BRANCH MANAGER, STATE BANK OF INDIA, SME BRANCH, Jaipur V. ITO (TDS), Kota

ITA 342/JPR/2017

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 2044 (ITAT-JAIPUR)
• Duration Of Justice: 5 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-10-2017
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Assessment Year: 2014-2015
• Appeal Filed On: 03-05-2017
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: POONAM ROY DCIT DHK
• Section: 201(1)

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES (SMC), JAIPUR JH HKKXPAN] YS[KK LNL; ] DS LE{K BEFORE: SHRI BHAGCHAND, ACCOUNTANT MEMBER VK;DJ VIHY LA-@ ITA NO. 342/JP/2017 FU/KZKJ.K O'K Z@ ASSESSMENT YEAR : 2014-15 BRANCH MANAGER, STATE BANK OF INDIA, SME BRANCH, OPP MODI COLLEGE, 602, DADABARI EXT., KOTA. CUKE VS. INCOME TAX OFFICER (TDS), KOTA. TAN NO.: JDHS 10884 G VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY : SHRI DINESH KUMAR JKTLO DH VKSJ LS@ REVENUE BY : SMT. POONAM ROY (DCIT) LQUOKBZ DH RKJH[K@ DATE OF HEARING : 03/10/2017 MN?KKS'K .KK DH RKJH[K @ DATE OF PRONOUNCEMENT : 04/10/2017 VKNS'K@ ORDER PER: BHAGCHAND, A.M. THIS IS AN APPEAL FILED BY THE ASSESSEE EMANATES FR OM THE ORDER OF LD. CIT(A), ALWAR DATED 01/02/2017 FOR THE A.Y. 2014-15, WHEREIN THE ASSESSEE HAS RAISED SOLE EFFECTIVE GROUND OF APPEAL, WHICH IS AS UNDER:- 1. THAT THE ASSESSING AUTHOIRTY HAS GROSSLY ERRED IN TREATING THE LEAVE TRAVEL CONCESSION OF RS. 4,43,133/- REIMBURSE D TO SHRI R.K. CHOWDHARY AN EMPLOYEE OF THE APPELLANT AS PERQ UISITES WHICH IS PART OF SALARY AND RAISING A DEMAND OF RS. 1,71,426/- ON THE APPELLANT FOR NON DEDUCTION OF TDS U/S 201/2 01(1A) OF THE ACT AND THE APPELLATE AUTHORITY HAS GROSSLY ERRED IN SUSTAINING THE SAME. ITA 342/JP/2017_ BRANCH MANAGER VS ITO TDS 2 2. THE BRIEF FACTS OF THE CASE ARE THAT THE STATE BA NK OF INDIA (DEDUCTOR OF THE TDS), SME BRANCH, DADABARI EXT. KOT A HAS MADE REIMBURSEMENT OF BILL OF FOREIGN LEAVE CONCESSION D UDAI VIA PORT BLAIR UP TO HAVELOCK) OF RS. 4,43,133/- TO SHRI R.K. CHAUDHARY, CHIEF MANAGER DURING THE YEAR UNDER CONSIDERATION. THE ASSESSING OFFICER OBSERVED THAT THE PROVISIONS OF SECTION 192 OF THE INCOME TAX ACT, 196 1 (HEREINAFTER REFERRED AS THE ACT) TREATING THE PAYMENT AS PART OF SALARY/ PERQUISITE ARE ATTRACTED AND TDS MUST HAVE BEEN DEDUCTED AS PER PROVISIONS OF LAW, WHICH HAS NOT BEEN DONE. THE ASSESSING OFFICER RAISED A DEMAND OF RS. 1,71,426/- FOR VIOLATION OF PROVISIONS OF SECTION 192 READ WITH SEC TION 201(1) OF THE ACT. 3. THE LD. CIT(A) SUSTAINED THE ADDITION BY HOLDING A S UNDER: 5.3 I HAVE CONSIDERED THE ORDER PASSED BY THE ITO( TDS) AND SUBMISSIONS FILED BY THE APPELLANT. THE FOLLOWING FACTS HAVE EMERGED; 1. THAT SH. R. K. CHOUDHARY IS AN EMPLOYEE OF STAT E BANK OF INDIA. 2. THAT SH. CHOUDHARY, AVAILED LEAVE TRAVEL CONCESS ION DURING THE PERIOD UNDER CONSIDERATION. 3. THAT SH. CHOUDHARY HAD TRAVELLED FROM KOTA-DELHI -PORT BLAIR- CHENNAI-DUBAI-DELHI-KOTA. AND THE BANK HAD REIMBURS ED THE ENTIRE COST OF TRAVEL AS PER HIS ENTITLEMENT. 4. THAT THE A.O HAS CONTENDED THAT THE BANK WAS REQ UIRED TO TDS FOR THE PAYMENT MADE ON ACCOUNT OF RE-IMBURSEMENT AS SH . CHAUDHARY HAD TRAVELLED ABROAD AND THE EXEMPTION TO DEDUCT TA X ON REIMBURSEMENT AS PERQUISITE IS AVAILABLE UNDER SECT ION 10(5) OF THE ITA 342/JP/2017_ BRANCH MANAGER VS ITO TDS 3 ACT AND RULE 2B OF THE IT RULES, 1962 FOR TRAVEL WI THIN INDIAN TERRITORY ONLY. THEREFORE, THE BANK IS HELD ASSESSE E IN DEFAULT FOR TDS U/S 192 OF THE ACT. ACCORDINGLY, A.O HAD PASSED ORD ER U/S 201(1)/201(1A) OF THE ACT RAISING A DEMAND OF RS. 1 ,71,426/-. 5. THAT THE BANK HAS CLAIMED THAT THE RE-IMBURSEMEN T WAS MADE ACCORDING TO THE PROVISION OF STATE BANK OF INDIA O FFICERS SERVICE RULES, 1992 AND THAT NO VIOLATION U/S 192 OF THE AC T WAS MADE. 5.3.2 I HAVE CONSIDERED THE ABOVE MENTIONED FACTS. THERE IS NO DOUBT THAT THE EMPLOYEE IN QUESTION HAD UNDERTAKEN-A JOURNEY TO DU BAI-A PLACE OUTSIDE THE TERRITORY OF INDIA AND THE EMPLOYER, WHICH IS S BI HAD REIMBURSED THE COST OF TRAVEL AS LTC. SECTION 10(5) OF THE ACT IS VERY CLEAR THAT THE EXEMPTION FOR LEAVE CONCESSION IS ALLOWED ONLY IF T HE JOURNEY IS UNDER TAKEN TO ANY PLACE IN INDIA. IN THIS CASE, THE JOURNEY IS TAKEN FOR A PLACE OUTSIDE INDIA, THEREFORE EXEMPTION UNDER SECTION 10(5) OF T HE ACT IS NOT AVAILABLE. SINCE, THE EMPLOYER, WHICH IS THE APPELLANT IN THIS CASE HAD FAILED TO DEDUCT TAX AS PER THE PROVISION OF SECTION 192 OF THE ACT, IT HAS RIGHTLY BEEN HELD AS ASSESSEE IN DEFAULT AS PER PROVISION OF SECTION 201 (1)/201(1A) OF THE ACT. ACCORDINGLY, THE APPELLANTS GROUND OF APPEAL IS DI SMISSED. 4. I HAVE HEARD BOTH THE SIDES ON THIS ISSUE. SHRI R.K. CHAUDHARY IS EMPLOYEE OF STATE BANK OF INDIA AND AVAILED LEAVE TR AVEL CONCESSION (LTC) AND HAD TRAVELLED FROM KOTA-DELHI-PORT BLAIR-CHENNA I-DUBAI-DELHI-KOTA AND THE BANK HAD REIMBURSED THE ENTIRE COST OF TRAVEL. THE BANK WAS REQUIRED TO DEDUCT TDS MADE ON ACCOUNT OF REIMBURSEMENT TO SHRI CHAUDHARY FOR TRAVELLING ABROAD AS THE EXEMPTION FROM DEDUCTION O F TAX ON REIMBURSEMENT AS PERQUISITE IS AVAILABLE U/S 10(5) OF THE ACT REA D WITH RULE 2B OF THE INCOME TAX RULES, 1962 FOR TRAVEL WITHIN INDIAN TERRI TORY ONLY. ITA 342/JP/2017_ BRANCH MANAGER VS ITO TDS 4 THEREFORE, THE ASSESSEE IS IN DEFAULT AS PER PROVISI ONS OF SECTION 192 OF THE ACT. IN MY CONSIDERED VIEW, THE REIMBURSEMENT OF THE TRAVEL OUTSIDE INDIA IS NOT EXEMPTED FROM TDS, THEREFORE, IN THE IN TEREST OF JUSTICE AND EQUITY, I RESTORE THE ISSUE TO THE FILE OF THE ASSE SSING OFFICER TO TREAT THE ASSESSEE IN DEFAULT ONLY IN RESPECT OF THE AMOUNT O F REIMBURSEMENT RELATED TO THE FOREIGN TRAVEL. HENCE, APPEAL OF THE ASSESSE E IS PARTLY ALLOWED FOR STATISTICAL PURPOSES ONLY. 5. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS PAR TLY ALLOWED FOR STATISTICAL PURPOSES ONLY. ORDER PRONOUNCED IN THE OPEN COURT ON 04/10/2017. SD/- HKKXPAN (BHAGCHAND) YS[KK LNL;@ ACCOUNTANT MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 04 TH OCTOBER, 2017 *RANJAN VKNS'K DH IZFRFYFI VXZSFKR @ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ @ THE APPELLANT- THE BRANCH MANAGER, STATE BANK OF IN DIA, KOTA. 2. IZR;FKHZ @ THE RESPONDENT- THE ITO(TDS), KOTA. 3. VK;DJ VK;QDR @ CIT 4. VK;DJ VK;QDRVIHY @ THE CIT(A) 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ @ DR, ITAT, JAIPUR 6. XKMZ QKBZY @ GUARD FILE (ITA NO. 342/JP/2017) VKNS'KKUQLKJ @ BY ORDER, LGK;D IATHDKJ @ ASST. REGISTRAR