JUDICIAL MEMBER 5 ITA NO. 2989 /DEL/2014 DATED: 28/03/2017 R. NAHEED * COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT R EGISTRAR ITAT NEW DELHI DATE 1. DRAFT DICTATED ON 28.03.2017 PS 2. DRAFT PLACED BEFORE AUTHOR 28.03.2017 PS 3. DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER .2017 JM/AM 4. DRAFT DISCUSSED/APPROVED BY SECOND MEMBER. JM/AM 5. APPROVED DRAFT COMES TO THE SR.PS/PS 28.03.2017 PS/PS 6. KEPT FOR PRONOUNCEMENT ON PS 7. FILE SENT TO THE BENCH CLERK 28.03.2017 PS 8. DATE ON WHICH FILE GOES TO THE AR 9. DATE ON WHICH FILE GOES TO THE HEAD CLERK. 10. DATE OF DISPATCH OF ORDER.