ACIT, New Delhi V. M/s. Yam Restaurants (India) (P) Ltd., New Delhi

ITA 4058/DEL/2011

• Counselvise Citation: 405820114 RSA 2011
• Duration Of Justice: 2 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-11-2011
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: I
• Assessment Year: misc
• Appeal Filed On: 06-09-2011
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: A K MONGA
• Assessee Lawyers: NAGESHWAR RAOMS PREETI GOEL
• Keywords: Opportunity of being heard; Additional evidence
• Section: 133A; 201(1)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES: I NEW DELHI BEFORE SMT. DIVA SINGH, JUDICIAL MEMBER AND SHRI K.D.RANJAN , ACCOUNTANT MEMBER ITA NO: 4058/DEL/2011 A.Y. : 2005-06 ACIT, CIRCLE 51(1) VS. M/S YAM RESTAURANTS (INDIA) P.LTD. NEW DELHI 84 F, C 6 LANE, SAINIK FARMS NEW DELHI 110 062 TAN/PAN NO: DEL Y 00521D (APPELLANT) (RESPONDENT) APPELLANT BY : SH. A.K.MONGA, SR.D.R. RESPONDENT BY : SH.NAGESHWAR RAO/MS.PREETI GOEL, ADV. O R D E R PER DIVA SINGH, JUDICIAL MEMBER THIS IS AN APPEAL FILED BY THE REVENUE AGAINST THE ORDER DT. 6.6.2011 OF CIT(A)-XXX, NEW DELHI PERTAINING TO A.Y . 2004-05 ON THE FOLLOWING GROUNDS. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AS WELL AS IN LAW, THE LD.CIT(A) HAS ERRED IN 1(A). IN ACCEPTING THE ADDITIONAL EVIDENCE PRODUCE D BY THE APPELLANT WITHOUT GIVING OPPORTUNITY TO THE AO BEFO RE ADJUDICATING THE APPEAL. (B) IN REDUCING THE DEMAND PAYABLE U/S 201 OF THE I .T.ACT AND SUBSEQUENTLY ALSO DIRECTING THE A.O. TO RECALCU LATE THE INTEREST U/S 201(1A) OF THE ACT SIMPLY BASED ON THE ADDITIONAL EVIDENCE WHICH WAS NOT EVEN IN ACCORDANC E WITH CBDT CIRCULAR NO. 8/2009 DT. 24.11.2009. 2. THE APPELLANT CRAVES LEAVE FOR RESERVING THE RI GHT TO AMEND, MODIFY, ALTER, ADD OR FOREGO ANY GROUND(S) O F APPEAL AT ANY TIME BEFORE OR DURING THE HEARING OF THIS AP PEAL. ITA NO. 4058/DEL/2011 PAGE 2 OF 5 A.Y. 2004-05 M/S YAM RESTAURANTS (INDIA) PVT.LTD., N.DELHI 2. THE LD.SR.D.R. MR.AK MONGA INVITED OUR ATTENTION TO PAGE 6 OF THE IMPUGNED ORDER SUBMITTED THAT THE ASSESSEE HAS TAKE N THE STAND BEFORE THE CIT(A) THAT THE PAYEE HAD PAID THE TAX ON THE T AXABLE INCOME BY WAY OF TDS/ADVANCE TAX AND THE COPIES OF THE CERTIFICA TES OBTAINED WERE FILED BEFORE THE CIT(A) WHICH WERE NEVER MADE AVAILABLE T O THE A.O. ACCORDINGLY FRESH EVIDENCES HAVE BEEN FILED BEFORE THE CIT(A) IN CONTRAVENTION TO THE REQUIREMENTS OF THE ACT ALONG WITH THE RULES. INVITING ATTENTION TO ORDER U/S 201(1)/201(1A) PAS SED BY THE A.O. IT WAS SUBMITTED THAT NO SUCH DETAILS WERE MADE AVAILABL E BEFORE HIM, AS SUCH IT WAS REQUESTED THAT THE ISSUE MAY BE RESTORED BAC K TO THE FILE OF A.O. FOR VERIFICATION. 3. LD.A.R. ON THE OTHER HAND CONTENDED THAT THE ASS ESSEE BEFORE THE CIT(A) RELIED UPON THE JUDGEMENT OF THE APEX COURT IN M/S HINDUSTAN COCA COLA BEVERAGES P.LTD. VS CIT AMONGST OTHERS AN D THE EVIDENCES RELIED UPON WERE COGENT AND RELEVANT AND COULD BE M ADE AVAILABLE ONLY BEFORE THE CIT(A). IN THE CERTIFICATES IT WAS STAT ED THAT BOTH KOTAK MAHINDRA PRIMUS LTD. AND BSR & CO. HAVE CONFIRMED T HAT THEY HAVE INCLUDED THE AMOUNT RECEIVABLE FROM THE ASSESSEE IN THEIR TAXABLE INCOME AND ALSO PAID TAX ON THE SAME BY WAY OF TDS/ ADVANCE TAX AS SUCH IT IS NOT NECESSARY TO RESTORE. 4. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. IT IS SEEN THAT THE ASSESSEE COMPANY IS ENGAGED IN THE BUSINESS OF RUNNING RESTAURANTS ON FRANCHISEE B ASIS AS PER THE ITA NO. 4058/DEL/2011 PAGE 3 OF 5 A.Y. 2004-05 M/S YAM RESTAURANTS (INDIA) PVT.LTD., N.DELHI MATERIAL AVAILABLE ON RECORD AND A SURVEY U/S 133A WAS CARRIED OUT IN THIS CASE AT THE BUSINESS PREMISES OF THE ASSESSEE COMPANY ON 18.11.2004 AT GURGAON. AFTER ISSUANCE OF POST SUR VEY LETTER AND RECEIVING THE DETAILS IN RESPONSE THERETO IT WAS CU LLED OUT BY THE ITO THAT THE ASSESSEE HAD FAILED TO DEPOSIT TAX U/S 194A IN RESPECT OF TDS ON FINANCE CHARGES ON LEASED ASSETS AMOUNTING TO RS. 2,82,442/- AND PROFESSIONAL CHARGES AMOUNTING TO RS.8,419/-. IT W AS ALSO OBSERVED THAT THE ASSESSEE HAD DEPOSITED THE TDS LATE UNDER TH E HEAD SALARY. THE DELAY IN DEPOSITING IN THE GOVERNMENT TREASURY IT W AS HELD ATTRACTS INTEREST U/S 201(1A) AND THE CALCULATION AS PER TH E CHART SET OUT IN THE ASSESSMENT ORDER SHOWED THAT THE TOTAL LIABILITY U /S 201(1)/201(1A) CAME TO RS. 2,90,861/- AND RS. 1,47,885/- WHICH TOT ALLED TO RS. 4,38,746/- RESPECTIVELY. 5. AGGRIEVED BY THIS ORDER THE ASSESSEE CHALLENGED THE ORDER BEFORE THE CIT(A) ON THE GROUNDS OF OPPORTUNITY AS WELL AS ON MERITS. 6. THE CIT(A) TOOK INTO CONSIDERATION THE EVIDENCES RELIED UPON BY THE ASSESSEE BEFORE HIM WHICH ADMITTEDLY WERE NOT MADE AVAILABLE TO THE A.O. A PERUSAL OF THE SAID ORDER FURTHER SHOWS THA T THE CIT(A) AT PAGES 6 AND 7 OF THE IMPUGNED ORDER CAME TO THE FOLLOWING C ONCLUSION. I HAVE CONSIDERED THE FACTS OF THE CASES MATERI ALS SUPPLIED BY APPELLANT AND ASSESSMENT ORDER U/S 201(1)/201(1A ) OF A.O. (TDS). A TABLE CONTAINING FRESH CALCULATION OF TA X LIABILITY U/S 201(1)/201(1A) IS GIVEN BY APPELLANT WHICH IS ANNEX ED TO THIS ORDER. IN MY OPINION, THIS SHOWS THE CONNECT SHORT FALL OF TAX DEDUCTION U/S 201(1) AND INTEREST CALCULATION U/S 201(1A) UPTO 31.3 ON WHICH DEDUCTEE/PAYEE HAVE PAID ADVANCE TAX/ TDS IN THE RETURNS FILED FOR F.Y. 2004-05 RELATED TO A.Y. 2005-06. ITA NO. 4058/DEL/2011 PAGE 4 OF 5 A.Y. 2004-05 M/S YAM RESTAURANTS (INDIA) PVT.LTD., N.DELHI THUS TDS U/S 201(1) RS. 3,782/- & TDS U/S 201 (1A) RS. 13,953/- THE A.O. (TDS) MAY VERIFY THESE FIGURES FROM APPELL ANT, AND MODIFY THE ORDER ACCORDINGLY. (EMPHASIS PROVIDED BY THE BENCH.) 7. SIMILARLY CONSIDERING THE PRAYER THAT IN THE IMP UGNED ORDER THE A.O. HAD CHARGED INTEREST U/S 201(1A) FOR DELAY IN TDS TILL THE DATE OF PASSING OF ASSESSMENT ORDER IN MARCH, 2009 THE CIT( A) TAKING NOTE OF THE FOLLOWING SUBMISSIONS CONCLUDED AS UNDER. IN THE AFORESAID INSTRUCTION, THE CBDT HAS STATED THAT INTEREST U/S 201(1A) OF THE ACT SHOULD BE CHARGED O NLY TILL THE DATE OF PAYMENTS OF TAXES BY THE PAYEE. SIMIL AR VIEWS HAS ALSO BEEN UPHELD BY THE HONBLE SUPREME COURT I N HINDUSTAN COCA COLA BEVERAGES P.LTD. VS CIT (SUPRA) AND HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF CI T VS. M/S ADIDAS INDIA MARKETING P.LTD. (SUPRA). SINCE BOTH THE PAYEES HAS PAID TAXES ON THEIR TAXAB LE INCOME BY WAY OF TDS/ADVANCE TAX, THE APPELLANT IS LIABLE TO PAY INTEREST U/S 201(1A) TILL 31 ST MARCH, 2005. ACCORDINGLY, WE HAVE COMPUTED INTEREST U/S 201(1A) UP TO 31 ST MARCH, 2005. PLEASE REFER CHART ENCLOSED AS ANNE XURE 2. AS PER THE SAID CHART, THE INTEREST U/S 201(1A) WILL BE RS. 13,953/-. IN VIEW OF THE ABOVE LEGAL POSITION, WE HEREBY REQU EST YOUR HONOUR TO RESTRICT THE LEVY OF INTEREST U/S 201(1A) TILL THE DATE OF PAYMENT OF TAXES BY THE PAYEE, WHICH IS RS. 13, 953/- AND NOT TILL THE DATE OF PASSING OF ASSESSMENT ORDE R. THE A.O. (TDS) MAY VERIFY THESE FIGURES FROM AP PELLANT, AND MODIFY THE ORDER ACCORDINGLY. (EMPHASIS PROVIDED BY THE BENCH.) 8. THUS CONSIDERING THE SUBMISSIONS ADVANCED WE ARE OF THE VIEW THAT AS PER SETTLED LEGAL PROCEDURES THE FRESH EVI DENCE NO DOUBT RELEVANT AND COGENT SHOULD HAVE BEEN CONFRONTED TO THE A.O. IT IS SEEN THAT THE NECESSITY OF VERIFICATION OF FACTS WAS EXPERIENCED BY THE CIT(A) HIMSELF. IN THE AFORE MENTIONED PECULIAR FACTS AND CIRCUMSTA NCES WE SET ASIDE THE ITA NO. 4058/DEL/2011 PAGE 5 OF 5 A.Y. 2004-05 M/S YAM RESTAURANTS (INDIA) PVT.LTD., N.DELHI IMPUGNED ORDER NOT ONLY ON THE GROUND THAT FRESH EV IDENCES HAVE BEEN ENTERTAINED IN REGARD TO WHICH REMAND REPORT WAS NOT OBTAINED BUT ALSO ON THE GROUND THAT THE PROCEDURE ADOPTED NAMEL Y DIRECTING THE A.O. TO VERIFY THE FIGURES IN CONTRARY TO THE PROVISION S OF THE ACT AS THE CIT(A) U/S 251(1) NO LONGER ENJOYS THE POWER OF SETTING AS IDE AND HAS TO DECIDE THE GROUNDS AS PER LAW. 9. ACCORDINGLY FOR THE REASONS GIVEN HEREINABOVE TH E ISSUE IS RESTORED TO THE FILE OF THE A.O. WITH THE DIRECTION TO DECID E THE SAME IN ACCORDANCE WITH LAW BY WAY OF A SPEAKING ORDER AFTER GIVING TH E ASSESSEE A REASONABLE OPPORTUNITY OF BEING HEARD. 10. IN THE RESULT THE APPEAL OF THE REVENUE IS AL LOWED FOR STATISTICAL PURPOSES. PRONOUNCED IN THE OPEN COURT ON 9 TH NOVEMBER, 2011. SD/- SD/- (K.D.RANJAN) (DIVA SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 9 TH NOVEMBER, 2011 *MANGA COPY OF THE ORDER FORWARDED TO: 1. APPELLANT; 2.RESPONDENT; 3.CIT; 4.CI T(A); 5.DR; 6.GUARD FILE BY ORDER DY. REGISTRAR // C O P Y //