Food Corporation of India, Sitapur V. Income Tax Officer, Bareilly

ITA 32/LKW/2016

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 4653 (ITAT-LUCKNOW)
• Duration Of Justice: 1 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-03-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: misc
• Appeal Filed On: 27-01-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: R N SHUKLA
• Keywords: Opportunity of being heard

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH A , LUCKNOW BEFORE SHRI S UNIL KUMAR YADAV , JUDICIAL MEMBER AND SHRI. A. K. GARODIA , ACCOUNTANT MEMBER ITA NO. 32 TO 34/LKW/2016 ASSESSMENT YEAR: 2008 - 09 & 2006 - 07 FOOD CORPORATION OF INDIA DISTRIC T OFFICE 140 - B, LOHAR BAGH SITAPUR V. INCOME TAX OFFICER (TDS) BAREILLY T AN /PAN : AAACF0365N (APP ELL ANT) (RESPONDENT) APP ELL ANT BY: SHRI. R. N. SHUKLA, ADVOCATE RESPONDENT BY: SHRI. AMIT NIGAM, D.R. DATE OF HEARING: 24 02 201 6 DATE OF PRONOUNCEMENT : 17 03 201 6 O R D E R PER SUNIL KUMAR YADAV: THESE APPEALS ARE PREFERRED BY THE ASSESSEE AGAINST THE RESPECTIVE ORDERS OF THE LD. CIT(A) ALLEGING THEREIN THAT THE LD. CIT(A) HAS PASSED AN ORDER S WITHOUT HAVING ANY JURISDICTION. 2 . SINCE THESE APPEALS W ERE HEARD TOGETHER, THESE ARE BEING DISPOSED OF THROUGH THIS CONSOLIDATED ORDER. WE, HOWEVER, PREFER TO ADJUDICATE THESE APPEALS ONE AFTER THE OTHER. 3 . THROUGH THIS APPEAL, THE ASSESSEE HAS ASSAILED THE ORDER OF THE LD. CIT(A), INTER ALIA, ON THE FOLLOWING GROUNDS: - I.T.A. NO. 32/LKW/2016: 1. BECAUSE THE APPELLANT IS A LARGE CENTRAL GOVERNMENT UNDERTAKING ENGAGED IN THE WORK OF FOOD GRAIN PROCUREMENT AND : - 2 - : DISTRIBUTION WITHOUT ANY PROFIT MOTIVE AND PROPERLY DEDUCTED THE TAX AND DEPOSITED INTO CENTRAL GOVERNMEN T ACCOUNT FOR E - TDS RETURN OF 26Q FOR QUARTER - Q1. 2. BECAUSE THE CORE DISPUTE INVOLVED IN THE INSTANT APPEAL ARISES ONLY DUE TO NON - AVAILABILITY OF FILES FROM NSDL AT THE TIME OF SHOW - CAUSE NOTICE ISSUED BY THE ID. ASSESSING OFFICER AND THE TECHNICAL PROB LEMS WITH THE SERVER OF THE TRACES 3. BECAUSE ITA NO. 175/LKW/2014 HAD BEEN FILED FOR A.Y. 2008 - 09 FOR THE E - TDS RETURN FILED IN 26Q1 QUARTER BY THE DEPARTMENT AND HON'BLE ITAT VIDE ORDER DATED 14TH OCTOBER 2014 IN ITA NO. 175/LKW/2014 DISMISSED THE APPEAL OF THE DEPARTMENT AND RIGHTLY CONFIRMED THE ORDER OF CIT(A) - BAREILLY WHEREIN CIT(A) - BAREILLY SENT THE MATTER BACK TO ASSESSING AUTHORITY. 4. BECAUSE CORRECTION E - TDS RETURN FOR QUARTER - Q1 CORRECTION FILED ON 03.12.2012 VIDE RECEIPT NO.061160100029851 HAD BEEN ACCEPTED AND PROCESSED WITHOUT DEFAULT. 5. BECAUSE HON'BLE ITAT IN ITA NO. 175/LKW/2014 VIDE ORDER FOR 26Q1 QUARTER A.Y. 2008 - 09 DATED 14TH OCTOBER 2014 RESTORED THE ISSUE FOR VERIFICATION TO ASSESSING AUTHORITY AND NOT TO CJT(A) BAREILLY. HENCE IN V IEW OF THE OPENING PARAS OF THE ORDER PASSED IN APPEAL NO. 268/ITAT/2014 - 15 FOR E - TDS RETURN 26Q1 QUARTER - A.Y. 2008 - 09, WHICH HAD BEEN DISMISSED EX - PARTE BY COMMISSIONER OF INCOME TAX APPEAL BAREILLY VIDE ORDER DATED 02.11.2015 HAD BEEN REINSTITUTED/ADJUD ICATED WITHOUT JURISDICTION HENCE VOID AB INITIO. 6. WITHOUT PREJUDICE TO GROUND NO. 5 - BECAUSE THE APPEAL HAD BEEN DECIDED EX - PARTE BY COMMISSIONER OF INCOME TAX APPEAL BAREILLY VIDE ORDER DATED 02.11.2015 DESPITE THE FACT THAT THE APPELLANT HAD DULY FILE D THE ADJOURNMENT AND THE FACT IS MENTIONED IN THE IMPUGNED ORDER ITSELF. : - 3 - : 4 . DURING THE COURSE OF HEARING, THE LD. COUNSEL FOR THE ASSESSEE HAS INVITED OUR ATTENTION TO THE ORDER OF THE TRIBUNAL, WITH THE SUBMISSION THAT THE TRIBUNAL VIDE ITS ORDER DATED 14. 10.2014 IN THE FIRST ROUND OF APPEAL CONFIRMED THE ORDER OF THE LD. CIT(A) , WHO HAS DIRECTED THE INCOME TAX OFFICER FOR MAKING NECESSARY VERIFICATION OF THE DOCUMENT S AND IF THE TDS WAS DEDUCTED AND PAID IN TIME, HE MAY REVISE THE ORDER ACCORDINGLY. THROU GH THIS ORDER OF THE TRIBUNAL, THE TRIBUNAL HAS DIRECTED THE ASSESSING OFFICER TO PASS A CONSEQUENTIAL ORDER AND NO DIRECTION WAS ISSUED TO THE LD. CIT(A), BUT UNFORTUNATELY THE LD. CIT(A) SUO MOTU HAS TAKEN COGNIZANCE AND PASSED THE IMPUGNED ORDER CONFIRM ING THE ORDER O F THE ASSESSING OFFICER PASSED UNDER SECTION 201(1)/201(1A) OF THE ACT. 5 . THE LD. D.R. DID NOT DISPUTE THESE FACTS. 6 . HAVING CAREFULLY EXAMINED THE ORDERS OF THE LOWER AUTHORITIES AND THE AFORESAID ORDER OF THE TRIBUNAL IN THE LIGHT OF THE RIVAL SUBMISSIONS, WE FIND THAT WHILE DISPOSING OF THE APPEAL, THE TRIBUNAL HAS DIRECTED THE ASSESSING OFFICER (TDS) FOR MAKING VERIFICATION OF THE DOCUMENTS AND IF TDS WAS DEDUCTED AND PAID IN TIME, HE MAY REVISE THE ORDER ACCORDINGLY. NO DIRECTION AS SUCH WA S GIVEN TO THE LD. CIT(A), BUT IT IS NOT CLEAR AS TO HOW THE LD. CIT(A) HAS INTERPRETED THIS ORDER OF THE TRIBUNAL AND PASSED THE IMPUGNED ORDER. THE E ARLIER ORDER PASSED BY THE LD. CIT(A) WAS SET ASIDE BY THE TRIBUNAL AND THE MATTER WAS RESTORED TO THE A SSESSING OFFICER, THEREFORE, HE HAS NO JURISDICTION TO PASS THE IMPUGNED ORDER. THIS ORDER WAS IN FACT PASSED BY THE LD. CIT(A) WITHOUT APPLICATION OF MIND. THIS TYPE OF ACTION CANNOT BE EXPEC TED FROM SUCH A SENIOR OFFICER OF THE REVENUE. WE ACCORDINGLY SET ASIDE THE ORDER OF THE LD. CIT(A) AND DIRECT THE ASSESSING OFFICER TO PASS AN ORDER AS PER DIRECTIONS ISSUED BY THE TRIBUNAL IN ITS ORDER DATED 14.10.2014. ACCORDINGLY, THE APPEAL OF THE ASSESSEE IS ALLOWED. : - 4 - : 7 . IN THESE APPE ALS, THE ASSESSEE HAS ASSAILED THE ORDERS OF THE LD. CIT(A), INTER ALIA, ON THE FOLLOWING GROUNDS: - I.T.A. NO. 33 & 34/LKW/2016: GROUNDS RAISED IN I.T.A. NO. 3 3 /LKW/2016: 1. BECAUSE THE APPELLANT IS A LARGE CENTRAL GOVERNMENT UNDERTAKING ENGAGED IN THE WORK OF FOOD GRAIN PROCUREMENT AND DISTRIBUTION WITHOUT ANY PROFIT MOTIVE AND PROPERLY DEDUCTED THE TAX AND DEPOSITED INTO CENTRAL GOVERNMENT ACCOUNT. 2. BECAUSE THE CORE DISPUTE INVOLVED IN THE INSTANT APPEAL ARISES ONLY DUE TO NON - AVAILABILITY OF FILES FROM NSDL AT THE TIME OF SHOW - C AUSE NOTICE ISSUED BY THE ID. ASSESSING OFFICER AND THE TECHNICAL PROBLEMS WITH THE SERVER OF THE TRACES. 3. BECAUSE COURT BELOW WITHOUT TAKING INTO CONSIDERATION FACTS OF THE CASE PROPERLY, INTERMINGLED THE FACTS OF E - TDS RETURN OF 26Q1 QUARTER OF A.Y. 2 008 - 09 INTO ANOTHER FACTS OF E - TDS RETURN OF 24Q4 QUARTER A.Y. 2008 - 09 AND MISTAKENLY AND ERRONEOUSLY AND DISMISSED THE APPEAL BY DISPOSAL NO. 177 , 6. BECAUSE THE COMMISSIONER OF INCOME TAX WRONGLY AND ERRONEOUSLY WITHOUT APPLICATION OF MIND, CONFIRMED THE PENALTY IN APPEAL NO. 161/JCIT/TDS/BLY/2013 - 14 AND A.Y. 2006 - 07 AND CONFIRMED THE PENALTY OF RS.69090/ - VIDE IMPUGNED ORDER DATED 02.11.2015. 4. BECAUSE ITA NO. 175/LKW/2014 HAD BEEN FILED FOR A.Y. 2008 - 09 FOR THE ETDS RETURN FILED IN 26Q1 QUARTER BY THE DEPARTMENT AND HON'BLE ITAT VIDE ORDER DATED 14TH OCTOBER 2014 IN ITA NO. 175/LKW/2014 DISMISSED THE APPEAL OF THE DE PARTMENT. 5. BECAUSE JOINT COMMISSIONER OF INCOME TAX (TDS), BAREILLY VIDE ORDER DATED 17.06.2013 IMPOSED A PENALTY UNDER SECTION 271C OF RS.69090.00 WITH RESPECT TO SHORT DEDUCTION IN FORM NO.24Q4 FOR THE F.Y. 2005 - 06 RELEVANT TO A.Y. 2006 - 07 WITHOUT PRO VIDING PROPER OPPORTUNITY AND VERIFICATION OF DOCUMENTS. : - 5 - : UNDER SECTION 271C OF INCOME TAX ACT 1961 VIDE ORDER DATED 02.11.2015 WITHOUT TAK ING INTO CONSIDERATION SUBMISSION AND EVIDENCE FILED BY THE APPELLANT. 7. BECAUSE THE PENALTY U/S 271C OF INCOME TAX ACT 1961 CANNOT BE LEVIED FOR THE MISTAKES APPEARED IN THE ETDS RETURN AND WHICH AFTER MAKING MANUAL VERIFICATION OF DOCUMENTS. 8. BECAUS E IN CIT VS ELI LILLY & CO.. CIVIL APPEAL NO. 5114/2007 ALONG WITH BUNCH OF CIVIL APPEALS, HON'BLE APEX COURT HELD THAT, 'THE LIABILITY TO LEVY PENALTY CAN BE FASTENED ONLY ON THE PERSON WHO DOES NOT HAVE GOOD AND SUFFICIENT REASON FOR NOT DEDUCTING TAX AT SOURCE.' 9. BECAUSE HON'BLE ITAT IN ITA NO. 175/LKVW2014 FOR 26Q1 QUARTER A.Y. 2008 - 09 VIDE ORDER DATED 14TH OCTOBER 2014 RESTORED THE ISSUE FOR VERIFICATION TO ASSESSING AUTHORITY AND NOT TO CIT(A) BAREILLY. HENCE IN VIEW OF THE OPENING PARAS OF THE ORD ER PASSED IN APPEAL NO, 268/ITAT/2014 - 15 FOR 26Q1 QUARTER A.Y. 2008 - 09 WHICH HAD BEEN DISMISSED EX - PARTE BY COMMISSIONER OF INCOME TAX APPEAL BAREILLY VIDE ORDER DATED 02.11.2015 WAS REINSTITUTED \ AND ADJUDICATED WITHOUT JURISDICTION HENCE VOID AB - INITIO. GROUNDS RAISED IN I.T.A. NO. 3 4 /LKW/2016: 1. BECAUSE THE APPELLANT IS A LARGE CENTRAL GOVERNMENT UNDERTAKING ENGAGED IN THE WORK OF FOOD GRAIN PROCUREMENT AND DISTRIBUTION WITHOUT ANY PROFIT MOTIVE AND PROPERLY DEDUCTED THE TAX AND DEPOSITED INTO CENTRAL GOVERNMENT ACCOUNT. 2. BECAUSE THE CORE DISPUTE INVOLVED IN THE INSTANT APPEAL ARISES ONLY DUE TO NON - AVAILABILITY OF FILES FROM NSDL AT THE TIME OF SHOW - CAUSE NOTICE ISSUED BY THE ID. ASSESSING OFFICER AND THE TECHNICAL PROBLEMS WITH THE SERVER OF THE TR ACES : - 6 - : 3. BECAUSE COMMISSIONER OF INCOME TAX APPEALS BAREILLY WITHOUT TAKING INTO CONSIDERATION FACTS OF THE CASE PROPERLY, INTERMINGLED THE FACTS OF E - TDS RETURN OF 26Q4 QUARTER INTO ANOTHER FACTS OF E - TDS RETURN OF 26Q1 QUARTER AND MISTAKENLY AND ERRONEOU SLY DISMISSED THE APPEAL BY DISPOSAL NO. 178, MENTIONING WRONG APPEAL NO. 161/JCIT / TDS/BLY/ 2013 - 14 AND A.Y. 2006 - 07 AND PENALTY DEMAND OF RS.69090/ - IN THE IMPUGNED ORDER DATED 02.11.2015 ( CORRECT A.Y. 2008 - 09 AND IMPUGNED PENALTY U/S 271C RS.204430/ - ) 4 . BECAUSE ITA NO. 175/LKW/2014 HAD BEEN FILED FOR A.Y. 2008 - 09 FOR THE ETDS RETURN FILED IN 26Q1 QUARTER BY THE DEPARTMENT AND HON'BLE ITAT VIDE ORDER DATED 14TH OCTOBER 2014 IN ITA NO. 175/LKW/2014 DISMISSED THE APPEAL OF THE DEPARTMENT AND CONFIRMED THE ORDER OF CIT(A) - BAREILLY IN WHICH MATTER HAD BEEN SET ASIDE TO ASSESSING AUTHORITY FOR NECESSARY VERIFICATION OF THE DOCUMENTS. 5. BECAUSE JOINT COMMISSIONER OF INCOME TAX (TDS), BAREILLY VIDE ORDER 17.06.2013 IMPOSED A PENALTY UNDER SECTION 271C OF RS.20 4430.00 WI TH RESPECT TO SHORT DEDUCTION IN FORM NO.26Q4 FOR THE F.Y. 2007 - 08 VERIFICATION OF DOCUMENTS. 6. BECAUSE CORRECTION E - TDS RETURN FILED ON 09.04.2015 VIDE RECEIPT NO.061169600020476 HAD BEEN ACCEPTED AND PROCESSED WITHOUT DEFAULT HENCE THE IMPOSI TION OF PENALTY U/S 271C IS ILLEGAL AND CONTRARY TO PROVISION OF THE INCOME TAX ACT 1961. 7. BECAUSE THE PENALTY U/S 271C OF INCOME TAX ACT 1961 CANNOT BE LEVIED FOR THE MISTAKES APPEARED IN THE ETDS RETURN AND WHICH HAS BEEN RECTIFIED AFTER OBTAINING THE CONSOLIDATED FILES FROM NSDL AND FILING CORRECTION STATEMENT OF ETDS. 8. BECAUSE IN CIT VS ELI LILLY & CO.. CIVIL APPEAL NO. 5114/2007 ALONG WITH BUNCH OF CIVIL APPEALS. HON'BLE APEX COURT HELD THAT, 'THE LIABILITY TO LEVY PENALTY CAN BE FASTENED ONLY ON : - 7 - : THE PERSON WHO DOES NOT HAVE GOOD AND SUFFICIENT REASON FOR NOT DEDUCTING TAX AT SOURCE.' 9. BECAUSE THE COMMISSIONER OF INCOME TAX WRONGLY AND ERRONEOUSLY WITHOUT APPLICATION OF MIND CONFIRMED THE PENALTY UNDER SECTION 271C OF INCOME TAX ACT 1961 VIDE ORDER DATED 02.11.2015 WITHOUT TAKING INTO CONSIDERATION SUBMISSION AND EVIDENCE FILED BY THE APPELLANT. 10. BECAUSE HON'BLE ITAT IN ITA NO. 175/LKW/2014 VIDE ORDER FOR 26Q1 QUARTER A.Y. 2008 - 09 DATED 14TH O CTOBER 2014 RESTORED THE ISSUE FOR VERIFICATION TO ASSESSING AUTHORITY AND N OT TO CIT(A) BAREILLY. HENCE IN VIEW OF THE OPENING PARAS OF THE ORDER PASSED IN APPEAL NO. 268/ITAT/2014 - 15 FOR A.Y. 2008 - 09 DIS MISSED EX - PARTE BY COMMISSIONER OF INCOME TAX APPEAL BAREILLY VIDE ORDER DATED 02.11.2015 WAS REINST ITUTED AND ADJUDICATED WITHOUT JURISDICTION HENCE VOID AB INITIO. 8 . IN THIS CASE ALSO , THE LD. CIT(A) HAS ADJUDICATED THE APPEAL AGAINST THE ORDER OF THE ASSESSING OFFICER PASSED UNDER SECTION 271C OF THE ACT HAVING RELIED UPON THE ORDER OF THE TRIBUNAL DAT ED 14.10.2014. IN THAT ORDER, THE TRIBUNAL HAS RESTORED THE MATTER BACK TO THE ASSESSING OFFICER FOR PASSING CONSEQUENTIAL ORDER AFTER MAKING NECESSARY VERIFICATION. NO DIRECTION WAS ISSUED TO THE LD. CIT(A), BUT THE LD. CIT(A) HAS OBSERVED IN HIS ORDER THAT THROUGH THAT ORDER OF THE TRIBUNAL, THE TRIBUNAL HAS RESTORED THE MATTER TO THE FILE OF THE LD. CIT(A). THIS OBSERVATION OF THE LD. CIT(A) IS ALSO INCORRECT IN THE LIGHT OF THE ORDER OF THE TRIBUNAL DATED 14.10.2014. THEREFORE, THE FINDING OF THE LD . CIT(A) IS ON THE BASIS OF INCORRECT OBSERVATION AND HENCE THE ORDER OF THE LD. CIT(A) MAY BE SET ASIDE AND THE MATTER MAY BE RESTORED TO HIS FILE FOR RE - ADJUDICATION OF THE ISSUE AFRESH AFTER AFFORDING AN OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. : - 8 - : 9 . THE LD. D.R. DID NOT DISPUTE THESE FACTS. 10 . HAVING CAREFULLY EXAMINED THE ORDERS OF THE LOWER AUTHORITIES AND THE ORDER OF THE TRIBUNAL IN THE LIGHT OF THE RIVAL SUBMISSIONS, WE FIND THAT THE TRIBUNAL VIDE ITS ORDER DATED 14.10.2014 HAS RESTORED THE MATTER TO T HE FILE OF THE ASSESSING OFFICER TO PASS A CONSEQUENTIAL ORDER AFTER MAKING NECESSARY VERIFICATION, BUT THE LD. CIT(A) HAS WRONGLY OBSERVED THAT THE MATTER WAS RESTORED TO HIS FILE. THEREFORE, THE OBSERVATION OF THE LD. CIT(A) IS FACTUALLY INCORRECT. IN THE LIGHT OF THESE FACTS, WE SET ASIDE THE ORDER OF THE LD. CIT(A) AND RESTORE THE MATTER TO HIS FILE WITH A DIRECTION TO RE - ADJUDICATE THE APPEALS AFRESH AFTER AFFORDING AN OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 11 . IN THE RESULT, APPEAL OF THE ASSESSEE IN I.T.A. NO. 32/LKW/2016 IS ALLOWED AND THE APPEALS IN I.T.A. NO. 33 & 34/LKW/2016 ARE ALLOWED FOR STATISTICAL PURPOSES. ORDER WAS PRONOUNCED IN THE OPEN COURT ON THE DATE MENT I ONED ON THE CAPTION ED PAGE. SD/ - SD/ - [ A. K. GARODIA ] [ S UNIL KUMAR Y ADA V ] ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 17 TH 1 . APPELLANT MARCH , 2016 JJ: 2502 COPY FORWARDED TO: 2 . RESPONDENT 3 . CIT(A) 4 . CIT 5 . DR ASSISTANT REGISTRAR