Directorate Animal Husbandry, New Delhi V. ITO(TDS), Dehradun

ITA 489/DEL/2019

• Counselvise Citation: [2021] 108 COUNSELVISE.COM (IT) 3594 (ITAT-DEHRADUN)
• Duration Of Justice: 2 year(s) 4 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-06-2021
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB
• Assessment Year: 2012-2013
• Appeal Filed On: 23-01-2019
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Assessee Lawyers: AGAINST DATED PASSED
• Keywords: Principle of natural justice; Additional evidence; Non-deduction of tax; Condonation of delay; TDS; Set aside
• Section: 201(1); 201; 191

Judgement Text

1 ITAS. 488 TO 493 & 496/DEL/2019. IN THE INCOME TAX APPELLATE TRIBUNAL [DELHI BENCH: FRIDAY ALONG WITH DEHRADUN BENCH] BEFORE SHRI R. K. PANDA ACCOUNTANT MEMBER A N D MS SUCHITRA KAMBLE, JUDICIAL MEMBER ITAS. 488 TO 493 & 496/DEL/2019 ASSESSMENT YEARS : 2011-12 TO 2017-18. (THROUGH VIDEO CONFERENCING) DIRECTORATE ANIMAL HUSBANDRY, C/O. MRIDUL CHAKRAVARTY, ADV., A 165, LGF, DEFENCE COLONY, NEW DELHI 110 024. PAN : MRTDO2265E (APPELLANT) VS. INCOME TAX OFFICER, (TDS) DEHRADUN. (RESPONDENT) O R D E R PER SUCHITRA KAMBLE, JM : THESE APPEALS ARE FILED BY THE ASSESSEE AGAINST ORDER DATED 27/11/2018 PASSED BY THE CIT (APPEALS), DEHRADUN, FOR ASSESSMENT YEARS 2011-12 TO 2017-18. 2. THE COMMON GROUNDS OF APPEAL (EXCEPT FOR THE AMOUNTS) ARE AS UNDER:- ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE RESPONDENT [FOR BREVITY CIT(A)] HAS ERRED IN PASSING THE ORDER UNDER SECTION 250(6) OF THE INCOME TAX ACT, 1961 (FOR BREVITY THE ACT), WHEREIN IT HAS DISMISSED THE APPEAL OF THE APPELLANT IN-LIMINE, BASED ON THE FOLLOWING GROUNDS, WHICH ARE TAKEN SEPARATELY AND INDEPENDENT OF EACH OTHER, AND WITHOUT PREJUDICE TO EACH OTHER: A. FOR THAT THE APPELLANT BEFORE THIS HON'BLE- TRIBUNAL IS A GOVERNMENT ASSESSEE BY : SHRI MRIDUL CHAKRAVARTY, SHRI ASHISH BHOWMIK, & SHRI RIDHABH SEHGAL; ADVS.; DEPARTMENT BY: SHRI NAVEEN CHANDRA UPADHYAYA, SR. D.R.; DATE OF HEARING 04.06.2021 DATE OF PRONOUNCEMENT 04.06.2021 2 ITAS. 488 TO 493 & 496/DEL/2019. DEPARTMENT FOR THE STATE OF UTTARAKHAND, WHICH IS PRIMARILY DISCHARGING THE FUNCTIONOF PROVIDING PROPHYLACTIC AND THERAPEUTIC VETERINARY SERVICES, DOORSTEP ANIMAL BREEDING FACILITIES AND PRODUCTION SUPPORT ACTIVITIES TO THE LIVES STOCK FARMERS THROUGH ITS VAST INSTITUTIONAL NETWORK TO IMPROVE ANIMAL PRODUCTIVITY AND EMPLOYMENT, IS AGGRIEVED BY THE IN-LIMINE DISMISSAL OF ITS APPEAL BY THE CIT (A) , VIDE IMPUGNED ORDER DATED 27.11.2018 WHEREIN THE MERITS OF THE CASE HAVE NOT BEING CONSIDERED AND AS SUCH, THE SAME IS BAD IN LAW AND LIABLE TO BE SET ASIDE BY THIS HON'BLE TRIBUNAL. B. FOR THAT THE LD. CIT (A) AS WELL AS LD. ITO (TDS), DEHRADUN, UTTARAKHAND FAILED TO APPRECIATE IN THE FACTS AND CIRCUMSTANCES OF THE CASE THAT THERE WAS O DELIBERATE OR WILLFUL DEFAULT ON PART OF THE APPELLANT IN NON-DEDUCTION OF TDS (TAX-DEDUCTED AT SOURCE)- UNDER SECTION 194 (C) OF THE ACT FOR THE TRANSACTIONS IN QUESTION, AS IT HAS IN FACT, AFFECTED THE REQUISITE DEDUCTION AT SOURCE FOR OTHER TRANSACTIONS DURING THE SAME PERIOD, UNDER THE ABOVEMENTIONED PROVISION OF LAW. EVEN OTHERWISE, THE APPELLANT, BEFORE THE LD. CIT(A) HAD RAISED SPECIFIC OBJECTION AND DISPUTED THE DEMAND UNDER SECTION 201(1) AND ALSO THE INTEREST LEVIED UNDER SECTION 201(1A) OF THE ACT. C. FOR 'THAT IT WAS NOT THE CASE BEFORE THE LD. CIT(A) OR OF THE LD. ITO (TDS), DEHRADUN, UTTARAKHAND THAT THERE HAS BEEN ANY DELIBERATE OR MAL-INTENDED MATERIAL CONCEALMENT OF RELEVANT FACTS OR REQUISITE INFORMATION ON PART OF THE APPELLANT HEREIN. FURTHER, IT MAY BE MORE THAN RELEVANT HEREIN TO CONSIDER THAT AS SUCH, NO FORMAL TECHNICAL TRAINING OR GUIDANCE IS IMPARTED TO THE OFFICERS OF THE APPELLANT HEREIN REGARDING SENSITIZATION TO THE PROVISIONS OF THE ACT AND ITS RULES AND THEIR APPLICABILITY INCLUDING DEDUCTION OF TAX AT SOURCE AS IN THE PRESENT CASE. D. FOR THAT VIDE THE IMPUGNED ORDER DATED 27.11.2018, THE LD. CIT(A) HAS TAKEN A HYPER- TECHNICAL APPROACH IN DISMISSING THE APPEAL OF THE APPELLANT HEREIN ON THE GROUND OF DELAY ALONE WHICH HAS SEVERELY AFFECTED THE APPELLANT'S SUBSTANTIVE RIGHT. FURTHER, IT FAILED TO APPRECIATE THAT THE SAID DELAY CAUSED IN PREFERRING THE APPEAL BEFORE IT, UNDER SECTION 246(A) OF THE ACT WAS NEITHER INTENTIONAL NOR DELIBERATE BUT DUE TO THE FACTS STATED BEFORE IT AND THE SAME WERE BEYOND THE REASONABLE CONTROL OF THE APPELLANT. FURTHERMORE, THE HON'BLE SUPREME COURT HAS TIME AND AGAIN LAID DOWN THAT TOO TECHNICAL AN APPROACH SHOULD NOT BE ADOPTED WHILE CONSIDERING DELAY. E. FOR THAT, THE APPELLANT STATES THAT ASSEMBLY ELECTIONS WERE HELD IN THE MONTH OF FEBRUARY- MARCH 2017 IN THE STATE OF UTTARAKHAND AND AS SUCH, MAJORITY OF THE OFFICERS OF THE APPELLANT WERE CALLED FOR AND ENGAGED IN COMPULSORY ELECTION DUTY BY THE STATE ADMINISTRATION DURING THIS TIME. THAT, THE APPELLANT ON 03.02.2017 WAS IN RECEIPT OF THE ORDER OF THE ITO (TDS) DATED 25.01.2017 WHICH WAS COMMUNICATED TO THE EARLIER COUNSEL ENGAGED BY IT VIZ. SH. ASHISH KUMAR GUPTA FROM M/S. ASHISH KUMAR GUPTA ' AND ASSOCIATES, CHARTERED ACCOUNTANTS BASED IN DEHRADUN, UTTARAKHAND AND HE WAS REQUESTED TO PROCEED IN THE MATTER EXPEDITIOUSLY. FURTHER, THE APPELLANT WAS SHOCKED TO RECEIVE A LETTER DATED 25.03.2017 FROM THE DISTRICT TREASURY DEPARTMENT, DEHRADUN WHICH STATED THAT DDO (DRAWING AND DISBURSING OFFICER) ACCOUNT HAD BEEN FROZEN, IN VIEW OF NOTICE OF ITO (TDS) UNDER SECTION 3 ITAS. 488 TO 493 & 496/DEL/2019. 226(3) OF THE ACT, DATED 23.03.2017. THAT, THE APPELLANT- THEREAFTER IMMEDIATELY WROTE A LETTER TO THE ABOVEMENTIONED COUNSEL MR. ASHISH KUMAR GUPTA OF THE EVEN DATE I.E. 25.03.2017 ASKING HIM TO IMMEDIATELY SORT OUT THE MATTER AND PROCEED WITH THE CASE. IT IS FURTHER MOST RELEVANT TO MENTION HEREIN THAT THE APPELLANT HAS ALSO PAID AN AMOUNT TO THE TUNE OF RS. 5,96,386/- FOR DE-FREEZING THE DDO ACCOUNT IN THE INTERIM. F. FOR THAT, IN FURTHERANCE TO THE ABOVE, THE LD. CIT(A) FAILED TO APPRECIATE THAT SUBSTANTIAL DELAY ' WAS FURTHER CAUSED DUE TO AN ACT OF DELIBERATE GROSS PROFESSIONAL NEGLIGENCE ON PART OF THE EARLIER COUNSEL ENGAGED BY IT. IT IS SPECIFICALLY STATED HEREIN THAT THE SAID COUNSEL HAD OVER A SUBSTANTIAL PERIOD OF TIME, MISLED THE APPELLANT HEREIN, MAKING IT BELIEVE THAT HE HAD ALREADY PREFERRED THE REQUISITE APPEAL BEFORE THE LD. COMMISSIONER OF INCOME TAX (APPEALS) AGAINST THE ORDER OF LD. ITO (TDS), DEHRADUN, WHEN HE HAD NEVER FILED ANY SUCH APPEAL. G. FOR THAT, IN FURTHERANCE TO THE ABOVE, THE APPELLANT RECEIVED A LETTER INTIMATING AN OUTSTANDING AMOUNT AGAINST THEM ON 13.07.2017 AND THEY WERE CALLED FOR HEARING ON 20.07.2017 AND A FURTHER DATE WAS GRANTED FOR 04.08.2017. IN THE INTERIM, WHEN ORAL INQUIRIES WERE MADE UPON MR. ASHISH KUMAR GUPTA WITH REGARD TO THE STATUS OF THE APPEAL AND RECEIVING OF THE AFOREMENTIONED FRESH LETTER, HE AGAIN KEPT DILLY DALLYING THE ISSUE' AND PROMISED TO RESOLVE THE SAME. HOWEVER, THE APPELLANT FINALLY TOOK THE DECISION TO ENGAGE A FRESH COUNSEL TO DEAL WITH THE SUBJECT ISSUES AND IN THE PROCESS, AS PER RULES AND ESTABLISHED PROCEDURE, THE APPELLANT CALLED FOR FRESH QUOTATIONS FROM PROSPECTIVE COUNSEL. THAT, M/S. ELITE FINANCIAL AND TAX SOLUTIONS, DEHRADUN, UTTARAKHAND HAD ALSO PARTICIPATED BY GIVING THEIR PROFESSIONAL FEE QUOTE FOR PROCESSING THE CASE AND CONDUCTING THE APPEAL BEFORE CIT(A) AND THIS WAS ACCEPTED BY THE APPELLANT AND CONSEQUENTLY, M/S. ELITE FINANCIAL AND TAX SOLUTIONS WERE ENGAGED VIDE LETTER DATED 26.08.2017 AND CONSEQUENTLY, THE REQUISITE APPEAL WAS FILED ON 20-21.09.2017, AS SOON AS ALL THE RELEVANT RECORDS, DOCUMENTS WERE PROCURED, VERIFIED AND APPEAL(S) WERE PREPARED. H. FOR THAT, IT MAY BE NOTED THAT IN THE APPEAL MEMORANDUM PREFERRED BEFORE THE LD. CIT (A) BY THE COUNSEL ENGAGED SUBSEQUENT TO MR. ASHISH KUMAR GUPTA VIZ. MR. KAPIL RAWAT FROM M/S. ELITE FINANCIAL AND TAX SOLUTIONS, THAT, OUT OF SHEER PROESSIONAL COURTESY AND PROPRIETY, THE NAME OF THE EARLIER COUNSEL WAS NOT STATED IN WRITING WHILE EXPLAINING THE DELAY, HOWEVER. THE APPELLANT WOULD HAVE PRODUCED THE RELEVANT RECORD AND/OR INFORMATION REGARDING THE ABOVE, HAD THE LD. CIT (A) GRANTED AN OPPORTUNITY AND SOUGHT FURTHER CLARIFICATION IN THIS REGARD FROM THE APPELLANT. ALSO, PERTINENT TO NOTE IS THAT THE APPELLANT IS ALREADY SEEKING THE NECESSARY LEGAL ADVICE FOR TAKING REQUISITE RECOURSE UNDER LAW AGAINST THE EARLIER COUNSEL FOR IMPARTING SUCH DELIBERATE MIS-INFORMATION AND MISGUIDANCE. THAT, THE APPELLANT MOST RESPECTFULLY SUBMITS THAT THE FACTS AND CIRCUMSTANCES NARRATED HEREINABOVE, CONSTITUTE 'SUFFICIENT CAUSE' AS ENVISAGED UNDER THE ACT, FOR NOT PRESENTING THE REQUISITE APPEAL BEFORE CIT(A) WITHIN THE PRESCRIBED PERIOD. 4 ITAS. 488 TO 493 & 496/DEL/2019. I. FOR THAT THE HONBLE SUPREME COURT VIDE ITS JUDGEMENT REPORTED IN (2000) 10 SCC 174 HAS HELD, WHERE THERE WAS DELAY IN FILING AN APPEAL, BY REASON OF DELIBERATE NEGLIGENCE OR KEEPING IN DARK BY AN ADVOCATE, WHEREIN SUCH SERVICE PROFESSIONAL DID NOT FILE AN APPEAL AS WAS REQUIRED WITHIN TIME, IN SUCH CIRCUMSTANCES, CONDONATION OF DELAY IN PREFERRING AN APPEAL WAS JUSTIFIED. FURTHER, THE AFORE-POSITION VIZ. THAT MISTAKE OF COUNSEL MAY IN CERTAIN CIRCUMSTANCES BE TAKEN INTO ACCOUNT IN CONDONING DELAY WITH THE VAVEAT OF CHECKS, HAD ALREADY BEEN LAID DOWN BY THE HONBLE SUPREME COURT VIDE ITS EARLIER JUDGEMENT REPORTED IN (1979) 4 SCC 365. FURTHERMORE, RELIANCE IS ALSO PLACED ON THE JUDGEMENT OF THE APEX COURT, REPORTED IN (1998) 7 SCC 123. THAT, IN THE FACTS OF THE PRESENT CASE, IT IS SUBMITTED THAT THE APPELLANT HAS STATED ALSO ON OACH ABOUT THE FACT OF MISINFORMATION AND MISGUIDANCE OF THE EARLIER COUNSEL WHICH HAD CAUSED AND SUBSTANTIALLY CONTRIBUTED TO DELAY IN PREFERRING THE REQUISITE APPEAL BEFORE THE CIT (A) BUT THE SAME WAS NOT CONSIDERED. J. FOR THAT, IN FURTHERANCE TO THE ABOVE, IT IS STATED THAT SIGHT CANNOT BE LOST OF THE MANDATE OF THE HONBLE SUPREME COURT AS LAID DOWN VIDE ITS JUDGEMENT REPORTED IN (1987) 2 SCC 107. IT IS SUBMITTED THAT THE LEGISLATURE HAS CONFERRED POWER TO CONDONE DELAY, UNDER LAW, IN ORDER TO ENABLE THE COURTS TO DO SUBSTANTIAL JUSTICE TO PARTIES BY DISPOSING OF MATTERS ON MERITS. THE EXPRESSION 'SUFFICIENT CAUSE' SHOULD BE CONSTRUED IN A MANNER WHICH IS ADEQUATELY ELASTIC TO ENABLE THE COURTS TO APPLY THE APPLICABLE LAW IN A MEANINGFUL MANNER WHICH SUB-SERVES THE ENDS OF JUSTICE, THAT BEING THE LIFE- PURPOSE OF THE EXISTENCE OF THE INSTITUTION OF COURTS. A JUSTIFIABLY LIBERAL APPROACH SHOULD BE ADOPTED ON PRINCIPLE. THE DOCTRINE OF EQUALITY BEFORE LAW COMMANDS THAT ALL LITIGANTS, INCLUDING THE GOVERNMENT (STATE) AS A LITIGANT, ARE ACCORDED THE SAME TREATMENT AND THE LAW IS ADMINISTERED IN AN EVEN-HANDED MANNER. THERE IS NO WARRANT FOR ACCORDING A STEP-MOTHERLY TREATMENT WHEN THE GOVERNMENT IS THE APPLICANT PRAYING FOR CONDONATION OF DELAY. WHEN SUBSTANTIAL JUSTICE AND TECHNICAL CONSIDERATIONS ARE PITTED AGAINST EACH OTHER, THE CAUSE OF SUBSTANTIAL JUSTICE DESERVES TO BE PREFERRED, FOR THE OTHER SIDE CANNOT CLAIM TO HAVE A VESTED RIGHT IN INJUSTICE BEING DONE BECAUSE OF A NON- DELIBERATE DELAY. K. FOR THAT THE IMPUGNED ORDER PASSED BY THE CIT (A) IS AN ORDER OF DISMISSAL OF THE APPEAL IN-LIMINE, WITHOUT RECORDING ANY FINDINGS ON THE MERITS OF THE LIS, WHICH IS IN TEETH OF THE LAW LAID DOWN BY THE HON'BLE SUPREME COURT IN NUMEROUS CASES. THAT, REASONS ARE THE FLESH AND BLOOD OF JUDICIAL ADJUDICATION AND SUCH REASONS ARE A MUST TO BE SHOWN IN THE ORDERS WHICH ARE LIABLE TO BE CHALLENGED IN SUPERIOR FORA. AS SUCH, THE APPELLANT HAD A GOOD CASE ON MERITS BEFORE THE LD. CIT(A), BUT THE LD. COMMISSIONER CHOSE TO ADOPT A MORE HYPER- TECHNICAL APPROACH TO DISMISS THE SAID APPEAL IN-LIMINE, INSTEAD OF CONSIDERING THE SAME ON ITS MERITS. L. FOR THAT THE LD. CIT (A) FAILED TO APPRECIATE THE MANDATE OF THE JUDGEMENT OF THE HONBLE SUPREME COURT REPORTED IN (2007) 8 SCC 463 WHILE NOT CONSIDERING THE MOST VITAL ISSUE OF NON-DEDUCTION OF TDS BY THE APPELLANT. IN THIS REGARD, IT IS SUBMITTED THAT UTTARAKHAND PEYAJAL SANSADHAN VIKAS EVAM NIRMAN NIGAM HAD ALREADY BEEN ASSESSED ON ITS INCOME AND THE TAX DUE WAS 5 ITAS. 488 TO 493 & 496/DEL/2019. ALREADY RECOVERED FROM IT BY THE INCOME TAX DEPARTMENT, EVEN ON THE PAYMENTS THAT WERE PAID TO IT BY THE APPELLANT, THEREFORE, NO FURTHER TAX COULD HAVE BEEN RECOVERED FROM THE APPELLANT. M. THAT, IN FURTHERANCE TO THE ABOVE, IT IS SUBMITTED THAT THE LD. CIT (A) FAILED TO APPLY ITS MIND TO THE VITALITY OF FORM 26A (RULE 31ACB) FILED BY THE APPELLANT BEFORE IT, WHEREIN, IT FROM A PERUSAL OF THE SAID FORM, IT BECAME CLEAR AND BEYOND ANY DISPUTE THAT UTTARAKHAND PEYAJAL SANSADHAN VIKAS EVAM NIRMAN NIGAM HAD ALREADY PAID TAXES ON THE PAYMENTS - RECEIVED BY THE APPELLANT AND CONSEQUENTLY, RECOVERY COULD NOT HAVE BEEN MADE ONCE AGAIN FROM THE TAX DEDUCTOR WHERE THE PAYEE INCLUDED THE INCOME ON WHICH TAX WAS SAID TO HAVE NOT BEEN DEDUCTED FROM ITS TAXABLE INCOME AND PAID TAXES THEREON. N. FOR THAT, IN VIEW OF THE POSITION AS STATED UNDER GROUND H AND I, THE DEMAND FOR PAYMENT OF NON-DEDUCTED TDS AMOUNT ALONGWITH THE LEVY OF INTEREST UNDER SECTIONS 201(1) AND 201(1A) OF THE ACT ARE BAD IN LAW AND LIABLE TO BE SET ASIDE BY THIS HON'BLE TRIBUNAL. O. FOR THAT, THE IN-LIMINE DISMISSAL OF THE APPEAL PREFERRED BY THE APPELLANT BEFORE THE LD. CIT (A) ON THE SOLE GROUND OF DELAY IS ALSO BAD IN LAW AND MAY BE SET ASIDE BY THIS HON'BLE TRIBUNAL. ALTERNATIVELY, THIS HON'BLE TRIBUNAL MAY ALSO REMAND BACK THE MATTER TO THE LD. CIT(A) FOR CONSIDERING THE APPEAL AFRESH, ON MERITS IN CONSONANCE WITH VARIOUS JUDGEMENTS OF THE HONBLE SUPREME COURT. IT MAY NOT BE OUT OF PLACE TO MENTION HEREIN THAT THE APPELLANT HAD NOT BEEN GRANTED ANY FURTHER OPPORTUNITY TO PRODUCE BEFORE THE CIT(A) ANY RELEVANT INFORMATION OR DOCUMENT(S) WHICH IT MAY HAVE DESIRED AT THE TIME OF HEARING OR FURTHER REQUIRED FROM THE APPELLANT TO ADJUDICATE THE LIS, IN THE PROPER PERSPECTIVE, UNDER LAW. P. FOR THAT, IN SIMILAR CIRCUMSTANCES WHEREIN AN ISSUE AROSE WITH REGARD TO SHORT/NON-DEDUCTION OF TDS' BY THE CHIEF VETERINARY OFFICER, DEHRADUN, UTTARAKHAND ON PAYMENTS MADE TO UTTARAKH AND PEYAJAL SANSADHAN VIKAS EVAM NIRMAN NIGAM AND A CONSEQUENT DEMAND WAS RAISED ON THE BASIS OF SPOT VERIFICATION CARRIED OUT BY THE ITO (TDS) UNDER SECTION 201(1) AND LEVY OF INTEREST WAS MADE UNDER SECTION 201(1A) OF THE ACT, THE LD. COMMISSIONER (APPEALS) IN THIS CASE, RIGHTFULLY CONSIDERED AND APPLIED THE JUDGEMENT OF THE HONBLE SUPREME COURT, REPORTED IN (2007) 8 SCC 463 AND ALSO EXAMINED THE EXPLANATION TO SECTION 191 OF THE ACT, SUBSTITUTED VIDE THE FINANCE ACT, 2008 W.R.E.F. 01.06.2003 AND HELD VIDE ORDER DATED 27.06.2017 THAT SUCH DEMAND AND LEVY OF INTEREST WAS UNSUSTAINABLE UNDER LAW. Q. FOR THAT, IN FURTHERANCE TO THE AFORESAID, EXPLANATION TO SECTION 191 OF THE ACT, SUBSTITUTED VIDE THE FINANCE ACT, 2008 W.R.E.F. 01.06.2003 WHICH EXPRESSLY READS AS UNDER: ' [EXPLANATION . - FOR THE REMOVAL OF DOUBTS, IT IS HEREBY DECLARED THAT IF ANY PERSON INCLUDING THE PRINCIPAL OFFICER OF A COMPANY,- (A) WHO IS REQUIRED TO DEDUCT ANY SUM IN ACCORDACE WITH THE 6 ITAS. 488 TO 493 & 496/DEL/2019. PROVISIONS OF THIS ACT; OR (B) REFERRED TO IN SUB-SECTION 1(A) OF SECTION 192, BEING AN EMPLOYER, DOES NOT DEDUCT, OR AFTER SO DEDUCTING FAILS TO PAY, OR DOES NOT PAY, THE WHOLE OR ANY PART OF THE TAX, AS REQUIRED BY OR UNDER THIS ACT, AND WHERE THE ASSESSEE HAS ALSO FAILED TO PAY SUCH TAX DIRECTLY, THEN, SUCH PERSON SHALL, WITHOUT PREJUDICE TO AY OTHER CONSEQUENCES WHICH MAY INCUR, BE DEEMED TO BE AN ASSESSEE IN DEFAULT WITHIN THE MEANING OF SUB-SECTION (1) OF SECTION 201, IN RESPECT OF SUCH TAX.] THAT, FROM THIS ABOVE EXPLANATION, IT IS CRYSTAL CLEAR AND BEYOND ANY DISPUTE THAT THE PERSON RESPONSIBLE FOR DEDUCTION OF TAX AT SOURCE, ON AN INCOME PAID, CAN BE CONSIDERED AS IN DEFAULT, ONLY, WHERE THE PAYEE HAS NOT PAID ANY TAX ON SUCH INCOME. TO FURTHER SIMPLY IT, IF THE PAYEE HAS PAID TAX ON SUCH INCOME, THEN THE PAYER CANNOT BE CONSIDERED AS THE ASSESSEE IN DEFAULT. THE INSERTION OF THIS EXPLANATION BY THE FINANCE ACT, 2008 WHICH HAS BEEN MADE RETROSPECTIVELY APPLICABLE W.E.F. 01.06.2003 IS THE REITERATION OF THE POSITION AND LAW AS LAID DOWN BY THE HONBLE SUPREME COURT IN (2007) 8 SCC 463. R. FOR THAT, THE DEMAND RAISED VIDE ORDER DATED 25.01.2017 BY THE ITO (TDS), DEHRADUN, UTTARAKHAND ON THE APPELLANT UNDER SECTIONS 201(1) AND 201(1A) OF THE ACT, FOR AN AMOUNT OF RS.4,31,000/- [ BREAKUP = RS.2,00,000/- (ON ACCOUNT OF SHORT-DEDUCTION) + RS.2,31,000/- (ON ACCOUNT OF LEVY OF INTEREST)], WHICH DEMAND IS NOW REVIVED BY THE DISMISSAL OF THE APPEAL BY THE CIT (A) AND WHICH IS ERRONEOUS, IN VIEW OF THE VARIOUS CONTENTIONS RAISED IN THE PRESENT APPEAL, AND, AS SUCH, THE SAME IS LIABLE TO BE SET ASIDE BY THIS HONBLE TRIBUNAL ALONG WITH THE DEMAND AND LEVY OF INTEREST AS STATED ABOVE. S. FOR THAT THERE WAS NO INDEPENDENT APPLICATION OF MIND BY THE LD. CIT (A) TO THE MATERIAL PLACED BEFORE IT BY THE APPELLANT, WHICH RESULTED IN THE ERRONEOUS DISMISSAL OF THE APPEAL BELOW. T. FOR THAT THE PRESENT APPEAL IS MADE BONA-FIDE AND IN THE INTEREST OF JUSTICE. THAT, IF THE PRAYERS AS PRAYED FOR BEFORE THIS HONBLE TRIBUNAL ARE NOT ALLOWED, THE APPELLANT SHALL SUFFER IRREPARABLE AND SERIOUS INJURIES. AS SUCH, THE BALANCE OF CONVENIENCE LIES IN FAVOUR OF THE APPELLANT. 3. IN ALL THE SEVEN APPEALS FILED BY THE ASSESSEE THE FACTS ARE COMMON, THEREFORE, WE ARE TAKING UP THE FACTS OF THE APPEAL BEING ITA NO. 488/DEL/2019. THE ITO (TDS, DEHRADUN HAS CONDUCTED A SURVEY PROCEEDING AT THE DIRECOTRATE, ANIMAL HUSBANDRY, DEHRADUN ON 08.11.2016 TO VERIFY WHETHER TDS/TCS 7 ITAS. 488 TO 493 & 496/DEL/2019. PROVISIONS ARE BEING FOLLOWED WHILE MAKING PAYMENTS TO VARIOUS PARTIES. DURING THE VERIFICATION OF THE RECORDS, DOCUMENTS AND PAYMENT REGISTER, THE DCIT(TDS) HAS NOTICED DEFAULT REGARDING NON-DEDUCTION OF TAXES ON VARIOUS PAYMENTS AND ASKED THE ASSESSEE TO SUBMIT THE DETAILS OF ALL PAYMENTS MADE TO VARIOUS PARTIES DURING THE FINANCIAL YEAR 2010-11. THE ACCOUNTANT OF THE ASSESSEE APPEARED BEFORE THE ITO (TDS) ON BEHALF OF THE ASSESSEE AND SUBMITTED THE DETAILS AND DOCUMENTS. AFTER EXAMINATION OF RECORDS, DOCUMENTS AND PAYMENT REGISTER, THE ITO(TDS), DEHRADUN HAS FOUND THAT TDS IS NOT BEING DEDUCTED NOR DEPOSITED OF UTTARAKHAND PAY JAL SANSADHAN VIKAS NIGAM FOR CONSTRUCTION OF OFFICE BUILDING AND RESIDENTIAL BUILDINGS IN THE CENTRAL GOVERNMENT ACCOUNT BY THE ASSESSEE IN THE FINANCIAL YEAR 2010-11 ON VARIOUS PAYMENTS. ACCORDINGLY A SHOW CAUSE NOTICE WAS ISSUED AND AS FIXED FOR COMPLIANCE ON 21.11.2016, AFTER THE SUBMISSION OF RELATED DOCUMENTS TO THE ITO (TDS) A DEMAND ORDER WAS ISSUED TO THE ASSESSEE WITH A CALCULATION OF TDS LIABILITY AND INTEREST AMOUNT. IN RESPONSE TO THE SHOW CAUSE NOTICE, THE ASSESSEE SUBMITTED DETAILED REPLY BEFORE THE ASSESSING AUTHORITY ON 21.11.2016 ALONG WITH ALL RELEVANT DOCUMENTS. AFTER TAKING INTO CONSIDERATION THE SUBMISSIONS OF THE ASSESSEE, THE ITO (TDS), DEHRADUN PASSED THE ORDER ON 25.01.2017 U/S 201(1) AND 201(1A) BY DECLARING THE ASSESSEE AT DEFAULT AND ISSUED NOTICE OF DEMAND OF RS. 4,31,000/- INCLUDING INTEREST LIABILITY UNDER SUB-SECTION (1A) OF SECTION 201 OF THE INCOME TAX ACT, 1961. 4. BEING AGGRIEVED BY THE ORDER U/S 201(1) AND 201(1A) PASSED BY ITO (TDS), DEHRADUN, THE ASSESSEE FILED APPEAL BEFORE THE CIT(A). THE CIT(A) DISMISSED THE APPEAL IN LIMINE. 5. THE LD. AR SUBMITTED THAT THERE IS A DELAY OF 201 DAYS WHICH WAS NOT DELIBERATE ON PART OF THE ASSESSEE IN FILING THE APPEAL BEFORE THE CIT(A). THE LD. AR SUBMITTED THAT THE PREVIOUS COUNSEL ENGAGED BY THE ASSESSEE MISINFORMED THE ASSESSEE REGARDING FILING OF APPEAL EVEN THOUGH THE ASSESSEE INSTRUCTED THE SAID COUNSEL TO DO THE NEEDFUL AT THE EARLIEST. THE LD. AR FURTHER SUBMITTED 8 ITAS. 488 TO 493 & 496/DEL/2019. THAT THE COMMUNICATION LETTER DATED 25.03.2017 TO THE EARLIER COUNSEL BY THE ASSESSEE WHEREIN THE SAID COUNSEL WAS SPECIFICALLY REQUESTED TO PROCEED WITH AND FILE THE REQUISITE APPEAL UNDER THE INCOME TAX ACT, 1961 AGAINST THE ORDER DATED 25.01.2017, COULD NOT BE PRODUCED BEFORE THE CIT(A) AT THE TIME OF APPELLATE PROCEEDINGS BEFORE THE CIT(A). THE LD. AR FURTHER SUBMITTED THAT THE DELAY WAS GENUINE AND THE ASSESSEE HAS SUBMITTED FORM -26A QUA THE ACCOUNTANT CERTIFICATE BEFORE THE CIT(A), HOWEVER, THE SAME WAS NOT CONSIDERED AT ALL AND WITHOUT DECIDING ON MERIT, THE CIT(A) SIMPLY DISMISSED THE APPEAL ON THE GROUND OF DELAY. ON THE ISSUE OF DELAY, THE LD. AR RELIED UPON THE FOLLOWING DECISIONS: I. N. BALAKRISHNAN VS. M. KRISHNAMURTHY (1998) 7 SCC 123 II. COLLECTOR, LAND ACQUISITION ANANTNAG AND ANR. VS. MIST. KATIJI & ORS. (1987) 2 SCC 107 III. DEEPAK PARSHAD VS. AUTOMOBILE PRODUCTS OF INDIA AND ORS. (2000) 10 SCC 174 IV. M/S CONCORD OF INDIA INSURANCE CO. LTD. VS. SMT. NIRMALA DEVI & ORS. (1979) 4 SCC 365 V. INDIAN OIL CORPORATION LTD. & ORS. VS. SUBRATA BORAH CHOWLEK & ORS. (2010) 14 SCC 419 VI. LALIT RANJIT SACHDEV VS. JAYESH JAYANTILAL MISTRY & ORS. (2010) 14 SCC 419 VII. SURESH HARIBHAU ADMANE VS. PURUSHOTTAM SHANKARRAO PUROHIT CIVIL REVISION APPLICATION NO. 500 OF 1979 VIII. SHYAM LAL SURESH KUMAR VS. STATE OF HARYANA & ORS. (2007) 14 SCC 301 IX. MAHESH BUILDERS VS. SACHEETA CO-OPERATIVE HOUSING SOCIETY LTD. (2010) 14 SCC 784 ON THE ISSUE OF MISGUIDANCE AND NO PROPER LEGAL ADVICE AND ASSISTANCE, THE LD. AR RELIED UPON THE DECISION OF THE HONBLE DELHI HIGH COURT IN CASE OF DEVENDER KAUR VS. PUNJAB AND SIND BANK & ORS. (2018) SCC ONLINE DELHI 10441 ON MERIT, THE LD. AR SUBMITTED THAT THE ASSESSEE-DEDUCTEE VIS. 9 ITAS. 488 TO 493 & 496/DEL/2019. UTTARAKHAND PEYJAL SANSADHAN VIKAS EVAM NIRMAN NIGAM WAS ASSESSED ON ITS ENTIRE INCOME, WHICH INCLUDED THE AMOUNT OF MONEY RECEIVED BY THE SAID ASSESSEE-DEDUCTEE FROM THE PRESENT ASSESSEE, CATEGORIZED UNDER THE HEAD CENTAGE CHARGES IN ITS COMPUTATION OF INCOME, SHOWN IN THE RECEIPT AND PAYMENT ANNEXURE PART OF THE BALANCE SHEET, FOR THE ASSESSEE-DEDCUTEE, FOR THE AYS. 2011-12 TO 2017-18. THE LD. AR RELIED UPON THE DECISION OF THE HONBLE SUPREME COURT IN CASE OF HINDUSTAN COCA COLA BEVERAGE PVT. LTD. VS. CIT (2007) 8 SCC 463 AND ALSO RELIED UPON THE DECISION OF THE TRIBUNAL IN CASE OF THOMAS MUTHOOT VS. DCIT (2012) SCC ONLINE ITAT 13216. THE LD. AR FURTHER STATED THAT THE ASSESSEE HAS FILED APPLICATION FOR PRODUCTION OF ADDITIONAL EVIDENCES BEFORE THE TRIBUNAL AND THE SAME MAY BE CONSIDERED. 6. THE LD. DR SUBMITTED THAT THE CIT(A) RIGHTLY DISMISSED THE APPEAL IN LIMINE AS THE ASSESSEE HAS NOT GIVEN A PROPER REASON AS TO WHY THE DELAY OF 201 DAYS OCCURRED IN FILING THE APPEALS. ON MERITS, THE LD. DR RELIED UPON THE ORDER OF THE ITO(TDS), DEHRADUN PASSED U/S 201(1) AND 201(1A) OF THE ACT. AS REGARDS TO APPLICATION FOR ADDITIONAL EVIDENCES, THE LD. DR OPPOSED THE SAME SUBMITTING THEREIN THAT THE SAID DOCUMENTS SHOULD HAVE BEEN PRESENTED BEFORE THE ITO (TDS), DEHRADUN. 7. WE HAVE HEARD BOTH THE PARTIES AND PERUSED ALL THE RELEVANT MATERIAL AVAILABLE ON RECORD. IT IS PERTINENT TO NOTE THAT THE APPEALS WERE FILED BELATEDLY BEFORE THE CIT(A) AND THE REASON GIVEN BY THE LD. AR APPEARS TO BE GENUINE AS THE EARLIER COUNSEL HAS NOT CO-OPERATED WITH THE ASSESSEE FOR FILING THE APPEAL ON TIME BEFORE THE CIT(A). THE ASSESSEE, IN OUR OPINION CANNOT BE DENIED THE PRINCIPLES OF NATURAL JUSTICE FOR CONTESTING THE ISSUES ON MERIT BEFORE THE CIT(A). THE HONBLE SUPREME COURT IN CASE OF COLLECTOR, LAND ACQUISITION ANANTNAG & ANR. VS. MIST. KATIJI & ORS. (SUPRA) HAD LAID DOWN THE FOLLOWING PRINCIPLE WHILE CONSIDERING THE CONDONATION OF DELAY: 10 ITAS. 488 TO 493 & 496/DEL/2019. 3. THE LEGISLATURE HAS CONFERRED THE POWER TO CONDONE DELAY BY ENACTING SECTION 51 OF THE INDIAN LIMITATION ACT OF 1963 IN ORDER TO ENABLE THE COURTS TO DO SUBSTANTIAL JUSTICE TO PARTIES BY DISPOSING OF MATTERS ON MERITS. THE EXPRESSION SUFFICIENT CAUSE EMPLOYED BY THE LEGISLATURE IS ADEQUATELY ELASTIC TO ENABLE THE COURTS TO APPLY THE LAW IN A MEANINGFUL MANNER WHICH SUBSERVES THE ENDS OF JUSTICE THAT BEING THE LIFE-PURPOSE FOR THE EXISTENCE OF THE INSTITUTION OF COURTS. IT IS COMMON KNOWLEDGE THAT THIS COURT HAS BEEN MAKING A JUSTIFIABLY LIBERAL APPROACH IN MATTERS INSTITUTED IN THIS COURT. BUT THE MESSAGE DOES NOT APPEAR TO HAVE PERCOLATED DOWN TO ALL THE OTHER COURTS IN THE HIERARCHY. AND SUCH A LIBERAL APPROACH IS ADOPTED ON PRINCIPLE AS IT IS REALIZED THAT: 1. ORDINARILY A LITIGANT DOES NOT STAND TO BENEFIT BY LODGING AN APPEAL LATE. 2. REFUSING TO CONDONE DELAY CAN RESULT IN A MERITORIOUS MATTER BEING THROWN OUT AT THE VERY THRESHOLD AND CAUSE OF JUSTICE BEING DEFEATED. AS AGAINST THIS WHEN DELAY IS CONDONED THE HIGHEST THAT CAN HAPPEN IS THAT A CAUSE WOULD BE DECIDED ON MERITS AFTER HEARING THE PARTIES. 3. EVERY DAYS DELAY MUST BE EXPLAINED DOES NOT MEAN THAT A PEDANTIC APPROACH SHOULD BE MADE. WHY NOT EVERY HOURS DELAY, EVERY SECONDS DELAY ? THE DOCTRINE MUST BE APPLIED IN A RATIONAL COMMON SENSE PRAGMATIC MANNER. 4. WHEN SUBSTANTIAL JUSTICE AND TECHNICAL CONSIDERATIONS ARE PITTED AGAINST EACH OTHER, CAUSE OF SUBSTANTIAL JUSTICE DESERVES TO BE PREFERRED FOR THE OTHER SIDE CANNOT CLAIM TO HAVE VESTED RIGHT IN INJUSTICE BEING DONE BECAUSE OF A ON-DELIBERATE DELAY. 5. THERE IS NO PRESUMPTION THAT DELAY IS OCCASIONED DELIBERATELY, OR ON ACCOUNT OF CULPABLE NEGLIGENCE, OR ON ACCOUNT OF MALA FIDES. A LITIGANT DOES NOT STAND TO BENEFIT BY RESORTING TO DELAY. IN FACT HE RUNS A SERIOUS RISK. 11 ITAS. 488 TO 493 & 496/DEL/2019. 6. IT MUST BE GRASPED THAT JUDICIARY IS RESPECTED NOT ON ACCOUNT OF ITS POWER TO LEGALIZE INJUSTICE ON TECHNICAL GROUNDS BUT BECAUSE IT IS CAPABLE OF REMOVING INJUSTICE AND IS EXPECTED TO DO SO. .THE ORDER OF THE HIGH COURT DISMISSING THE APPEAL BEFORE IT AS TIME-BARRED, IS THEREFORE, SET ASIDE. DELAY IS CONDONED. AND THE MATTER IS REMITTED TO THE HIGH COURT. THE HIGH COURT WILL NOT DISPOSE OF THE APPEAL ON MERITS AFTER AFFORDING REASONABLE OPPORTUNITY OF HEARING TO BOTH THE SIDES. BY FOLLOWING THE ABOVE DECISION, VARIOUS COURTS HAVE TAKEN A LIBERAL APPROACH FOR CONDONATION OF DELAY. HENCE, IN LIGHT OF VARIOUS DECISIONS OF THE HONBLE APEX COURT RELIED BY THE LD. AR AT THE TIME OF HEARING AND THE GENUINE REASON EXPLAINED BY THE LD. AR, WE CONDONE THE DELAY OF 201 DAYS IN FILING THE APPEALS BY THE ASSESSEE BEFORE THE CIT(A). WE SET ASIDE THE ORDER OF THE CIT(A) AND REMAND BACK THE ENTIRE ISSUES CONTESTED BY THE ASSESSEE TO THE FILE OF THE CIT(A) TO BE DECIDED ON MERIT. THE ASSESSEE MAY FILE THE ADDITIONAL EVIDENCE BEFORE THE CIT(A) BY FILING PROPER APPLICATION AS PER THE PROCEDURE PRESCRIBED UNDER THE INCOME TAX RULES, 1962 AND THE CIT(A) SHALL CONSIDER THE SAME AS PER LAW. NEEDLESS TO SAY THE ASSESSEE BE GIVEN OPPORTUNITY OF HEARING BY FOLLOWING PRINCIPLES OF NATURAL JUSTICE. AS ALL THE APPEALS ARE IDENTICAL FOR A.YS. 2011-12 TO 2016-17, THE SAME DIRECTION AS GIVEN HEREINABOVE WE BE FOLLOWED IN ALL THE APPEALS. THUS, ALL SEVEN APPEALS ARE PARTLY ALLOWED FOR STATISTICAL PURPOSE. 8. IN RESULT, ALL APPEALS FILED BY THE ASSESSEE ARE PARTLY ALLOWED FOR STATISTICAL PURPOSE. ORDER PRONOUNCED IN THE OPEN COURT IN PRESENCE OF BOTH THE PARTIES ON THIS 04 TH DAY OF JUNE, 2021. SD/- SD/- ( R. K. PANDA ) (SUCHITRA KAMBLE) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 04/06/2021 *MEHTA* 12 ITAS. 488 TO 493 & 496/DEL/2019. COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT (APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI DATE OF DICTATION 04.06.2021 DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 04.06.2021 DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE OTHER MEMBER 04.06.2021 DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR. PS/PS 04.06.2021 DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE DICTATING MEMBER FOR PRONOUNCEMENT 04.06.2021 DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR. PS/PS 04.06.2021 DATE ON WHICH THE FINAL ORDER IS UPLOADED ON THE WEBSITE OF ITAT 04.06.2021 DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 04.06.2021 DATE ON WHICH THE FILE GOES TO THE HEAD CLERK THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT REGISTRAR FOR SIGNATURE ON THE ORDER DATE OF DISPATCH OF THE ORDER