DCIT, Circle, Patiala V. M/s Hindustan Wire Products Ltd., Patiala

ITA 460/CHANDI/2018

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 4308 (ITAT-CHANDIGARH)
• Duration Of Justice: 10 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-02-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC
• Next Hearing Date: 30-07-2018
• Assessment Year: 2013-2014
• Appeal Filed On: 13-04-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Retrospective amendment
• Section: 40(a)(ia); 201(1)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL CHANDIGARH BENCHES, SMC, CHANDIGARH BEFORE SHRI N.K. SAINI, VICE PRESIDENT ITA NO.460/CHD/2018 ASSESSMENT YEAR: 2013-14 DCIT VS. M/S HINDUSTAN WIRE PRODUCTS LTD. CIRCLE, PATIALA FACTORY AREA, PATIALA PAN NO. AAACH3632C (APPELLANT) (RESPONDENT) ASSESSEE BY : SH. TEJ MOHAN SINGH, ADVOCATE REVENUE BY : SMT. CHANDRAKANTA, SR. DR DATE OF HEARING : 18/02/2019 DATE OF PRONOUNCEMENT : 18/02/2019 ORDER THIS IS AN APPEAL BY THE DEPARTMENT AGAINST THE ORD ER DT. 24/01/2018 OF LD. CIT(A)-3, LUDHIANA, THE ONLY EFFECTIVE GROUND RAISE D IN THIS APPEAL READS AS UNDER: WHETHER IN THE FACTS AND CIRCUMSTANCES OF THE CAS E, THE LD. CIT(A)-3, LUDHIANA IS LEGALLY CORRECT IN DELETING THE ADDITION OF RS. 72,19,091/- MADE U/S 40(A)(IA)(R.W.S 201(1) AND RULE 31ACB WITHOUT ISSUING CERTIFICATE I N FORM 26A AND SUBMITTING TO THE APPROPRIATE AUTHORITY) ON ACCOUNT OF EXPENDITUR E PAID AS REIMBURSEMENT WITHOUT DEDUCTING THE TAX AT SOURCE AS PER PROVISIO N OF SECTION 194A OF THE INCOME TAX ACT, 1961. 2. FROM THE AFORESAID GROUND IT IS GATHERED THAT TH E GRIEVANCE OF THE ASSESSEE RELATES TO THE DELETION OF ADDITION MADE B Y THE ASSESSING OFFICER UNDER SECTION 40(A)(IA) READ WITH SECTION 201(1) OF THE I NCOME TAX ACT, 1961 (HEREINAFTER REFERRED TO AS ACT), ON ACCOUNT OF E XPENDITURE PAID AS REIMBURSEMENT WITHOUT DEDUCTING TAX AT SOURCE UNDER SECTION 194 OF THE ACT. 3. DURING THE COURSE OF HEARING LD. COUNSEL FOR THE ASSESSEE AT THE VERY OUTSET STATED THAT AN IDENTICAL ISSUE HAVING SIMILA R FACTS HAS BEEN ADJUDICATED BY THE ITAT CHANDIGARH BENCH A IN ASSESSEES OWN CASE IN ITA NO. 1609/CHD/2017 FOR THE A.Y. 2012-13 VIDE ORDER DT. 0 4/12/2018 (COPY OF THE SAID ORDER WAS FURNISHED WHICH IS PLACED ON RECORD). 4. IN HER RIVAL SUBMISSIONS LD. SR. DR STRONGLY SUP PORTED THE ORDER OF THE ASSESSING OFFICER BUT COULD NOT CONTROVERT THE AFOR ESAID CONTENTION OF THE LD. COUNSEL OF THE ASSESSEE. 5. AFTER CONSIDERING THE SUBMISSIONS OF BOTH THE PA RTIES AND THE MATERIAL AVAILABLE ON RECORD, IT IS NOTICED THAT AN IDENTICA L ISSUE HAVING SIMILAR FACTS WAS A SUBJECT MATTER OF THE DEPARTMENTAL APPEAL FOR THE A.Y. 2012-13 IN ITA NO. 2 1609/CHD/2017 WHEREIN VIDE ORDER DT. 04/12/2018 THE ISSUE HAS BEEN DECIDED BY THE ITAT, BENCH A CHANDIGARH IN FAVOUR OF THE ASSESSEE AND AGAINST THE DEPARTMENT THE RELEVANT FINDINGS HAVE BEEN GIVEN IN PARA 4 TO 6 WHICH READ AS UNDER: 4. THE ASSESSEE BEFORE THE LD. CIT(A) RELIED UPON T HE DECISION OF THE HON'BLE DELHI HIGH COURT IN THE CASE OF CIT VS. ANSAL LAND MARK TOWNSHIP PRIVATE LIMITED [2015] 377 ITR 635 (DELHI), WHEREIN, DELHI HIGH COU RT HAS HELD THAT THE SECOND PROVISO INSERTED BY FINANCE ACT 2012 IS DECLARATORY AND CURATIVE IN NATURE AND HAS RETROSPECTIVE EFFECT W.E.F. 1.4.2005. THE LD. C IT(A) CONSIDERING THE SUBMISSIONS OF THE ASSESSEE AND THE RELEVANT CASE LAWS HELD THA T SINCE IN THIS CASE THE PAYEES HAD TAKEN INTO ACCOUNT THE SUMS RECEIVED FROM THE A SSESSEE AND HAD FILED THEIR RETURN AND PAID DUE TAXES, HENCE, IN THE LIGHT OF T HE SECOND PROVISO TO SECTION 40(A)(IA) OF THE ACT, NO DISALLOWANCE U/S 40(A)(IA) OF THE ACT WAS WARRANTED. 5. BEING AGGRIEVED BY THE ABOVE ORDER OF THE CIT(A) , THE REVENUE HAS COME IN APPEAL BEFORE US. 6. AT THE OUTSET, LD. COUNSEL FOR THE ASSESSEE HAS PLACED ON FILE A COPY OF ANOTHER DECISION / ORDER OF THE HON'BLE PUNJAB & HARYANA HI GH COURT IN THE CASE OF PCIT- 2, CHANDIGARH VS. M/S MOBISOFT TELESOLUTIONS PRIVAT E LIMITED IN ITA NO. 495 OF 2017 (O&M) ORDER DATED 3.10.2018, WHEREIN, THE FINDINGS SO ARRIVED AT BY THE HON'BLE DELHI HIGH COURT IN THE CASE OF CIT VS. ANSAL LAND MARK TOWNSHIP PRIVATE LIMITED, (SUPRA) HAS BEEN REAFFIRMED BY THE JURISDICTIONAL H IGH COURT . NO DISTINGUISHING CASE LAW HAS BEEN PUT BEFORE US BY THE DEPARTMENT. SO RESPECTFULLY FOLLOWING THE AFORESAID REFERRED TO ORDER IN ASSESSEES OWN CASE FOR THE PRECEDING ASSESSMENT YEAR IN ITA NO. 1 609/CHD/2017, I DO NOT FIND ANY MERIT IN THIS APPEAL OF THE DEPARTMENT. 6. IN THE RESULT, APPEAL OF THE DEPARTMENT IS DISMI SSED. (ORDER PRONOUNCED IN THE OPEN COURT ON 18/02/2019. ) SD/- (N.K. SAINI) VICE PRESIDENT PLACE: CHANDIGARH DATED : 18/02/2019 AG COPY TO: THE APPELLANT, THE RESPONDENT, THE CIT, TH E CIT(A), THE DR