Data Secure Solutions P.Ltd, New Delhi V. ITO, Ward-7(2), New Delhi

ITA 3272/DEL/2019

• Counselvise Citation: [2021] 108 COUNSELVISE.COM (IT) 1141 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 2 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-06-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2015-2016
• Appeal Filed On: 15-04-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: PRATHAM BHATIA
• Keywords: Opportunity of being heard; Additional evidence; TDS; Set aside
• Section: 68; 143(3); 20

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI BENCH: SMC-1 NEW DELHI BEFORE SHRI KUL BHARAT, JUDICIAL MEMBER AND SHRI O.P. KANT, ACCOUNTANT MEMBER [THROUGH VIDEO CONFERENCING] ITA NO.3272/DEL/2019 ASSESSMENT YEAR: 2015-16 M/S. DATA SECURE SOLUTIONS PVT. LTD., 1546, S.P. MUKHARJEE MARG, NEAR NOVELTY CINEMA, NEW DELHI VS. ITO, WARD-7(2), NEW DELHI PAN :AACCD4614Q (APPELLANT) (RESPONDENT) ORDER PER O.P. KANT, AM: THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST ORD ER DATED 29/01/2019 PASSED BY THE LEARNED COMMISSIONER OF IN COME TAX (APPEALS)-15, NEW DELHI [IN SHORT THE LD. CIT(A)] FOR ASSESSMENT YEAR 2015-16, RAISING FOLLOWING GROUNDS: 1. THE LD. COMMISSIONER OF INCOME TAX (APPEALS)-15, NEW DELHI ERRED IN CONFIRMING THE ADDITIONS OF RS.19,38,939/- U/S 68 OF THE IT ACT, 1961. WITHOUT PREJUDICE, THE ADDITION IS NO T MAINTAINABLE U/S 68 OF THE IT ACT, 1961. APPELLANT BY SH. PRATHAM BHATIA, CA RESPONDENT BY SH. R.K. GUPTA, SR.DR DATE OF HEARING 30.06.2021 DATE OF PRONOUNCEMENT 30.06.2021 2 ITA NO.3272/DEL/2019 2. THE LD. COMMISSIONER OF INCOME TAX (A)-15, NEW D ELHI ERRED IN CONFIRMING THE ADDITIONS OF RS.5,31,087/- U/S 68 OF THE IT ACT, 1961, PARTICULARLY ON REASONS DIFFERENT THAN THOSE TAKEN BY LD. ASSESSING OFFICER AND WITHOUT PROVIDING ANY OPPORTU NITY OF HEARING. WITHOUT PREJUDICE, THE ADDITION IS NOT MAI NTAINABLE U/S 68 OF THE IT ACT, 1961. 3. THE LD. INCOME TAX OFFICER ERRED IN CHARGING INT EREST 234A, 234B, 234C AND 234D OF THE IT ACT AND WITHOUT PREJUDICE T HE SAME ARE EXCESSIVE. 4. THE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS )-15, NEW DELHI, IS NON-SPEAKING. 5. THE APPELLANT CRAVES LEAVE TO ADD, AMEND OR ALTE R THE GROUNDS OF APPEAL. 2. BRIEFLY STATED FACTS OF THE CASE ARE THAT DURING T HE YEAR UNDER CONSIDERATION, THE ASSESSEE WAS ENGAGED IN TH E BUSINESS OF TRADING OF COMPUTER SOFTWARE ON SALE OF SERVICES AN D FILED RETURN OF INCOME ON 29/09/2015 DECLARING TOTAL INCOME OF 16,91,120/- . THE RETURN OF INCOME FILED BY THE ASSESSEE WAS SE LECTED FOR SCRUTINY AND STATUTORY NOTICES UNDER THE INCOME-TAX ACT, 1961 (IN SHORT THE ACT) WERE ISSUED AND COMPLIED WITH. THE SCRUTINY ASSESSMENT UNDER SECTION 143(3) OF THE ACT WAS COMP LETED 16/08/2017 WHEREIN ADDITIONS OF 19,38,393 AND 5,31,087/- HAVE BEEN MADE TO THE RETURNED INCOME. AGGRIEVED, T HE ASSESSEE FILED APPEAL BEFORE THE LEARNED CIT(A), HOWEVER, CO ULD NOT SUCCEED AND THE ADDITIONS MADE BY THE ASSESSING OFF ICER WERE SUSTAINED. AGGRIEVED, THE ASSESSEE IS BEFORE THE IN COME TAX APPELLATE TRIBUNAL (IN SHORT THE TRIBUNAL) RAISIN G THE GROUNDS AS REPRODUCED ABOVE. 3. BEFORE US, THE PARTIES APPEARED THROUGH VIDEO CONF ERENCE FACILITIES AND FILED PAPER-BOOK IN ELECTRONIC FORM. THE ASSESSEE ALSO FILED AN APPLICATION UNDER RULE 29 OF THE INCO ME TAX (APPELLATE TRIBUNAL) RULES FOR FILING ADDITIONAL EV IDENCES 3 ITA NO.3272/DEL/2019 CONTAINING ASSESSMENT ORDER OF VALUE ADDED TAX (VAT) AND VAT RETURNS ETC. 4. THE LEARNED COUNSEL OF THE ASSESSEE ADDRESSING THE GROUNDS RAISED SUBMITTED THAT THE LOWER AUTHORITIES HAVE NO T APPRECIATED THE CONTENTION OF THE ASSESSEE THAT SALE OF SOFTWAR E BY THE ASSESSEE ARE SUBJECTED TO SERVICE TAX AS WELL AS SA LES TAX (VAT) AND THEREFORE SAME SALE HAS BEEN REPORTED TWICE FOR THE PURPOSE OF SERVICE TAX AS WELL AS SALES TAX AND THEREFORE C OMBINED TURNOVER OF SERVICE TAX ON SALES TAX REPORTED IN VA T RETURN IS HIGHER THAN THE TURNOVER DECLARED IN THE INCOME-TAX RETURN. THE LEARNED COUNSEL SUBMITTED THAT IN VIEW OF THE ADDIT IONAL EVIDENCES FILED CONTAINING ASSESSMENT ORDER OF THE VAT, THE DOUBTS RAISED BY THE AO/LD. CIT(A) CAN BE CLEARED. HE SUBMITTED THE ISSUE IN DISPUTE MAY BE RESTORED BACK TO THE FI LE OF THE ASSESSING OFFICER FOR VERIFICATION OF THE ADDITIONA L EVIDENCE FILED BY THE ASSESSEE. 5. THE LEARNED DR THOUGH RELIED ON THE ORDER OF THE L OWER AUTHORITIES, DID NOT OBJECT FOR RESTORING THE MATTE R BACK TO THE FILE OF THE LEARNED ASSESSING OFFICER. 6. WE HAVE HEARD RIVAL SUBMISSION OF THE PARTIES ON T HE ISSUE IN DISPUTE AND PERUSED THE RELEVANT MATERIAL ON REC ORD. THE ISSUE IN DISPUTE IN THE INSTANT APPEAL IS REGARDING THE D IFFERENCE IN TURNOVER REPORTED IN VAT RETURN AS WELL AS INCOME-T AX RETURN. THE CONTENTION OF THE ASSESSEE THAT CERTAIN SALES OF TH E SOFTWARE HAVE BEEN SUBJECTED TO BOTH SERVICE TAX AS WELL AS SALES TAX AND THEREFORE THE TOTAL TURNOVER REPORTED IN VAT RETURN IS HIGHER AS COMPARED TO INCOME-TAX RETURN. IN SUPPORT OF ITS CO NTENTION, BEFORE US THE ASSESSEE HAS FILED ADDITIONAL EVIDENC E AS FOLLOWS: 4 ITA NO.3272/DEL/2019 1. ASSESSING ORDER, VIDE FORM DVAT 24, DATED 9 TH JANUARY, 2019 PASSED BY DVAT ASSESSING OFFICER. 2. DVAT RETURN VIDE FORM DVAT 16 ALONG WITH RETURN VER IFICATION FORM VIDE FORM DVAT 56 FOR FIRST QUARTER OF FY 2014 -15. 3. DVAT RETURN VIDE FORM DVAT 16 ALONG WITH RETURN VER IFICATION FORM VIDE FORM DVAT 56 FOR THE SECOND QUARTER OF 20 14-15 4. DVAT RETURN VIDE FORM DVAT 16 ALONG WITH RETURN VER IFICATION FORM VIDE FORM DVAT 56 FOR THE THIRD QUARTER OF FY 2014-15 5. DVAT RETURN VIDE FORM DVAT 16 ALONG WITH RETURN VER IFICATION FORM VIDE FORM DVAT 56 FOR THE FOURTH QUARTER FOR FY 2014-15 6.1 SINCE ISSUE-IN-DISPUTE IS LIMITED TO VERIFICATION OF TURNOVER REPORTED IN VAT RETURN VIS--VIS THE TURNOVER REPORT ED IN INCOME- TAX RETURN, WHICH CAN BE VERIFIED AFTER EXAMINATION OF ADDITIONAL EVIDENCES FILED BY THE ASSESSEE. IN THE FACTS AND C IRCUMSTANCES OF THE CASE AND IN THE INTEREST OF SUBSTANTIAL JUSTICE , WE SET ASIDE THE ORDERS OF LOWER AUTHORITIES ON THE ISSUE IN DIS PUTE AND RESTORE THE MATTER BACK TO THE FILE OF THE LEARNED ASSESSIN G OFFICER FOR DECIDING AFRESH AFTER VERIFYING THE EVIDENCES FURNI SHED BY THE ASSESSEE. IT IS NEEDLESS TO MENTION THAT THE ASSESS EE SHALL BE AFFORDED ADEQUATE OPPORTUNITY OF BEING HEARD. THE G ROUNDS OF THE APPEAL ARE ACCORDINGLY ALLOWED FOR STATISTICAL PURP OSES. 7. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOW ED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 30 TH JUNE, 2021 SD/- SD/- (KUL BHARAT) (O.P. KANT) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 30 TH JUNE, 2021. RK/- (DTDS) COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 5 ITA NO.3272/DEL/2019 3. CIT 4. CIT(A) 5. DR ASST. REGISTRAR, ITAT, NEW DELHI