Appeal details
Counselvise Citation
[2016] 133 COUNSELVISE.COM (IT) 9581 (ITAT-AHMEDABAD)
Assessee PAN
Bench
Appeal Number
Duration Of Justice
2 month(s) 15 day(s)
Appellant
Respondent
Appeal Type
Income Tax Appeal
Pronouncement Date
03-02-2016
Appeal Filed By
Assessee
Order Result
Allowed
Bench Allotted
SMC
Next Hearing Date
02-02-2016
Assessment Year
2012-2013
Appeal Filed On
18-11-2015
Judgement Text
IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, AHMEDABAD BEFORE SHRI SHAILENDRA K. YADAV, JUDICIAL MEMBER ./ ITA NOS. 3246 & 3247/AHD/2015 / ASSESSMENT YEAR: 2011-12 & 2012-13 M/S. AQUAFIL POLYMERS CO. PVT. LTD., 202, 203, SHYAMAK COMPLEX, B/H. KAMDHENU COMPLEX, POLYTECHNIC, AHMEDABAD .. APPELLANT PAN : AABCA 7902 R VS ADDL. CIT, TDS RANGE, AHMEDABAD .. RESPONDENT ASSESSEE(S) BY : SHRI PARIN SHAH, AR REVENUE BY : SHRI P.L. KUREEL, SR - DR / DATE OF HEARING 02/02/2016 /DATE OF PRONOUNCEMENT 03/02/2016 / O R D E R THESE TWO APPEALS HAVE BEEN FILED BY THE ASSESSEE A GAINST SEPARATE ORDERS OF THE COMMISSIONER OF INCOME TAX ( APPEALS)-8, AHMEDABAD, BOTH DATED 04.09.2015, FOR ASSESSMENT YE ARS 2011-12 & 2012-1, CHALLENGING THE PENALTY IMPOSED U /S. 272A(2)(K) OF THE INCOME-TAX ACT OF RS.2,36,000/- ( AY 2011-12) AND RS.2,03,000/- (AY 2012-13) FOR LATE FILING OF T DS RETURNS. 2. IN THESE CASES, THE TAX WAS DEDUCTED AND DEPOSIT ED ON RECEIPT OF PAYMENT AND TDS RETURNS WERE FILED AFTER DEPOSIT OF (SMC) ITA NOS. 3246 & 3247/AHD/2015 AQUAFIL POLYMERS CO PVT LTD VS. ACIT AYS: 2011-12 & 2012-13 2 TAXES. SECTION 200(3) OF THE INCOME-TAX ACT PROVIDE D THAT ANY PERSON DEDUCTING ANY SUM SHALL AFTER PAYING THE TAX DEDUCTED TO THE CREDIT OF CENTRAL GOVERNMENT SHALL PREPARE S TATEMENTS FOR SUCH PERIOD AS MAY BE PRESCRIBED AND DELIVER TO THE PRESCRIBED INCOME-TAX AUTHORITY. PROVISION OF SECT ION 272A(2)(K) OF THE ACT PROVIDES FOR IMPOSITION OF PE NALTY FOR FAILURE TO DELIVER COPY OF STATEMENT WITHIN TIME SP ECIFIED IN SUB- SECTION (3) OF SECTION 200 OF RS.100/- FOR EVERY DA Y. THESE SECTIONS ALSO CLEARLY LAY DOWN THAT THE FILING OF Q UARTERLY STATEMENTS IS CONSEQUENTIAL TO PAYMENT OF TAXES. T HE DELAYED PAYMENT OF TAXES ITSELF IS THE REASONABLE CAUSE FOR LATE FILING OF QUARTERLY STATEMENT AND HENCE THE ASSESSEE IS NOT E XIGIBLE TO THE LEVY OF PENALTY. THE QUESTION OF FILING QUART ERLY STATEMENT WITHOUT DEPOSIT OF TAXES DOES NOT ARISE AND FOR DEL AY IN DEPOSIT OF TAXES UNDER SECTION 201(1A) OF THE ACT PROVIDES FOR CHARGING OF INTEREST, AS LAID DOWN IN THE CASE OF ACIT VS. K AMLESH AGARWAL, REPORTED IN 99 ITD 27 (AHD) (TM). WHEN TH E ASSESSEE IS PAID THE TAX WITH INTEREST AND THE TDS STATEMENT S ARE ALREADY FILED THOUGH BELATEDLY, THERE IS NO LOSS TO THE REVENUE, AS HELD BY HONBLE GUJARAT HIGH COURT IN THE CASE O F HARSIDDH CONSTRUCTION PVT LTD VS. CIT, REPORTED IN 244 ITR 4 17 (GUJ). SIMILAR VIEW HAS BEEN TAKEN BY THE CO-ORDINATE BENC H OF THIS (SMC) ITA NOS. 3246 & 3247/AHD/2015 AQUAFIL POLYMERS CO PVT LTD VS. ACIT AYS: 2011-12 & 2012-13 3 TRIBUNAL IN THE CASE OF GTPL INFONET PVT LTD VS. AC IT IN ITA NOS.2582 & 2583/AHD/2015, WHEREIN THE TRIBUNAL HAS HELD AS UNDER:- 7. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. WE FIND THAT THE ASSESSEE HAD F ULLY DEPOSITED THE AMOUNT OF TDS ALONG WITH INTEREST PRI OR TO THE ISSUANCE OF THE SHOW CAUSE NOTICE AND THE REASO N FOR LATE PAYMENT OF TAXES WAS FINANCIAL CRUNCH IN THE B USINESS OF THE ASSESSEE WHICH IN OUR VIEW CONSTITUTE A REAS ONABLE CAUSE FOR LATE FILING THE QUARTERLY STATEMENTS IN F ORM NOS. 24Q & 26Q AS THIS STATEMENT CAN ONLY BE FILED AFTER THE PAYMENTS OF TAXES. SINCE, FULL AMOUNT OF TDS ALONG WITH INTEREST HAS BEEN PAID BY THE ASSESSEE AND THEREFOR E, NO LOSS IS CAUSED TO THE REVENUE AND THE LATE FILING O F QUARTERLY STATEMENT IS TECHNICAL AND VENIAL BREACH OF PROVISION OF THE ACT. IN CASE OF THE ORIENTAL INSUR ANCE CO. LTD. (SUPRA), IT HAS BEEN HELD AS UNDER: 5. WE HAVE HEARD THE RIVAL PARTIES AND PERUSED THE MATERIAL ON RECORD. IN OUR CONSIDERED VIEW THE LD. CIT(A) WAS JUSTIFIED IN DELETING THE IMPUGNED PENAL TY. HE HAS GIVEN COGENT REASONS WHILE DELETING THE PENA LTY. THERE IS NO DISPUTE ABOUT THE FACT THAT THE APPELLA NT HAS DEPOSITED MOST OF AMOUNT OF THE TAX DEDUCTED AT SOURCE UNDER THE PROVISIONS OF THE ACT WITH THE GOVERNMENT WITHIN STIPULATED TIME. HOWEVER, WHERE THERE IS DELAY IN SUCH DEPOSITS, SAME HAS BEEN DEPOSITED WITH INTEREST. FURTHER, THE TAX DEDUCTED AT SOURCE FOR THE RELEVANT PERIOD WAS DEPOSITED BY THE APPELLANT ALONG WITH CHARGEABLE INTEREST BEFORE THE ISSUE OF SHOW CAUSE NOTICE FOR THE PENALTY UNDER REFERENCE. THE DEFAULT FOR WHICH PENALTY HAS BEEN L EVIED BY THE AO RELATES TO LATE SUBMISSION OF FORM NO.24Q AND 26Q OF THE IT RULES. THE ASSESSEE'S BELIEF CONSTITUTES A REASONABLE CAUSE WITHIN THE MEANING O F SEC.273B OF THE ACT. SEC.273B OF THE ACT LAYS DOWN THAT THE PENALTY SHALL NOT BE IMPOSED IN RESPECT OF A DE FAULT RELATING TO THE PROVISIONS MENTIONED THEREIN IF THE PERSON OR THE ASSESSEE CONCERNED CAN SHOW THAT THER E WAS A REASONABLE CAUSE FOR DEFAULT IN QUESTION. SEC TION (SMC) ITA NOS. 3246 & 3247/AHD/2015 AQUAFIL POLYMERS CO PVT LTD VS. ACIT AYS: 2011-12 & 2012-13 4 272A(2)(K) FALLS WITHIN THE AMBIT OF SEC.273B OF TH E ACT. IT IS OBSERVED THAT THE AO HAS LEVIED THE PENALTY I N A ROUTINE MANNER WITHOUT BRINGING THE FACTS ON RECORD TO ESTABLISH THAT THE APPELLANT COMMITTED THE DEFAULT WITHOUT A REASONABLE CAUSE. THE LD. CIT(A) HAS RELI ED ON THE DECISION OF HON'BLE SUPREME COURT IN THE CAS E OF HINDUSTAN STEEL LTD. VS. STATE OF ORISSA (SUPRA) AN D HON'BLE GUJARAT HIGH COURT IN THE CASE OF HARSIDDH CONSTRUCTION (P) LTD. VS. CIT WHICH ARE SQUARELY APPLICABLE TO THE FACTS OF ASSESSEE'S CASE. WE FIND NO INFIRMITY IN THE ORDER OF LD. CIT(A) AND UPHOLD THE SAME. THE GROUND RAISED BY THE REVENUE IS DISMISSED. IN CASE OF CIT(A) ELI LILLY AND CO. (INDIA) P. LTD. (SUPRA), IT HAS BEEN HELD AS UNDER: S.273B PROVIDES THAT IN CASE REASONABLE CAUSE IS SHOWN, PENALTY U/S 272A(2) MUST NOT BE LEVIED. APPELLANT COULDN'T FILE TDS RETURNS IN TIME SINCE T DS WAS DEPOSITED LATE ON ACCOUNT OF ACUTE SHORTAGE OF FUNDS. SINCE THE SAME IS A REASONABLE CAUSE, PENALT Y CANNOT BE LEVIED. IN CASE OF CIT VS. HARSIDDH CONSTRUCTION PVT. LTD.( SUPRA), IT HAS BEEN HELD AS UNDER: FURTHER, APPELLANT HAS DEPOSITED TDS ALONG WITH INTEREST. THUS, IT HAS COMPENSATED GOVT. FOR LATE PAYMENT OF TDS ENSURING NO LOSS TO THE REVENUE. IN CASE THERE IS NO LOSS TO THE REVENUE, THEN PENALTY U/S 272A(2) CANNOT BE LEVIED. IN CASE OF HINDUSTAN STEEL LTD. VS. STATE OF ORISA (SUPRA), IT HAS BEEN HELD AS UNDER: IN ANY CASE, LATE FILING OF TDS RETURNS IS MERELY A TECHNICAL OR VENIAL BREACH WHICH DOESN'T WARRANT LE VY OF PENALTY U/S 272A(K). IN VIEW OF ABOVE FACTS, WE ARE OF THE VIEW THAT THE RE WAS A REASONABLE CAUSE FOR NOT FILING THE QUARTERLY STATE MENT IN TIME WITHIN THE MEANING OF 273B OF THE ACT, WE, THE REFORE, DELETE THE PENALTY BY ALLOWING THE APPEALS OF THE A SSESSEE. (SMC) ITA NOS. 3246 & 3247/AHD/2015 AQUAFIL POLYMERS CO PVT LTD VS. ACIT AYS: 2011-12 & 2012-13 5 2.1 NOTHING CONTRARY WAS BROUGHT TO MY KNOWLEDGE. SO, FACTS BEING SIMILAR, FOLLOWING THE SAME REASONING AND IN VIEW OF THE ABOVE LEGAL DISCUSSIONS, I DELETE THE PENALTY OF RS .2,36,000/-FOR ASSESSMENT YEAR 2011-12 AND RS.2,03,000/- FOR ASSES SMENT YEAR 2012-13, LEVIED BY THE ASSESSING OFFICER U/S 272A(2)(K) OF THE INCOME-TAX ACT. 3. IN THE RESULT, BOTH THE APPEALS FILED BY THE ASS ESSEE ARE ALLOWED. ORDER PRONOUNCED IN THE COURT ON 3RD FEBRUARY, 2016 AT AHMEDABAD. SD/- ( SHAILENDRA K. YADAV ) JUDICIAL MEMBER AHMEDABAD; DATED 03/02/2016 BIJU T., PS / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ! ' ' # / CONCERNED CIT 4. ' ' # ( ) / THE CIT(A) 5. &'( ! , ' ! , / DR, ITAT, AHMEDABAD 6. (- . / GUARD FILE. / BY ORDER, TRUE COPY / ( DY./ASSTT.REGISTRAR) !', / ITAT, AHMEDABAD
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