M/s. Logix Infratech (P) Ltd., New Delhi V. ACIT, New Delhi

ITA 3209/DEL/2017

• Counselvise Citation: [2021] 109 COUNSELVISE.COM (IT) 2401 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 9 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-02-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Assessment Year: 2014-2015
• Appeal Filed On: 22-05-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SOHAIL MALIK
• Keywords: TDS

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH D NEW DLEHI BEFORE SHRI K. NARASIMHA CHARY, JUDICIAL MEMBER AND SHRI B.R.R. KUMAR, ACCOUNTANT MEMBER ITA NO. 3209/DEL/2017 ASSESSMENT YEAR: 2014-15 LOGIX INFRATECH (P) LTD., VS. ACIT, CIRCLE 50(1) , 301A, WORLD TRADE TOWER, NEW DELHI BARAKHAMBA ROAD, CONNOUGHT PLACE, NEW DELHI PAN : AADCL8158L ITA NOS. 3210 & 3211/DEL/2017 ASSESSMENT YEAR: 2012-12 & 2014-15 LOGIX CITY DEVELOPERS (P) LTD., VS. ACIT, CIRCLE 50(1), 301A, WORLD TRADE TOWER, NEW DELHI BARAKHAMBA ROAD, CONNOUGHT PLACE, NEW DELHI PAN : AABCL9744L ITA NOS. 3212 & 3213/DEL/2017 ASSESSMENT YEAR: 2012-12 & 2014-15 LOGIX INFRASTRUCTURE (P) LTD., VS. ACIT, CIRCLE 5 0(1), 301A, WORLD TRADE TOWER, NEW DELHI BARAKHAMBA ROAD, CONNOUGHT PLACE, NEW DELHI PAN : AABCL4533H (APPELLANTS) (RESPONDENT) APPELLANTS BY : SH. B.K. AGGARWAL, AR MS. SWETA BANSAL, CA RESPONDENT BY: SH. SOHAIL MALIK, SR. DR DATE OF HEARING: 24.02.2021 DATE OF ORDER : 24.02.2021 2 ORDER PER K. NARASIMHA CHARY, J.M. CHALLENGING THE ORDERS DATED 20.03.2017 AND 21.03. 2017 PASSED BY THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS)-41 , NEW DELHI (THE LD. CIT(A), FOR THE ASSESSMENT YEARS 2012-13 AND 2 014-15, LOGIX INFRATECH (P) LTD., LOGIX CITY DEVELOPERS (P) LTD., AND LOGIX INFRASTRUCTURE (P) LTD. (THE ASSESSEES) PREFERRED THESE APPEALS. 2. BRIEF FACTS OF THE CASES ARE THAT THE ASSESSEE C OMPANIES PAID LEASE RENTS FOR ASSESSMENT YEARS 2012-13 AND 2014-15, WHI CH ARE RELEVANT FOR THE PURPOSE OF THESE APPEALS, TO NOIDA AUTHORITIY T OWARDS THE COST OF LAND ALLOTTED TO THE ASSESSEE FOR GROUP HOUSING PROJECT. SINCE THE NOIDA AUTHORITY VIDE LETTER NO. 149 DATED 04.04.2013 INFO RMED THE ASSESSEE THAT NO TAX SHOULD BE DEDUCTED ON THE LEASE RENT, THE AS SESSEE COULD NOT DEDUCT TDS ON SUCH PAYMENTS. LEARNED ASSESSING OFFI CER HELD THE ASSESSEE AS AN ASSESSEE IN DEFAULT AND MADE ADDITIO N U/S.194-1 OF THE INCOME-TAX ACT(THE ACT FOR SHORT). 3. ASSESSEE PREFERRED APPEAL AND THE LD. CIT(A) BY WAY OF THE IMPUGNED ORDER FOLLOWED THE DECISION OF HONBLE DEL HI HIGH COURT IN THE CASE OF RAJESH PROJECTS (INDIA) PVT. LTD. VS. CIT ( 2017) 78 TAXMANN.COM 263 (DELHI) AND HELD THAT THE ASSESSEE IS NOT TO BE TRE ATED AS AN ASSESSEE IN DEFAULT IN VIEW OF THE LETTER RECEIVED FROM NOIDA A UTHORITY, WHICH DISABLED THE ASSESSEE FROM DEDUCTING TDS ON THE PAYMENTS MAD E TO NOIDA. LEARNED CIT(A), HOWEVER, FURTHER HELD THAT IT DOES NOT ABSOLVE THE ASSESSEE FROM THE INTEREST LIABILITY U/S. 201(1A) O F THE ACT. IN VIEW OF THE 3 PROVISION OF FIRST PROVISO TO SECTION 201(1), SHE D IRECTED THE ASSESSING OFFICER TO MODIFY THE DEMAND AFTER RECALCULATING TH E INTEREST AMOUNT. 4. AGGRIEVED BY THE SAME, THE ASSESSEE PREFERRED TH IS APPEAL BEFORE US. 5. THE FACTS ARE SIMPLE AND GO UNCHALLENGED BY EITH ER OF THE PARTIES. AS A MATTER OF FACT, LEARNED CIT(A), WHILE FOLLOWIN G THE DECISION IN RAJESH PROJECTS (INDIA) PVT. LTD. (SUPRA), RECORDED A FIND ING THAT THE ASSESSEE IS NOT TO BE CONSIDERED AS AN ASSESSEE IN DEFAULT IN VIEW OF SPECIFIC REQUIREMENT OF NOIDA AUTHORITY NOT TO DEDUCT TDS ON THE PAYMENT S MADE TO THEM. IT COULD BE SEEN FROM SUCH JUDGMENT, THAT THE HONBLE HIGH COURT SPECIFICALLY STATED THAT SINCE THE PETITIONERS COUL D NOT MAKE THE DEDUCTIONS DUE TO THE INSISTENCE OF GNOIDA, A DIREC TION NEED TO BE ISSUED TO THE SAID AUTHORITY TO COMPLY WITH THE PROVISIONS OF LAW AND MAKE ALL PAYMENTS, WHICH WOULD HAVE BEEN OTHERWISE PART OF T HE DEDUCTIONS FOR THE PERIOD TILL THE END OF THE DATE OF SUCH JUDGMEN T, NAMELY 16.02.2017 AND ALL PAYMENTS PAYABLE SUBSEQUENT TO 16.02.2017 S HALL BE SUBJECT TO TDS. HONBLE HIGH COURT FURTHER OBSERVED THAT THE A MOUNTS WHICH ARE PAYABLE TOWARDS INTEREST ON THE PAYMENT OF LUMP SUM LEASE PREMIUM, IN TERMS OF THE LEASE, WHICH ARE COVERED BY SECTION 19 4A ARE COVERED BY THE EXEMPTION UNDER SECTION 194A(3)(F) AND THEREFORE, N OT SUBJECTED TO TDS AND ANY PAYMENT OF INTEREST ACCRUED IN FAVOUR OF GN OIDA BY ANY PETITIONER WHO IS A BANK TO THE GNOIDA, TOWARDS FIX ED DEPOSITS, ARE ALSO EXEMPT FROM TDS. APART FROM THESE DIRECTIONS, HONB LE COURT FURTHER DIRECTED THAT WHEREVER AMOUNTS HAVE BEEN PAID BY TH E PETITIONERS, TOWARDS TDS AS A RESULT OF THE COERCIVE PROCESS USE D BY THE REVENUE, THE GNOIDA SHALL MAKE APPROPRIATE ORDERS TO CREDIT/REIM BURSE SUCH 4 PAYMENTS; AND THAT IN CASE PAYMENTS ARE MADE THROUG H DEPOSIT, OVER AND ABOVE THE RENTAL AMOUNTS PAID TO THE GNOIDA WITHOUT TDS, THE INCOME TAX AUTHORITIES SHALL NOT PURSUE ANY COERCIVE PROCE EDINGS AND THE GNOIDA SHALL DULY REIMBURSE THE PETITIONERS FOR SUCH AMOUN TS. 6. ABOVE OBSERVATIONS MADE BY HONBLE HIGH COURT IN RAJESH PROJECTS (INDIA) PVT. LTD. CLEARLY GO TO SHOW THAT THE RELIE F GRANTED TO THE ASSESSEES WAS NOT ONLY IN RESPECT OF RENTS, BUT TO ALL AMOUNT S WHICH ARE PAID OVER AND ABOVE THE RENTAL AMOUNTS TO GNOIDA WITHOUT TDS. WE ARE, THEREFORE, OF THE CONSIDERED OPINION THAT SINCE THE ASSESSEE W AS DIRECTED NOT TO BE TREATED AS ASSESSEE IN DEFAULT AND IN VIEW OF THE D IRECTIONS OF THE HONBLE HIGH COURT IN RESPECT OF THE PAYMENTS MADE TO GNOID A OVER AND ABOVE THE RENTAL AMOUNTS, NO ADDITION COULD BE MADE IN TE RMS OF THE ORDERS OF THE LD. CIT(A) ALSO. WE DIRECT THE AUTHORITIES NOT TO ADD ANY AMOUNT ON THIS SCORE. 7. IN THE RESULT, APPEALS OF THE ASSESSEES ARE ALLO WED. ORDER PRONOUNCED IN THE OPEN COURT ON CONCLUSION OF VIRTUAL HEARING ON THIS THE 24 TH DAY OF FEBRUARY, 2021. SD/- SD/- (B.R.R. KUMAR) (K. NARASIMHA CHARY) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 24/02/2021 AKS