Union Oils Pvt.Ltd., Ahmedabad V. The Add.CIT.,TDS Range, Ahmedabad

ITA 3064/AHD/2011

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 80468 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 10 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-10-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 16-10-2014
• Assessment Year: 2004-2005
• Appeal Filed On: 05-12-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: S V AGARWAL
• Keywords: Principle of natural justice; Condonation of delay; Ignorance of law
• Section: 201(1); 11

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, AHMEDABAD BEFORE SHRI MUKUL KR. SHRAWAT, JUDICIAL MEMBER AND SHRI ANIL CHATURVEDI , ACCOUNTANT MEMBER ITA NO S . 3063 & 3064 /AHD/20 1 1 A. Y S . 200 4 - 0 5 UNION OILS PVT. LTD., MARUTI HOUSE, 3 RD FLOOR, NR. ICICI B ANK, NR. TORAN DINING HALL, ASHRAM ROAD, AHMEDABAD . PAN: AAACU 2594E VS ADDITIONAL COMMISSIONER OF INCOME TAX, TDS RANGE, AHMEDABAD. (APPELLANT) (RESPONDENT) REVENUE BY : SHRI NIMESH YADAV , SR. D.R. , ASSESSEE(S) BY : SHRI S.V. AGARWA L, A.R. / DATE OF HEARING : 16 / 10 /201 4 / DATE OF PRONOUNCEMENT: 31 / 10 /201 4 / O R D E R PER SHRI MUKUL KUMAR SHRAWAT, JUDICIAL MEMBER BOTH THESE APPEALS HAVE BEEN FILED BY THE A SSESSEE ARISING FROM THE ORDERS OF LEARNED CIT(A) - XXI, AHMEDABAD, BOTH DATED 06.09.2010 , R ESPECTIVELY , GROUNDS RAISED ARE AS UNDER: GROUNDS OF ITA NO.3063/AHD 2011 1. THE LEARNED CIT(A) - XXI, AHMEDABAD HAS ERRED IN CONFIRMING PENALTY OF RS. 406624/ - U/S. 271C OF THE IT ACT ON THE GROUND THAT APPEAL AGAINST ORDER U/S. 201(1) & 201(1 A) FOR THE SAME HERE HAS BEEN DISMISSED BY HIM. (1.1) THE LEARNED CIT(A) HAS ERRED IN REJECTING THE APPEAL WITHOUT DECIDING THE SAME ON MERITS. 2. THE ORDER PASSED BY LEARNE D ADDL. CIT U/S. 201C IS TIME BARRED BECAUSE IT H PASSED AFTER THE EXPIRY OF FOUR YEARS FROM THE END OF THE FINANCIAL YEAR IN WHICH PAYMENT IS MADE AS PROVIDED IN SECTION 201(3) &HENCE PENALTY ORDER DO NOT SURVIVE. ITA NO S . 3063 & 3064 /AHD/201 1 UNION OILS PVT. LTD. VS. ACIT, TDS RANGE, AHMEDABAD FOR A.Y S . 200 4 - 0 5 - 2 3. THE QUANTUM OF PENALTY IS WRONG BECA USE THE RATE OF TDS APPLICABLE TO PAYEE IS 10% WHEREAS A.O. APPLIED 20% & FIXED LIABILITY OF TDS. THE DEDUCTEES ARE INDIVIDUAL ENTITIES AND NOT CORPORATE ENTITIES. GROUNDS OF ITA NO.306 4 /AHD 2011 1. THE LEARNED CIT(A) - XXI, AHMEDABAD HAS ERRED IN CONFIRMI NG LIABILITY OF ASSESSEE FIXED BY A.O. U/S. 201(1) & 201(1A) OF THE ACT AT RS. 691244 (U/S 201(1) RS. 406624 + U/S 201(1 A) RS. 284620) IN AS MUCH AS THE DEDUCTEE HAVE PAID INCOME TAX FOR A.Y.2004 - 05 ON THE AMOUNT OF INTEREST PAID TO THEM. 2. THE LEARNED C IT(A) HAS ERRED IN DISMISSING THE APPEAL ON THE GROUND THAT IT WAS LATE FILED & FURTHERED ERRED IN NOT DECIDING THE APPEAL ON MERITS. 3. THE LEARNED CIT(A) ERRED IN CONFIRMING ACTION OF A.O. IN APPLYING THE RATE OF TDS @ 20% INSTEAD OF 10 % BECAUSE THE DED UCTEES ARE INDIVIDUAL ENTITIES & NOT CORPORATE ENTITY. 2. AT THE OUTSET, IT IS WORTH TO MENTION THAT THESE APPEALS WERE BELATEDLY FILED; HOWEVER, THE DELAY WAS CONDONED AFTER THE IMPOSITION OF COST @ RS.50 PER DAY FOR THE DELAY , VIDE AN ORDER DATED 4.4.20 12 BY ITAT C BENCH AHMEDABAD IN ITA NO.3063 & 3064/AHD/2011. THE APPELLANT HAS PLACED ON RECORD A CHALLAN OF R S .19,350/ - PAID IN COMPLIANCE OF THE DIRECTIONS OF THE TRIBUNAL. SINCE, THE DELAY HAS ALREADY BEEN CONDONED; THEREFORE, THESE APPEALS ARE HEREBY DECIDED ON MERITS. 2.1 IT IS ALSO WORTH TO MENTION THAT LEARNED AR, MR . S.V. AGARWAL HAS STATED AT BAR THAT THE ISSUE OF ORDERS BEING TIME BARRED IS NOT TO BE PRESSED; HENCE, IN VIEW OF THE STATEMENT OF LEARNED AR THE RELATED GROUNDS ARE HEREBY DISMISSED . 2.2 ON PERUSAL OF THE ORDER OF THE LEARNED CIT(A) PASSED IN RESPECT OF SECTIONS 201(1) AND 201(1A), WE HAVE NOTED THAT NO ADJUDICATION WAS MADE ON MERITS AND THE APPEAL WAS DISMISSED BECAUSE IT WAS BELATEDLY FILED. RELEVANT PARAGRAPH IS EXTRACTED BELOW: 5. ) IN THIS CASE, THE APPEAL WAS FILED LATE BY 67 DAYS. APPLICATION DATED 9/6/2010 IN TWO PAGES IS ALREADY IN FILE. I HAVE EXAMINED THIS APPLICATION. THIS APPLICATION FOR CONDONATION OF DELAY IS DISMISSED AND REJECTED BECAUSE THERE ITA NO S . 3063 & 3064 /AHD/201 1 UNION OILS PVT. LTD. VS. ACIT, TDS RANGE, AHMEDABAD FOR A.Y S . 200 4 - 0 5 - 3 ARE A FEW HUNDREDS OF C.AS, ADVOCATES, ITPS IN AHMEDABAD. THE APPELLANT SHOULD HAVE APPROACHED ANY ONE OF THEM TO FILE THIS APPEAL WELL IN TIME. 'IGNORANCE OF LAW CANNOT BE AN EXCUSE FOR BREAKING IT'. AS PER THIS PRINCIPLE, THIS APPEAL IS DISMISSED AND THE MER ITS ARE NOT DISCUS SED. 2.3 SINCE, THE MAIN APPEAL WAS DISMISSED BY LEARNED CIT(A), THEREFORE IN CONSEQUENCE THEREUPON THE APPEAL FILED AGAINST THE PENALTY LEVIED U/S. 271(1)(C) HAS ALSO BEEN DISMISSED BY LEARNED CIT(A). 3. BEFORE US , LEARNED AR HAS STATED THAT THE ASSESS EE HAS SUFFICIENT REASON FOR NON DEDUCTION OF TDS BECAUSE THE COMPANY HAD GONE IN LIQUIDATION AND DECLARED AS SICK UNIT BY BIFR. FURTHER, HE HAS ALSO PLEADED THAT IF AT ALL THE DEFAULT OF THE ASSESSEE IS FOUND THEN THE SAME SHOULD BE TO THE EXTENT OF 10% R ATE OF TDS AND NOT 20% BECAUSE BOTH THE PARTIES ARE THE PROPRIETORSHIP CONCERN; HENCE, ASSESSED IN THE STATUS OF INDIVIDUAL. BEFORE US , A SHORT COMPILATION HAS BEEN FILED PLACING CERTAIN EVIDENCES IN RESPECT OF THIS CLAIM. 4. ON THE OTHER HAND, FROM THE SIDE OF THE REVENUE, LEARNED SR.D.R., MR. NIMESH YADAV HAS OBJECTED THE FILING OF EVIDENCES AT THIS STAGE OF SECOND APPEAL AND PLEADED THAT THE ASSESSEE HAS ALWAYS DEFAULTED IN FILING OF APPEAL WITHIN THE TIME PRESCRIBED; THEREFORE, DO NOT DESERVE ANY SYMP ATHY; HENCE, THE VIEW TAKEN BY THE REVENUE AUTHORITIES SHOULD BE CONFIRMED. 5. HEARING THE SUBMISSIONS OF BOTH THE SIDES AND AFTER CONSIDERING THE TOTALITY OF THE FACTS AND CIRCUMSTANCES OF THE CASE, WE ARE OF THE VIEW THAT THIS MATTER SHOULD GO BACK TO THE FILE OF THE LEARNED CIT(A) BECAUSE HE HAS NOT DECIDED THE ISSUE INVOLVED ON MERITS. LEARNED CIT(A) HAD ITA NO S . 3063 & 3064 /AHD/201 1 UNION OILS PVT. LTD. VS. ACIT, TDS RANGE, AHMEDABAD FOR A.Y S . 200 4 - 0 5 - 4 DISMISSED THE APPEAL BY NOT GRANTING CONDONATION OF DELAY OF 67 DAYS . B UT WE ARE OF THE VIEW THAT A LITIGANT SHOULD NOT BE THROWN OUT OF THE LITIGATIO N WITHOUT GRANTING OPPORTUNITY OF HEARING. SIDE BY SIDE, WE ARE ALSO OF THE VIEW THAT IF THE DELAY IN FILING THE APPEAL IS EXPLAINABLE THEN IN THE INTEREST OF NATURAL JUSTICE CONDONE THE SAME AND DECIDE THE MATTER ON MERITS. IN ANY STATUTE THE CONDITION O F LIMITATION IS INFRINGED KEEPING IN MIND GENERAL WELFARE SO THAT A LIMITATION SHOULD BE PRESCRIBED TO STREAMLINE THE PROCEEDINGS. BUT SIDE BY SIDE, A JUDICIAL AUTHORITY HAS TO KEEP IN MIND THE GENERAL WELFARE SO THAT AN UNDUE HARDSHIP SHOULD NOT BE FACED BY A LITIGANT. FOR THIS LEGAL PROPOSITION, WE HEREBY PLACE RELIANCE UP ON THE DECISION OF HON BLE APEX COURT IN THE CASE OF COLLECTOR LAND ACQUISITION VS. MST K ATTIJI AS REPORTED IN 167 ITR 471 (SC) AND DIRECT LEARNED CIT(A) TO CONDONE THE DELAY AND DE CIDE THIS APPEALS ON MERITS. WITH THESE DIRECTIONS , THE ISSUE IS RESTORED BACK FOR DENOVO CONSIDERATION, NEEDLESS TO SAY, AFTER PROVIDING ADEQUATE OPPORTUNITY OF HEARING TO THE ASSESSEE. FOR QUICK DISPOSAL, WE HEREBY DIRECT THE APPELLANT TO SUO MOTU APPEAR BEFORE LEARNED CIT(A) WITHIN 30 DAYS ON RECEIPT OF THIS ORDER OF THE TRIBUNAL AND MAKE ALL POSSIBLE EFFORTS TO GET THESE TWO APPEALS DECIDED AT AN EARLY DATE BY EXTENDING FULL CO - OPERATION. WITH THESE DIRECTIONS, THE GROUNDS RAISED MAY BE TREATED AS ALLOW ED BUT FOR STATISTICAL PURPOSE ONLY. 6. IN THE RESULT, BOTH THE APPEALS ARE ALLOWED FOR STATISTICAL PURPOSE S ONLY. SD/ - SD/ - ( ANIL CHATURVEDI ) ( MUKUL KR. SHRAWAT ) ACCOUNTANT MEMBER J UDICIAL MEMBER AHMEDABAD; DATED 31 / 10 / 20 1 4 PRABHAT KR. KESARWANI , SR. P . S . ITA NO S . 3063 & 3064 /AHD/201 1 UNION OILS PVT. LTD. VS. ACIT, TDS RANGE, AHMEDABAD FOR A.Y S . 200 4 - 0 5 - 5 / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. / CONCERNED CIT 4. ( ) / THE CIT(A) - III, AHMEDABAD 5. , , / DR, ITAT, AHMEDABAD 6. / GUARD FILE . / BY ORDER, / ( DY./ ASSTT.REGISTRAR) , / ITAT, AHMEDABAD