Ghaziabad Development Authority, New Delhi V. ACIT (TDS), Ghaziabad

ITA 3474/DEL/2012

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 65749 (ITAT-DELHI)
• Duration Of Justice: 3 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-10-2012
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: C
• Next Hearing Date: 15-10-2012
• Assessment Year: 2004-2005
• Appeal Filed On: 02-07-2012
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: AROOP KR SINGH
• Assessee Lawyers: O P SAPRA
• Keywords: Opportunity of being heard; Period of limitation; Competent authority; Condonation of delay

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES: C NEW DELHI BEFORE SHRI UBS BEDI, JM AND SHRI J.SUDHAKAR REDDY, AM ITA NO: 3474/DEL/2012 ASSESSMENT YEAR : - 2004-05 GHAZIABAD DEVELOPMENT AUTHORITY VS. ACIT(TDS) VIKAS PATH, HAPUR ROAD GHAZIABAD (UP) GHAZIABAD PAN: : AAALG 0072 C (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI O.P.SAPRA, ADV. RESPONDENT BY : SH. AROOP KR.SINGH, SR.D.R. O R D E R PER J.SUDHAKAR REDDY, ACCOUNTANT MEMBER THIS IS AN APPEAL FILED BY THE ASSESSEE DIRECTED AG AINST THE ORDER OF THE CIT(A), GHAZIABAD DATED 27.01.2012 FOR THE AY 2004 -05. 2. THE REGISTRY HAS CALCULATED THAT THE APPEAL IS BARRED BY LIMITATION BY 433 DAYS. THAT ASSESSEE DISPUTES THE SAME AND SU BMITS THAT THE ORDER OF THE CIT(A) THOUGH DATED 27.01.2011 BUT WAS RECEIVED ON 25.02.2011 AND THE LAST DATE FOR FILING OF APPEAL WAS 24.04.2011 AND H ENCE THE DELAY IS 365 DAYS AND NOT 433 DAYS. THE ASSESEE FILED A PETITION FOR CONDONATION OF DELAY AS WELL AS A SEQUENCE OF EVENTS TO EXPLAIN THE SAME. 3. WE HAVE HEARD MR.O.P.SUPRA THE LD. COUNSEL FOR THE ASSESEE AND MR. AROOP K SINGH, THE LD.DR. CONSEQUENT TO THE ITAT P ASSING ITS ORDER ON 31.03.2008, THE AO PASSED A CONSEQUENTIAL ORDER NUL LIFYING THE OUTSTANDING 2 DEMAND ON 17.09.2008. THERE AFTER THE AO PASSED A F RESH ORDER U/S. 201 AND 201(1A) ON 26.11.2009. THE ASSESSE FILED AN APPEAL BEFORE THE CIT(A) GHAZIABAD, WHO DISPOSED OF THE SAME ON 27.01.2011. THE ASSESSEE CLAIMS THAT THIS ORDER WAS COMMUNICATED TO IT ON 25.02.20 11. 4. IN THE MEANWHILE THE ASSESEE HAS FILED AN APPLIC ATION U/S. 154 ON 26.11.2009 BEFORE THE AO. AGAIN ON 10.10.2011 THE ASSESSE FILED ANOTHER APPLICATION U/S.154 BEFORE THE ITO(TDS). AS NO ORDE R HAS BEEN PASSED BY THE AO AND ON BOTH THESE APPLICATIONS U/S154 DATED 26.0 7.2009 AND 10.10.2011, THE ASSESSEE FILED A REMINDER ON 15.12.2011. ON THA T DATE THE ASSESSEE WAS SERVED WITH THE ORDER DATED 16.01.2012 PASSED BY TH E AO DISMISSING THE APPLICATION U/S.154 FILED BY THE ASSESSEE. THERE AF TER THE ASSESSEE TOOK STEPS TO FILE THIS APPEAL ON 02.07.2012. 5. FROM AN EXAMINATION OF ALL THESE DATES AND EVENT S, WE ARE OF THE CONSIDERED OPINION THAT THE DELAY IN FILING OF THE APPEAL HAS TO BE CONDONED FOR THE REASON THAT THE ASSESSEE HAD A GENUINE AND BONA FIDE BELIEF THAT ITS GRIEVANCE WOULD BE ADDRESSED IN THE APPLICATIONS FI LED BEFORE THE AO. THIS IS NOT A CASE WHERE THE ASSESEEE WAS GROSSLY NEGLIGENT . IT CANNOT BE SAID THAT THE ASSESEE ABSOLUTELY CALLOUS IN FILING THE APPEAL. IN FACT THIS IS THE SECOND ROUND OF LITIGATION AND THE ASSESSEE HAS BEEN PURSU ING THE LITIGATION IN ONE FORM OR OTHER. 6. THE HON`BLE SUPREME COURT IN A CIVIL APPEAL NO 2 395/2008 IN THE CASE OF IMPROVEMENT TRUST LUDHIANA VS. UJAKAR SINGH AND ANO THER VIDE JUDGMENT DATED 09.02.2010 HELD AS FOLLOWS:- 3 UNLESS MALA FIDES ARE WRIT LARGE, DELAY SHOULD BE CONDONED. (54.6 KIB, 1,251 DLS) MATTERS SHOULD BE DISPOSED OF ON MERITS AND NOT TEC HNICALITIES THE APPELLANT, A LOCAL AUTHORITY, ACQUIRED LAND BEL ONGING TO ONE OF THE RESPONDENTS FOR A DEVELOPMENT SCHEME IN 1988. AS TH E APPELLANT DID NOT PAY THE COMPENSATION AMOUNT DESPITE NOTICE, THE PROPERT Y WAS AUCTIONED AND SALE CONFIRMED IN FAVOUR OF THE HIGHEST BIDDER IN 1992. THE BIDDER DEPOSITED THE SALE PROCEEDS. THE APPELLANT THEN 'WOKE UP FROM ITS SLUM BER' AND FILED OBJECTIONS BEFORE THE SINGLE JUDGE FOR SETTING ASIDE THE AUCTI ON SALE. EVEN IN THESE PROCEEDINGS, THE APPELLANT DID NOT APPEAR AND THE S AME WERE DISMISSED FOR NON- APPEARANCE. THE SALE DEED WAS EXECUTED IN FAVOUR OF THE HIGHEST BIDDER. THE APPELLANT THEN FILED AN APPEAL BEFORE THE DISTRICT JUDGE WHICH WAS BARRED BY LIMITATION BY A COUPLE OF MONTHS. THIS APPEAL WAS D ISMISSED ON THE GROUND THAT THERE WAS NOT SUFFICIENT GROUND FOR CONDONATION OF DELAY. ONMISTAKEN ADVICE, THE APPELLANT FILED A SECOND APPEAL TO THE HIGH COURT W HICH WAS THEREAFTER TREATED BY THE COURT AS A REVISION APPLICATION. THIS WAS AL SO DISMISSED. THE APPELLANT THEN FILED A REVIEW PETITION WHICH WAS ALSO DISMISS ED. AGAINST THAT THE APPELLANT FILED A SLP WHICH WAS ALSO DELAYED. THE DELAY IN FI LING THE SLP WAS CONDONED AND THE QUESTION BEFORE THE SUPREME COURT WAS WHETH ER THE DISTRICT JUDGE WAS JUSTIFIED IN DISMISSING THE FIRST APPEAL ON THE GRO UND OF DELAY. HELD ALLOWING THE APPEAL: (I) WHILE CONSIDERING AN APPLICATION FOR CONDONATIO N OF DELAY NO STRAIT-JACKET FORMULA IS PRESCRIBED TO COME TO THE CONCLUSION IF SUFFICIENT AND GOOD GROUNDS HAVE BEEN MADE OUT OR NOT. EACH CASE HAS TO BE WEIG HED FROM ITS FACTS AND THE CIRCUMSTANCES IN WHICH THE PARTY ACTS AND BEHAVES. FROM THE CONDUCT, BEHAVIOUR AND ATTITUDE OF THE APPELLANT IT CANNOT BE SAID THA T IT HAD BEEN ABSOLUTELY CALLOUS AND NEGLIGENT IN PROSECUTING THE MATTER; (II) JUSTICE CAN BE DONE ONLY WHEN THE MATTER IS FO UGHT ON MERITS AND IN ACCORDANCE WITH LAW RATHER THAN TO DISPOSE IT OF ON SUCH TECHNICALITIES AND THAT TOO AT THE THRESHOLD; (III) UNLESS MALAFIDES ARE WRIT LARGE ON THE CONDUC T OF THE PARTY, GENERALLY AS A NORMAL RULE, DELAY SHOULD BE CONDONED. IN THE LEGAL ARENA, AN ATTEMPT SHOULD ALWAYS BE MADE TO ALLOW THE MATTER TO BE CONTESTED ON MERITS RATHER THAN TO THROW IT ON SUCH TECHNICALITIES. APART FROM THE ABO VE, THE APPELLANT WOULD NOT HAVE GAINED IN ANY MANNER WHATSOEVER, BY NOT FILING THE APPEAL WITHIN THE PERIOD OF LIMITATION. IT IS ALSO WORTH NOTICING THA T DELAY WAS ALSO NOT THAT HUGE, WHICH COULD NOT HAVE BEEN CONDONED, WITHOUT PUTTING THE RESPONDENTS TO HARM OR 4 PREJUDICE. IT IS THE DUTY OF THE COURT TO SEE TO I T THAT JUSTICE SHOULD BE DONE BETWEEN THE PARTIES; (IV) ALSO OBSERVED THAT AS THE AUCTION PURCHASER H AD BEEN PUT TO INCONVENIENCE AND HARASSMENT AND HAD NOT GOT ANY FRUITS FOR THE SALE PROCEEDS PAID IN 1992, IT SHOULD BE PAID COSTS OF RS.50,000/-. 7. APPLYING THE PROPOSITIONS LAID DOWN THEREIN TO T HE FACTS OF THE CASE WE CONDONE THE DELAY AND ADMIT THE APPEAL. 8. ON MERITS THE GROUNDS READ AS FOLLOWS:- 1. THAT ACIT(TDS) HAS ERRED IN LAW AS WELL AS ON F ACTS OF THE CASE BY PASSING THE ORDER UNDER SECTION 201/201(1A) READ WITH SECTI ON 254 OF THE INCOME TAX ACT, 1961, WHILE THE THEN ITO(TDS) HAD ALREADY DELE TED THE DEMAND BY PASSING THE ORDER ON 17.9.2008, AND THEREFORE THE ORDER AGA IN PASSED THOUGH HAD CONCLUDED IS ARBITRARY, UNJUST, ILLEGAL ON VARIOUS LEGAL AND FACTUAL GROUNDS INCLUDING THE FOLLOWING. (I) THE LD.AO HAS NOT VERIFIED FROM THE RECORDS THAT AP PEAL EFFECT HAD ALREADY BEEN GIVEN BY HIS PREDECESSOR IN ACCORDANCE WITH THE CBDT INSTRUCTIONS AS WERE BINDING UPON HIM AND DEMAND WA S REDUCED TO NIL AS PER DEPARTMENTAL RECORD (DCR). (II) THE APPELLANT IS NOT AN AUTHORITY TO ACQUIRE THE LA ND AND PAYMENT OF COMPENSATION UNDER THE LAND ACQUISITION ACT, 1894. ONLY ADM(LA) IS THE AUTHORITY EMPOWERED TO ACQUIRE THE LAND AND PAYMENT OF COMPENSATION THEREOF. (III) THAT PAYMENTS OF COMPENSATION/ENHANCED COMPENSATION S WERE MADE BY CHEQUES IN THE NAME OF SPECIAL JUDGE, GHAZIABAD ON THE DIRECTIONS OF ADM(LA), GHAZIABAD THE COMPETENT AUTHORITY UNDER THE LA ACT, 1894. (IV) THAT THE APPELLANT WAS NOT LIABLE FOR DEDUCTION OF TDS AS PER PROVISIONS OF S.194A OF THE INCOME TAX ACT, 1961. (V) THAT CBDT INSTRUCTION NO.275/109/9-IT(B) DT. 21.9.9 4 CLEARLY SPELL OUT THE PROVISIONS OF S.194A OF THE INCOME TAX ACT, 196 1 AND AS PER INSTRUCTION APPELLANT IS NOT LIABLE FOR DEDUCTION O F TAX AT SOURCE AND CBDT INSTRUCTION IS BINDING ON ALL THE DEPARTMENTAL AUTH ORITIES. (VI) THAT THE IMPUGNED ORDER OF THE THEN ACIT(TDS) CREAT ING THE DEMAND OF RS.6,03,857/- AND COMMISSIONER OF INCOME TAX (APPEA LS) ORDER CONFIRMING THE ORDER OF ACIT(TDS) DESERVE TO BE CAN CELLED/ANNULLED. 9. THE LD.COUNSEL FOR THE ASSESSEES SOLE CONTENTIO N BEFORE US IS THAT ONCE THE ORDER HAS BEEN PASSED BY THE A.O. UNDER SECTION 251 OF THE INCOME TAX ACT, 1961 ON 17.9.2008, TO REDUCE THE DEMAND, WITHO UT RECALLING THIS ORDER, 5 NO FURTHER ORDER CAN BE PASSED. HE FURTHER SUBMITS THAT THE COMPENSATION AND ENHANCED COMPENSATION WERE MADE BY CHEQUES IN T HE NAME OF SPECIAL JUDGE, GHAZIABAD ON THE DIRECTIONS OF ADM(LA), GHAZ IABAD WHO IS THE COMPETENT AUTHORITY UNDER THE LAND ACQUISITION ACT, 1984. 10. THE LD.D.R. RELIED ON THE ORDER OF THE COMMISSI ONER OF INCOME TAX (APPEALS) AND SUBMITTED THAT THE TRIBUNAL IN THE FI RST ROUND OF APPELLATE PROCEEDINGS HAS REJECTED THE CONTENTIONS OF THE ASS ESSEE ON MERITS AND THE ASSESSING OFFICER AS WELL AS THE COMMISSIONER OF IN COME TAX (APPEALS) HAD ONLY FOLLOWED THE BINDING DECISION OF THE TRIBUNAL. 11. COMING TO THE ORDER DT. 17.9.2008 PASSED UNDER SECTION 251 OF THE INCOME TAX ACT, 1961, HE SUBMITTED THAT NOTHING TUR NS ON IT AS THE ASSESSING OFFICER HAD PASSED A FRESH ORDER UNDER SECTION 201/ 201(1A) OF THE INCOME TAX ACT, 1961, ON 26.11.2009, CONSEQUENT TO THE TRIBUNA L RESTORING THE MATTER BACK TO THE FILE OF THE ASSESSING OFFICER. 12. AFTER HEARING RIVAL CONTENTIONS, WE FIND THAT T HE FIRST APPELLATE AUTHORITY HAS REPRODUCED THE DIRECTIONS OF THE TRIBUNAL AT PA RA 5.2 OF HIS ORDER WHICH IS EXTRACTED FOR READY REFERENCE. 3. DURING THE HEARINGS, THE LD.AR ALSO SUBMITTED T HE COMPENSATION RECEIVED DOES NOT RELATE THE CURRENT ASSESSMENT YEA R IN QUESTION. IT PERTAINS TO VARIOUS YEARS. AS A RESULTS, THE AR ARGUES THAT TH E COMPENSATION NEEDS TO BE SPREAD OVER AND IN THIS REGARD, HE HAS RELIED ON TH E EXTRACT OF PAGE 6501 FROM THE COMMENTARY WRITTEN BY PITHISURIA FILED BEFORE U S. 4. NONE WAS PRESENT FOR THE REVENUE. HAVING FOUND THAT THE PROVISIONS OF S.204 AND 194A ARE CLEAR ON THE ISSUE OF PERSON RE SPONSIBLE FOR PAYING, WE PROCEED TO DECIDE THE CASE ON MERITS. WE HAVE HEAR D THE ABOVE SUBMISSIONS OF THE ASSESSEE AND PERUSED THE PROVISIONS OF S.204, 2 01(1) AND 194A. CLAUSE (III) OF S.204 RELATING TO MEANING OF PERSON RESPONSIBLE FOR PAYING, MAKES A REFERENCE TO THE WORDS PAYER, HIMSELF, THUS MAKIN G NO AMBIGUITY ABOUT THE PAYER TO MAKE THE DEDUCTION OF TDS IN THIS REGARD. IN THE INSTANT CASE, IT IS THE 6 GDA, WHICH HAS PAID THE COMPENSATION AND CONSEQUENT LY, MAKING IT CLEAR THAT THE PRINCIPAL OFFICER OF GHAZIABAD DEVELOPMENT AUTH ORITY IS THE PAYER WITHIN THE MEANING OF S.204 OF THE INCOME TAX ACT, 1961. THER EFORE, WE ARE OF THE OPINION THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEA LS) DOES NOT CALL FOR ANY INTERFERENCE ON THIS ISSUE. REGARDING THE ISSUE OF CHARGEABILITY OF COMPENSATION AMONG MANY AYS WE FIND THAT THIS ISSUE HAS NOT BEEN RAISED BEFORE THE LOWER AUTHORITIES. THEREFORE, IT IS NOT LEGALLY CORRECT TO ADJUDICATE ON SUCH ISSUE. CONSEQUENTLY, WE ARE OF THE OPINION TO REFER THE IS SUE TO THE FILE OF ASSESSING OFFICER WHO SHALL EXAMINE AND TAKE AN APPROPRIATE A CTION AFTER GIVING REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESS EE. 13. FROM THE ABOVE IT IS CLEAR THAT THE TRIBUNAL HA D REJECTED THE CONTENTIONS OF THE ASSESSEE AND THIS HAS ATTAINED FINALITY FOR THE REASON THAT THE ASSESSEE HAD NOT CHALLENGED IT BEFORE THE HONBLE HIGH COUR T. THE ASSESSEE HAS NOT FURNISHED INFORMATION AND DETAILS DESPITE GRANT OF OPPORTUNITY, BEFORE THE ASSESSING OFFICER. UNDER THE CIRCUMSTANCES WE UP H OLD THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS). WE CAN NOT D EVIATE FROM THE FINDINGS OF THE TRIBUNAL ON THIS ISSUE IN THE FIRST ROUND OF APPELLATE PROCEEDINGS. 14. IN THE RESULT, ON MERITS THE APPEAL FILED BY T HE ASSESSEE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 30 TH OCTOBER, 2012. SD/- SD/- (U.B.S. BEDI) (J.SUDHAKAR REDDY) JUDICIAL MEMBER ACCOUNTANT MEMBE R DATED: THE 30 TH OCTOBER, 2012 *MANGA 7 COPY OF THE ORDER FORWARDED TO: 1. APPELLANT; 2.RESPONDENT; 3.CIT; 4.CIT (A); 5.DR; 6.GUARD FILE BY ORDER DY. REGISTRAR 1. DATE OF DICTATION: 2. DRAFT PLACED BEFORE THE AUTHOR ON: 3. DRAFT PROPOSED AND PLACED BEFORE SECOND MEMBER ON: 4. DRAFT DISCUSSED/APPROVED BY THE SECOND MEMBER ON: 5. APPROVED DRAFT CAME TO SR.P.S. ON: 6. DATE OF PRONOUNCEMENT : 7. FILE SENT TO BENCH CLERK ON : 8. DATE ON WHICH FILE GIVEN TO HEAD CLERK ON: 9. DATE OF DISPATCHING THE ORDER ON :