ACIT, Delhi V. Air India Ltd., New Delhi

ITA 3736/DEL/2015

• Counselvise Citation: [2018] 119 COUNSELVISE.COM (IT) 4015 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 4 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-11-2018
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: G
• Assessment Year: misc
• Appeal Filed On: 08-06-2015
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: K TEWARI SENIOR
• Section: 206AA

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH G : NEW DELHI) BEFORE SHRI KULDIP SINGH, JUDICIAL MEMBER AND SHRI PRASHANT MAHARISHI, ACCOUNTANT MEMBER ITA NO.3735/DEL./2015 (ASSESSMENT YEAR : 2013-14) ITA NO.3736/DEL./2015 (ASSESSMENT YEAR : 2013-14) ACIT, CIRCLE 73 (1), VS. AIR INDIA LIMITED, NEW DELHI. 113, AIRLINES HOUSE, GURUDWARA RAKAB GANJ ROAD, NEW DELHI. (PAN : AACCN6194P) (APPELLANT) (RESPONDENT) ASSESSEE BY : NONE REVENUE BY : SHRI K. TEWARI, SENIOR DR DATE OF HEARING : 25.09.2018 DATE OF ORDER : 02.11.2018 O R D E R PER KULDIP SINGH, JUDICIAL MEMBER : THE APPELLANT, ACIT, CIRCLE 73 (1), NEW DELHI (HERE INAFTER REFERRED TO AS THE ASSESSEE) BY FILING THE PRESE NT APPEAL, SOUGHT TO SET ASIDE THE IMPUGNED ORDERS DATED 27.02.2015 & 26.02. 2015 PASSED BY LD. CIT (APPEALS)-18, NEW DELHI QUA SECOND QUARTER FOR FY 2013-14 & FOURTH QUARTER FOR FY 2012-13 RESPECTIVELY ON THE I DENTICAL GROUNDS, EXCEPT THE DIFFERENCE IN AMOUNT, INTER ALIA THAT:- ITA NO.3735 & 3736/DEL./2015 2 1. WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASES, THE LD. CIT(A) HAS ERRED IN DIRECTING THE AO TO VERIFY DEMAND/PAYMENT AND PASS FRESH ORDER WITHOUT CONSIDE RING THE PROVISION OF SUB SECTION (A) OF SECTION 251(1). 2. WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) HAS ERRED IN DIRECTING THE AO TO DELETE THE DEMAND ( RS.72,49,843/- & RS.21,05,618/- FOR SECOND QUARTER FOR FY 2013-14 & FOURTH QUARTER FOR FY 2012 -13 RESPECTIVELY) CREATED ON ACCOUNT OF WRONG/INVALID P AN WITHOUT CONSIDERING THE PROVISIONS OF SECTION 206AA WHICH IS MANDATORY IN NATURE. 2. BRIEFLY STATED THE FACTS NECESSARY FOR ADJUDICA TION OF THE CONTROVERSY AT HAND ARE : AIR INDIA LIMITED, EARLIE R KNOWN AS INDIAN AIRLINES LIMITED, A 100% GOVERNMENT OWNED COMPANY, ENGAGED IN TRANSPORTATION OF GOODS, PASSENGERS AND PARCELS ETC . IN DOMESTIC AND INTERNATIONAL SECTOR BY AIR THROUGH AN AIRCRAFT AND AS SUCH IS A NATIONAL CARRIER. ASSESSEE FILED TDS RETURN FOR SECOND QUAR TER FOR FY 2013-14 ON 30.08.2013 AND TDS RETURN FOR FOURTH QUARTER FOR FY 2012-13 ON 02.07.2013. FOR AY 2013-14 SECOND QUARTER, AN INTI MATION WAS SENT RAISING A DEMAND OF RS.84,62,260/- AND FOR FY 2012- 13 FOURTH QUARTER FOR RS.60,85,320/- ON ACCOUNT OF SHORT DEDUCTION OF TDS. FOR FY 2013-14 SECOND QUARTER, A DEMAND OF RS.72,49,843.84 WAS RAISED U/S 200A ON ACCOUNT OF SHORT DEDUCTION AND FOR FY 2012- 13 FOURTH QUARTER, AS PER INTIMATION U/S 54, DEMAND OF RS.21,05,618.10 WAS RAISED. IT IS THE CASE OF THE ASSESSEE THAT SHORT DEDUCTION FOR FY 20 13-14 SECOND QUARTER IS DUE TO NON-MENTIONING OF THE PAN NUMBER IN CASE OF M/S. ENGINE LEASE FINANCE B.V. IN FILING THE RETURN AND DUE TO MENTIONING OF ITA NO.3735 & 3736/DEL./2015 3 INCORRECT PAN NUMBERS OF SOME OF THE EMPLOYEES DUE TO CLERICAL ERROR IN CASE OF TDS RETURN FOR FOURTH QUARTER (FY 2012-13). 3. ASSESSEE CARRIED THE MATTER BY WAY OF APPEAL BEF ORE THE LD. CIT (A) WHO HAS DELETED THE DEMAND AFTER ALLOWING THE A PPEAL. FEELING AGGRIEVED, THE REVENUE HAS COME UP BEFORE THE TRIBU NAL BY WAY OF FILING THE PRESENT APPEAL. 4. ASSESSEE HAS NOT PREFERRED TO PUT IN APPEARANCE DESPITE ISSUANCE OF THE NOTICE AND CONSEQUENTLY, WE PROCEEDED TO DEC IDE THE PRESENT APPEAL WITH THE ASSISTANCE OF THE LD. SENIOR DR AS WELL AS ON THE BASIS OF DOCUMENTS AVAILABLE ON THE FILE. 5. WE HAVE HEARD THE LD. DEPARTMENTAL REPRESENTATIV E FOR THE REVENUE TO THE APPEAL, GONE THROUGH THE DOCUMENTS R ELIED UPON AND ORDERS PASSED BY THE REVENUE AUTHORITIES BELOW IN T HE LIGHT OF THE FACTS AND CIRCUMSTANCES OF THE CASE. 6. UNDISPUTEDLY, AIR INDIA LTD. HAS MADE PAYMENT TO THE FOREIGN ENTITY. IT IS ALSO NOT IN DISPUTE THAT THE DEMAND HAS BEEN RAISED ON ACCOUNT OF SHORT DEDUCTION ON ACCOUNT OF MENTIONING OF THE WRONG PAN NUMBER. IN CASE OF SHORT DEDUCTION OF DEMAND FOR SECOND QUA RTER (FY 2013-14), THE SAME IS CLAIMED TO BE ON ACCOUNT OF NON-MENTIONING OF THE PAN NUMBER OF M/S. ENGINE LEASE FINANCE B.V. AT THE TIME OF FI LING THE RETURN. THE REVENUE HAS TREATED THE TDS DEDUCTION BY TREATING T HE PARTY HAVING A PAN NUMBER AND THUS APPLYING THE HIGHER TDS @ 20% WHERE AS AS PER DOUBLE TAXATION AVOIDANCE AGREEMENT (DTAA) BETWEEN INDIA A ND NETHERLAND, ITA NO.3735 & 3736/DEL./2015 4 THE RATE OF TAX IS 10% ALONG WITH INTEREST. ASSESS EE HAS ALSO PAID INTEREST FOR LATE PAYMENT. ASSESSEE HAS ALSO MADE PAYMENT O N ACCOUNT OF LATE FILING OF RETURN FEE. SO FAR AS DEMAND OF RS.10,82 ,594/- ON ACCOUNT OF SHORT DEDUCTION OF RS.72,49,843.84 IS CONCERNED, TH E SAME IS NOT SUSTAINABLE AS IT IS NOT THE CASE OF SHORT DEDUCTIO N BUT IT IS THE CASE OF WRONGLY APPLYING THE TDS RATE BY LOSING SIGHT OF DT AA BETWEEN INDIA AND NETHERLAND. INSOFAR AS DEMAND FOR FOURTH QUART ER (FY 2012-13) DEDUCTION FOR RS.2,10,200/- IS CONCERNED, THE REVEN UE HAS TREATED THIS TRANSACTION WITH INCORRECT PAN NUMBERS AND HAS APPL IED TDS @ 20%. IT IS ALSO NOT IN DISPUTE THAT WHEN THE CORRECT PAN NU MBERS OF THE CONCERNED EMPLOYEES IS MENTIONED IN THE REVISED TDS RETURN, T HE DEMAND WOULD COME TO NIL. HOWEVER, THE ASSESSEE HAS AGREED TO D EPOSIT INTEREST DEMAND AS WELL AS LATE FILING FEE ON ACCOUNT OF LATE DEPOS IT OF TAX. 7. WHEN WE EXAMINE ALL THE AFORESAID FACTS IN THE L IGHT OF UNDISPUTED FACT THAT FINAL ASSESSMENT IS STILL PENDING WITH TH E DEPARTMENT, THE APPEAL FILED BY THE ASSESSEE BEFORE LD. CIT (A) WAS NOT MA INTAINABLE AS THE ASSESSEE HAS CATEGORICALLY MADE SUBMISSION THAT INT EREST DEMAND ON ACCOUNT OF LATE DEPOSIT OF TAX AND LATE FILING OF R ETURN, DEMAND IS BEING DEPOSITED BY THE ASSESSEE, THERE WAS NO QUESTION OF DELETING THE DEMAND RAISED AS ALL THESE FACTS WERE TO BE EXAMINED BY TH E AO DURING ASSESSMENT ON THE BASIS OF SUBMISSIONS MADE BY THE ASSESSEE. 8. MOREOVER, SECTION 200A OF THE ACT IS A SELF-CONT AINED PROCEDURE TO PROCESS THE STATEMENT OF TAX DEDUCTION AT SOURCE AF TER MAKING ADJUSTMENT ITA NO.3735 & 3736/DEL./2015 5 OF ANY ARITHMETIC ERROR OR INCORRECT CLAIM. FURTHE RMORE, THE ASSESSEE HAS MADE AN UNDERTAKING BEFORE THE COMMISSIONER THAT IT IS REVISING THE RETURN FOR INCORPORATING THE PAN NUMBERS OF THOSE EMPLOYEE S WHICH WILL OTHERWISE LEAD TO THE DEMAND NIL AND IN CASE OF DEM AND FOR SECOND QUARTER FOR FY 2013-14, NO INTEREST SHALL BE CHARGED AS THE DEMAND ITSELF WOULD NOT BE SUSTAINABLE. 9. IN VIEW OF WHAT HAS BEEN DISCUSSED ABOVE, WE ARE OF THE CONSIDERED VIEW THAT THE LD. CIT (A) HAS ERRED IN DELETING THE DEMAND PARTICULARLY WHEN ASSESSMENT PROCEEDINGS QUA THE YEAR UNDER ASSE SSMENT ARE ALREADY PENDING WITH THE DEPARTMENT, HENCE PRESENT APPEALS FILED BY THE REVENUE ARE ALLOWED. ORDER PRONOUNCED IN OPEN COURT ON THIS 2 ND DAY OF NOVEMBER, 2018. SD/- SD/- (PRASHANT MAHARISHI) (KULDIP SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED THE 2 ND DAY OF NOVEMBER, 2018 TS COPY FORWARDED TO: 1.APPELLANT 2.RESPONDENT 3.CIT 4.CIT(A)-18, NEW DELHI. 5.CIT(ITAT), NEW DELHI. AR, ITAT NEW DELHI.