CORNERVIEW CONSTRUCTION & DEVELOPERS PVT. LTD., MUMBAI V. ACIT (TDS) - CPC, GHAZIABAD

ITA 3652/MUM/2018

• Counselvise Citation: [2019] 112 COUNSELVISE.COM (IT) 0320 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 7 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-12-2019
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: C
• Assessment Year: 2016-2017
• Appeal Filed On: 28-05-2018
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: PADMAPANI BORA
• Keywords: TDS
• Section: 234E; 200A; 20

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, MUMBAI BEFORE SHRI SAKTIJIT DEY , JUDICIAL MEMBER AND SHRI S. RIFAUR RAHMAN , ACCOUNTANT MEMBER ITA NO. 3652 / MUM . /201 8 ( ASSESSMENT YEAR : 20 16 17 ) CORNERVIEW CONSTRUCTION & DEVELOPERS PVT. LTD. , BUILDING NO.10, 5 TH FLOOR ACME GROUP, SOLITAIRE PARK GURU HARGOVINDJI ROAD ANDHERI (E), MUMBAI 400 093 PAN AAFCC9548R . APPELLANT V/S ASSTT . COMMISSIONER OF INCOME TAX (TDS), CPC GHAZIABAD (U.P) . RESPONDENT ASSESSEE BY : SHRI RAVIKANT PATH A K REVENUE BY : SHRI PADMAPANI BORA DATE OF HEARING 16. 12 .2019 DATE OF ORDER 30.12.2019 O R D E R PER SAKTIJIT DEY. J.M. A FORESAID APPEAL HAS BEEN FILED BY THE ASSESSEE CHALLENGING THE ORDER DATED 31 ST MARCH 2018, PASSED BY THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) 59 , MUMBAI, PERTAINING TO THE ASSESSMENT YEAR 20 16 17 . 2 CORNERVIEW CONSTRUCTION & DEVELOPERS PVT. LTD. 2. THE DISPUTE IN THE PRESENT APPEAL IS CONFINED TO LEVY OF FEE UNDER SECTION 234E OF THE INCOME TAX ACT, 1961 (FOR SHORT 'THE ACT' ) WHILE PROCESSING THE TDS STATEMENT UNDER SECTION 200A OF THE ACT. 3. BRIEF FACTS ARE, DURING THE YEAR UNDER CONSIDERATION, THE ASSESSEE ENTERED INTO AN AGREEMENT WITH M/S. ACCENT CONSTRUCTION PVT. LTD., FOR PURCHASE OF 96 FLATS . V IDE ALLOTMENT LETTER DATED 29 TH OCTOBER 2015 T HE FLAT S WERE ALLOTTED TO THE ASSESSEE FOR A TOTAL CONSIDERATION OF ` 100,51,65,650. WHILE MAKING A PART PAYMENT OF THE SALE CONSIDERATION ON 29 TH OCTOBER 2015, THE ASSESSEE DEDUCTED TAX @ 1% UNDER SECTION 194IA OF THE ACT. HOWEVER, THE ASSESSEE PAID THE TDS AMOU NT IN FORM NO.26QB BELATEDLY. WHILE PROCESSING THE TDS STATEMENT S UNDER SECTION 200A OF THE ACT, THE ASSESSING OFFICER FINDING THAT SUCH STATEMENT S WAS NOT FILED WITHIN THE TIME PRESCRIBED UNDER THE STATUTE , LEVIED FEE UNDER SECTION 234E OF THE ACT. THOUGH , THE ASSESSEE CHALLENGED THE LEVY OF FEE UNDER SECTION 234E OF THE ACT BEFORE THE FIRST APPELLATE AUTHORITY, HOWEVER, IT WAS UNSUCCESSFUL. 4. WE HAVE HEARD THE RIVAL CONTENTION S AND PERUSED THE MATERIAL ON RECORD. AT THE OUTSET, THE LEARNED AUTHORISED REPRESENTATIVE FAIRLY SUBMITTED THAT THE ISSUE HAS BEEN DECIDED AGAINST THE ASSESSEE WHILE DISPOSING OFF APPEALS FILED BY THE ASSESSEE ON IDENTICAL ISSUE BEFORE THE TRIBUNAL. IN THI S CONTEXT, THE LEARNED AUTHORISED REPRESENTATIVE HAS 3 CORNERVIEW CONSTRUCTION & DEVELOPERS PVT. LTD. DRAWN OUR ATTENTION TO THE ORDER DATED 28 TH JUNE 2019, PASSED IN ITA NO.3285/MUM./2018 & ORS. THE LEARNED DEPARTMENTAL REPRESENTATIVE ALSO AGREED WITH THE AFORESAID SUBMISSION OF THE LEARNED AUTHORISED R EPRESENTATIVE. 5. HAVING CONSIDERED RIVAL SUBMISSIONS, WE FIND THAT WHILE DECIDING IDENTICAL ISSUE IN ASSESSEES OWN CASE IN THE ORDER REFERRED TO ABOVE, THE TRIBUNAL HAS HELD AS UNDER: 8. WE HAVE CONSIDERED RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. WE HAVE ALSO APPLIED OUR MIND TO THE DECISIONS RELIED UPON BY THE LEARNED AUTHORISED REPRESENTATIVE. THERE IS NO DISPUTE BETWEEN THE PARTIES WITH REGARD TO THE PRIMARY FACTS. VIDE ALLOTMENT LETTER DATED 29 TH OCTOBER 2015, NINETY SIX FLATS ALONG WIT H CAR PARKING SPACE WAS ALLOTTED TO THE ASSESSEE FOR A TOTAL CONSIDERATION OF ` 100,51,64,650, AND ON THE DATE OF ALLOTMENT ITSELF I.E., ON 29 TH OCTOBER 2015, THE ASSESSEE PAID A PART OF THE SALE CONSIDERATION AMOUNTING TO ` 55 CRORE TO THE DEVELOPER / BUI LDER AND WHILE MAKING SUCH PAYMENT, THE ASSESSEE IN COMPLIANCE TO THE PROVISIONS CONTAINED UNDER SECTION 194IA OF THE ACT HAS DEDUCTED TAX AT SOURCE @ 1%. SINCE THERE WAS A DELAY IN FILING THE TDS STATEMENTS AS PROVIDED UNDER SECTION 200(3) OF THE ACT, THE ASSESSING OFFICER WHILE PROCESSING THE TDS STATEMENTS UNDER SECTION 200A OF THE ACT HAS LEVIED FEE UNDER SECTION 234E OF THE ACT. CHALLENGING THE LEVY OF FEE UNDER SECTION 234E OF THE ACT, THE LEARNED AUTHORISED REPRESENTATIVE HAS MADE SUBMISSIONS BEFORE US, WHICH CAN BE SUMMARIZED AS UNDER: I) DUE TO PAUCITY OF SPACE IN FORM NO.26QB, ASSESSEE WAS COMPELLED TO DEPOSIT TDS IN SEPARATE CHALLANS CUM - STATEMENTS INSTEAD OF A SINGLE CHALLAN - CUM - STATEMENT. THEREFORE, LATE FEE SHOULD BE LEVIED IN RESPECT OF A SIN GLE CHALLAN CUM STATEMENT; II) PROVISION OF SECTION 194IA OF THE ACT IS NOT APPLICABLE AS THERE IS NO TRANSFER OF IMMOVABLE PROPERTY; III) SINCE FORM NO.26QB IS A CHALLAN CUM STATEMENT WHICH IS GENERATED ON THE VERY DATE OF PAYMENT OF TDS, IT DOES NOT COME WITHIN THE PURVIEW OF SECTION 200(3) OF THE ACT; AND 4 CORNERVIEW CONSTRUCTION & DEVELOPERS PVT. LTD. IV) THERE IS NO ADDITIONAL WORK LOAD ON THE DEPARTMENT AS THE ASSESSEE HAS FILED THE TDS STATEMENTS BEFORE THE DUE DATE OF FILING OF RETURN OF INCOME BY THE DEDUCTEES FOR THE ASSESSMENT YEAR 20 16 17. 9. INSOFAR AS ASSESSEES CONTENTION REGARDING APPLICABILITY OF SECTION 194IA OF THE ACT IS CONCERNED, WE ARE UNABLE TO ACCEPT THE SAME DUE TO FOLLOWING REASONS. UNDISPUTEDLY, AT THE TIME OF MAKING PAYMENT OF ` 55 CRORE TO THE SELLER OF THE FLATS, T HE ASSESSEE ITSELF HAS DEDUCTED TAX AT SOURCE IN COMPLIANCE TO THE PROVISIONS CONTAINED UNDER SECTION 194IA OF THE ACT. THUS, IT IS PATENT AND OBVIOUS THAT THE ASSESSEE AND THE SELLER OF THE FLATS HAVE TREATED THE TRANSACTION OF SALE OF FLATS AS A TRANSACT ION COMING WITHIN THE PURVIEW OF SECTION 194IA OF THE ACT. IN ANY CASE OF THE MATTER, THE DEDUCTEE HAS NOT EXPRESSED ANY RESERVATION WITH REGARD TO THE APPLICABILITY OF SECTION 194IA OF THE ACT TO THE SUBJECT TRANSACTION. THEREFORE, THE ASSESSEE BEING A DE DUCTOR CANNOT PLEAD INAPPLICABILITY OF THE AFORESAID PROVISION. IN FACT, IN OUR VIEW, THE CONTENTION OF INAPPLICABILITY OF SECTION 194IA OF THE ACT IS REDUNDANT AND IS NOT AVAILABLE TO BE TAKEN BY THE ASSESSEE. ONCE THE ASSESSEE HAS PROCEEDED TO DEDUCT TAX AT SOURCE UNDER SECTION 194IA OF THE ACT, ALL LEGAL CONSEQUENCES ARISING IN PURSUANCE THERETO WOULD AUTOMATICALLY FOLLOW. AS PER RULE 30A THE TAX DEDUCTED AT SOURCE UNDER SECTION 194IA HAS TO BE DEPOSITED WITHIN THE TIME AND IN THE MANNER PRESCRIBED THERE IN AND IN TERMS OF RULE 31A ASSESSEE HAS TO SUBMIT THE STATEMENTS OF TDS AS PROVIDED UNDER SECTION 200(3) OF THE ACT. IN FACT, A CURSORY LOOK AT FORM NO. 26QB WOULD REVEAL THAT IT REFERS TO RULE 30A AND 31A OF THE RULES. THE ASSESSEE HAVING DEDUCTED TAX AT SOURCE NOT ONLY HAS TO DEPOSIT THE TDS AMOUNT TO THE GOVERNMENT ACCOUNT, BUT IT HAS TO FILE A STATEMENT UNDER SECTION 200(3) OF THE ACT WITHIN THE PRESCRIBED TIME LIMIT. IT IS EVIDENT, THE ASSESSEE HAS ALSO FOLLOWED THE AFORESAID PROCEDURE. THE ONLY DEFAU LT ON THE PART OF THE ASSESSEE IS, IT HAS NEITHER PAID THE TDS AMOUNT NOR FILED THE STATEMENT UNDER SECTION 200(3) READ WITH RULE 30A AND 31A WITHIN THE TIME PRESCRIBED THEREIN. THEREFORE, IN CASE OF ANY DEFAULT IN FILING THE STATEMENT IN TERMS OF SECTION 200(3) OF THE ACT, THE PROVISIONS CONTAINED UNDER SECTION 234E WOULD AUTOMATICALLY GET TRIGGERED AND FEE PRESCRIBED THEREIN HAS TO BE PAID. WHILE PROCESSING THE TDS STATEMENT UNDER SECTION 200A OF THE ACT, THE ASSESSING OFFICER IS EMPOWERED TO LEVY FEE UN DER SECTION 234E OF THE ACT, WHICH THE ASSESSING OFFICER HAS DONE IN THE PRESENT CASE. 10. THE VALIDITY OF THE PROVISION CONTAINED UNDER SECTION 234A OF THE ACT CAME UP FOR SCRUTINY BEFORE THE HON'BLE JURISDICTIONAL HIGH COURT IN CASE OF RASHMIKANT KUNDA LIA & ANR. V/S UNION OF 5 CORNERVIEW CONSTRUCTION & DEVELOPERS PVT. LTD. INDIA, [2015] 373 ITR 268 (BOM). WHILE DECIDING THE ISSUE, THE HON'BLE JURISDICTIONAL HIGH COURT NOT ONLY UPHELD THE VALIDITY OF SECTION 234E OF THE ACT, BUT ALSO OBSERVED THAT THE DELAY IN FURNISHING OF TDS RETURNS/STATEMENTS HAS A CASCADING EFFECT AND LEADS TO AN ADDITIONAL WORK BURDEN UPON THE DEPARTMENT. THE HONBLE HIGH COURT HELD, TO COMPENSATE FOR THE ADDITIONAL WORK BURDEN FORCED UPON THE DEPARTMENT, THE FEE UNDER SECTION 234E OF THE ACT IS CONTEMPLATED WHICH IS NOT PUNITIVE IN NATURE. THE FEE IS A FIXED CHARGE FOR THE EXTRA SERVICE WHICH THE DEPARTMENT HAS TO PROVIDE DUE TO THE LATE FILING OF THE TDS STATEMENT. THE COURT HELD, THE FEE CHARGED UNDER SECTION 234E OF THE ACT IS NOTHING BUT A PRIVILEGE AND A SPECIAL SERVICE TO TH E DEDUCTOR ALLOWING HIM TO FILE TDS RETURNS / STATEMENTS BEYOND THE TIME PRESCRIBED BY THE ACT AND THE RULES. THE COURT HAS HELD THAT ON PAYMENT OF THE FEE UNDER SECTION 234E OF THE ACT, THE DEDUCTOR IS ALLOWED TO FILE THE TDS RETURNS/STATEMENTS BEYOND THE PRESCRIBED TIME SO THAT IT CAN BE REGULARIZED. THUS, FROM THE AFORESAID DECISION OF THE HON'BLE JURISDICTIONAL HIGH COURT, IT IS EVIDENT THAT THE FEE UNDER SECTION 234E OF THE ACT IS NOTHING BUT A PRIVILEGE OR SPECIAL SERVICE ALLOWED TO A DEDUCTOR FOR LAT E FILING OF THE TDS STATEMENTS. IN FACT, AS COULD BE SEEN FROM THE SUBMISSIONS MADE BY THE ASSESSEE BEFORE THE LEARNED COMMISSIONER (APPEALS) AND EVEN BEFORE US, IT DOES NOT DISPUTE THE APPLICABILITY OF SECTION 234E OF THE ACT. THE ONLY ISSUE RAISED BY THE ASSESSEE IS, WHETHER IT SHOULD BE MADE APPLICABLE TO ALL TDS STATEMENTS OR TO A SINGLE TDS STATEMENT. THUS, VIEWED IN THE AFORESAID PERSPECTIVE, THE CONTENTION OF THE LEARNED AUTHORISED REPRESENTATIVE THAT THE PROVISION OF SECTION 194IA OF THE ACT IS NOT APPLICABLE DESERVES TO BE REJECTED. THE DECISION OF THE HONBLE SUPREME COURT IN CASE OF BALWANT VITTHAL KADAM V/S SUNIL BABURAO I. KADAM, (SUPRA), THEREFORE, WOULD NOT APPLY . 11. AS REGARDS THE SECOND CONTENTION OF THE LEARNED AUTHORISED REPRESENTATIVE T HAT SECTION 200(3) OF THE ACT, WOULD NOT APPLY TO A STATEMENT IN FORM NO.26QB, AS IT IS A CHALLAN CUM STATEMENT GENERATED ON THE DATE OF PAYMENT ITSELF, WE ARE UNABLE TO ACCEPT THE SAME. NO DOUBT, THE PROVISION CONTAINED UNDER SECTION 234E OF THE ACT MAKES IT CLEAR THAT IT WILL BE APPLICABLE IF THE DEDUCTOR FAILS TO DELIVER THE TDS STATEMENT WITHIN THE TIME PRESCRIBED IN SUB SECTION (3) OF SECTION 200 OF THE ACT. WHEREAS, SUB SECTION (3) OF SECTION 200 OF THE ACT MAKES IT CLEAR THAT FURNISHING OF TDS STATEM ENT IN THE PRESCRIBED FORM, MANNER AND TIME APPLIES TO ALL TDS PROVISIONS INCLUDING SECTION 194IA OF THE ACT CONTAINED UNDER CHAPTER XVII. THEREFORE, ASSESSEES CLAIM THAT SINCE THE CHALLAN CUM STATEMENT IS GENERATED ON A SINGLE DATE, THEREFORE, IT WILL NO T COME WITHIN THE PURVIEW OF SECTION 200(3) OF THE ACT, IS 6 CORNERVIEW CONSTRUCTION & DEVELOPERS PVT. LTD. UNACCEPTABLE. THUS, WE ARE OF THE VIEW THAT THE TDS STATEMENTS IN FORM NO.26QB ALSO COMES WITHIN THE AMBIT OF SECTION 200(3) OF THE ACT. 12. THE NEXT CONTENTION OF THE LEARNED AUTHORISED REPRESENTATIVE THAT NO ADDITIONAL BURDEN IS CAST ON THE DEPARTMENTAL AUTHORITIES IS ALSO EQUALLY UNACCEPTABLE CONSIDERING THE FACT THAT THERE IS A DELAY IN FILING THE TDS STATEMENT IN FORM NO. 26QB. AS HELD BY THE HON'BLE JURISDICTIONAL HIGH COURT IN CASE OF RASHMIKANT KUNDALIA & ANR. (SUPRA) FOR THE PURPOSE OF ALLOWING THE ASSESSEE TO FILE TDS STATEMENT BEYOND THE PRESCRIBED TIME AND FOR REGULARIZING THE SAME, FEE UNDER SECTION 234E OF THE ACT HAS TO BE CHARGED AS IT IS IN THE NATURE OF A PRIVILEGE AND SPECIAL SERVICE PROVIDED TO THE ASSESSEE. THEREFORE, THIS CONTENTION OF THE LEARNED AUTHORISED REPRESENTATIVE ALSO FAILS. 13. NOW, COMING TO THE PRIMARY CONTENTION OF THE LEARNED AUTHORISED REPRESENTATIVE THAT ALL THE TRANSACTIONS RELATING TO PURCHASE OF FLATS SHOULD BE TAKEN AS A SINGLE TRANSACTION FOR THE PURPOSE OF FILING THE TDS STATEMENT AND COMPUTING FEE UNDER SECTION 234E OF THE ACT, WE DO NOT FIND ANY MERIT IN SUCH CONTENTION. ON A PERUSAL OF THE ALLOTME NT LETTER DATED 29 TH OCTOBER 2015, A COPY OF WHICH IS PLACED IN PAPER BOOK AND, MORE PARTICULARLY, ANNEXURE B TO THE SAID LETTER REVEALS THAT THE DETAILS AND DESCRIPTION OF EACH OF THE FLAT ALONG WITH COST THEREOF HAS BEEN SPECIFICALLY MENTIONED. IT IS ALS O A FACT THAT THE ASSESSEE HAS COMPUTED AND DEPOSITED THE TDS AMOUNT ON THE BASIS OF THE COST OF EACH FLAT. IN THAT VIEW OF THE MATTER, THE CLAIM OF THE ASSESSEE THAT PURCHASES OF ALL THE FLATS IS TO BE TAKEN AS A SINGLE TRANSACTION, THEREFORE, THE LEVY OF FEE PRESCRIBED UNDER SECTION 234E OF THE ACT IS TO BE RESTRICTED TO ONE CHALLAN CUM STATEMENT FILED IN FORM NO.26QB, IS UNACCEPTABLE. WHEN THE ASSESSEE ITSELF HAS FILED SEPARATE TDS STATEMENTS IN RESPECT OF THE TAX DEDUCTED AT SOURCE RELATING TO THE RESPE CTIVE FLATS, WHILE PROCESSING SUCH STATEMENTS UNDER SECTION 200A OF THE ACT, THE ASSESSING OFFICER HAS TO LEVY FEE UNDER SECTION 234E OF THE ACT TAKING INTO ACCOUNT THE DELAY IN FILING EACH OF THE STATEMENTS. THAT BEING THE CASE, ASSESSEES CONTENTION THAT FEE UNDER SECTION 234E OF THE ACT IS TO BE RESTRICTED TO ONE TRANSACTION IS NOT ACCEPTABLE. AT THIS STAGE, IT WILL BE RELEVANT TO OBSERVE, CLAUSE (C) OF SUB SECTION (1) OF SECTION 200A OF THE ACT CONTEMPLATES THAT WHILE PROCESSING THE TDS RETURN, FEE UNDE R SECTION 234E OF THE ACT SHALL BE COMPUTED. THUS, USE OF WORD SHALL IN THE AFORESAID PROVISION MAKES IT MANDATORY ON THE PART OF THE ASSESSING OFFICER TO LEVY FEE UNDER SECTION 234E OF THE ACT. SINCE, THE ASSESSEE HAS FILED SEPARATE TDS STATEMENTS UNDER SECTION 200(3) OF THE ACT READ 7 CORNERVIEW CONSTRUCTION & DEVELOPERS PVT. LTD. WITH RULE 26QB, THERE IS NO ERROR ON THE PART OF THE ASSESSING OFFICER IN COMPUTING FEE UNDER SECTION 234E OF THE ACT WHILE PROCESSING SUCH STATEMENTS. 14. AS REGARDS THE CONTENTION OF THE LEARNED AUTHORISED REPRESENTATIV E THAT APPEAL AGAINST LEVY OF FEE UNDER SECTION 234E OF THE ACT IS MAINTAINABLE BEFORE THE LEARNED COMMISSIONER (APPEALS), WE FIND MERIT IN THE SAME. THEREFORE, TO THAT EXTENT, THE ASSESSEES CONTENTION IS ACCEPTED. HOWEVER, IT WILL NOT MAKE MUCH DIFFERENC E AS LEARNED COMMISSIONER (APPEALS) HAS DECIDED THE ISSUE ON MERIT. IN VIEW OF THE AFORESAID, WE DO NOT FIND ANY REASON TO INTERFERE WITH THE DECISION OF LEARNED COMMISSIONER (APPEALS) ON THE ISSUE. GROUNDS ARE DISMISSED. 6. FACTS BEING IDENTICAL, FOLLOWING THE AFORESAID DECISION OF THE TRIBUNAL, WE DISMISS THE GROUND S RAISED BY THE ASSESSEE. 7. IN THE RESULT, APPEAL STANDS DISMISSED. ORDER PRONOUNCED IN THE OPEN C OURT ON 30.12.2019 SD/ - S. RIFAUR RAHMAN ACCOUNTANT MEMBER SD/ - SAKTIJIT DEY JUDICIAL MEMBER MUMBAI, DATED: 30.12.2019 8 CORNERVIEW CONSTRUCTION & DEVELOPERS PVT. LTD. COPY OF THE ORDER FORWARDED TO : (1) THE ASSESSEE; (2) THE REVENUE; (3) THE CIT(A); (4) THE CIT, MUMBAI CITY CONCERNED; (5) THE DR, ITAT, MUMBAI; (6) GUARD FILE . TRUE COPY BY ORDER PRADEEP J. CHOWDHURY SR. PRIVATE SECRETARY ASSISTANT REGISTRAR ITAT, MUMBAI