AJMER VIDHYUT VITRAN NIGAM LTD., Ajmer V. DCIT, Jaipur

ITA 494/JPR/2016

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 2144 (ITAT-JAIPUR)
• Duration Of Justice: 1 year(s) 2 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-08-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2010-2011
• Appeal Filed On: 06-05-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R A VERMA CIT LQUOKB; VERINDER MEHTA
• Keywords: Reasonable cause; Condonation of delay
• Section: 234B; 6; 10; 154; 15

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHE S, JAIPUR JH DQY HKKJR] U;KF;D LNL; ,OA JH FOE FLAG ;KNO] YS [KK LNL; DS LE{K BEFORE: SHRI KUL BHARAT, JM & SHRI VIKRAM SINGH YAD AV, AM VK;DJ VIHY LA-@ ITA NO. 494/JP/16 FU/KZKJ.K O'K Z@ ASSESSMENT YEAR : 2010-11 AJMER VIDYUT VITRAN NIGAM LTD., AO (CPC) PANSCHEEL AJMER. CUKE VS. THE DCIT(TDS), CPC, GHAZIABAD. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN NO.: AACCA8562E VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRHDH VKSJ LS@ ASSESSEE BY : SHRI SUNIL PORWAL JKTLO DH VKSJ LS@ REVENUE BY : SHRI VERINDER MEHTA AND SHRI R.A .VERMA (ADDL.CIT ) LQUOKBZ DH RKJH[K@ DATE OF HEARING : 01/08/2017 ?KKS'K .KK DH RKJH[K @ DATE OF PRONOUNCEMENT: 03/08/2017. VKNS'K@ ORDER PER SHRI VIKRAM SINGH YADAV, A.M. THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF LD. CIT(A), AJMER DATED 29.02.2016 FOR A.Y. 2010-11 WHEREIN THE ASSESSEE HAS TAKEN FOLLOWING GROUNDS OF APPEAL ARE AS UNDER:- 1. THAT THE LEARNED CIT(APPEALS) AJMER ERRED IN DIS MISSING OUR APPEAL BY MAINTAINING THE INTEREST U/S 201(1A) OF THE I.T. ACT 1961 WITHOUT APPRECIATING FULL FACTS AND CIRCUMSTANCES OF THE CA SE. 2. THAT THE LEARNED CIT(APPEALS) AJMER ERRED ON THE FACTS THAT THE ASSESSEE HAS DEPOSIT THE TDS ON 08/08/2009 NEXT WOR KING DAY. THE DUE DATE WAS 07/08/2009, THE DELAY WAS DUE TO STRIK E OF THE BANK ON 06/08/2009 AND 07/08/2009. AS PER THE SECTION 10 OF GENERAL CLAUSE ACT, 1897 THE NEXT WORKING DAY SHOULD BE TREATED AS DUE DATE. THE ITA NO. 494/JP/16 AJMER VIDYUT VITRAN NIGAM VS. DCIT(TDS)CPC 2 BOARD ALSO HAS ISSUED CIRCULAR NO 676 DT 14/01/1994 AND 639 DATED 13/11/1992 WHICH IS BINDING ON DEPARTMENT. 3. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) HAS ERRED, BOTH ON FACTS AND IN LAW, IN DIRECTING THE AO TO VERIFY THE RATE OF INTEREST CHARGEABLE U/S 201(1A) OF IT ACT 1961 INST EAD OF DEALING WITH THE MATTER ITSELF. 2. BRIEFLY THE FACTS OF THE CASE ARE THAT AN INTIMATIO N U/S 154 OF THE IT ACT WAS RECEIVED BY THE ASSESSEE FROM DCIT-CPC TDS IN R ESPECT OF TDS RETURN (FORM 26Q) FILED FOR THE 2 ND QUARTER OF F.Y. 2009-10, DETERMINING INTEREST LIABILITY OF RS. 1,33,614/- ON ACCOUNT OF LATE PAYM ENT OF TDS. ON PURSING THE INTIMATION & THE DEFAULT STATEMENT, IT WAS FURTHER OBSERVED THAT TDS OF RS. 66,92,054/- WAS DEPOSITED BY THE ASSESSEE ON 08.08. 2009 IN PLACE OF DUE DATE WHICH WAS 07.08.2009 AND INTEREST LIABILITY HA S BEEN DETERMINED ON LATE PAYMENT OF TDS U/S 201(1A) @ 1.5%. BEING AGGRIEVED, THE ASSESSEE CARRIED THE MATTER IN APPEAL WHO HAS CONFIRMED THE INTEREST DEMAND. 3. THE RELEVANT FINDINGS OF THE LD. CIT(A) WHICH ARE U NDER CHALLENGE BEFORE US ARE REPRODUCED AS UNDER:- 4.0 I HAVE GONE THROUGH THE STATEMENT OF FACTS FIL ED BY THE APPELLANT CAREFULLY. THE APPELLANT HAS CONTENDED THAT HE COUL D NOT DEPOSIT THE FACT ON 07.08.2009 (WHICH WAS THE DUE DATE), AS THE RE WAS A STRIKE OF THE BANK ON 07.08.2009, THEREFORE, THE DELAY IN DEP OSITING THE TDS MAY BE CONDONED. IN SUPPORT OF HIS ARGUMENT, THE APPELL ANT HAS RELIED ON THE CIRCULAR NO. 639 DATED 13.11.1992. I HAVE GONE THROUGH CIRCULAR CAREFULLY. THIS CIRCULAR HAS BEEN ISSUED IN RESPECT OF FILING OF RETURN OF INCOME AND IT DOES NOT COVER THE PAYMENT OF TAX. UN DER THE ACT, THERE IS NO PROVISION TO CONDONE THE DELAY IN DEPOSITING THE TDS. THE CHARGING OF INTEREST U/S 201(1)(A) IS MANDATORY. TH EREFORE, THE CONTENTION OF THE APPELLANT THAT THE DELAY IN DEPOS IT OF TDS MAY BE CONDONED IS NOT ACCEPTABLE. ITA NO. 494/JP/16 AJMER VIDYUT VITRAN NIGAM VS. DCIT(TDS)CPC 3 AS FAR AS THE OTHER ARGUMENT OF THE APPELLANT THAT THE PERIOD OF DELAY IS ONE MONTH ONLY AND NOT TWO MONTH AND RATE OF INTERE ST APPLICABLE FOR THE A.Y. 2010-11 WAS 1% WHEREAS THE INTEREST HAS BE EN CHARGED BY THE DCIT CPC @ 1.5% ARE CONCERNED, THE ASSESSEE HAS NOT FURNISHED ANY EVIDENCE TO SUBSTANTIATE THE FACTS NARRATED BY HIM. THEREFORE, THE AO IS DIRECTED TO VERIFY THE CONTENTION OF THE APPELLANT REGARDING THE PERIOD OF DELAY AND RATE OF INTEREST FROM THE RECORD AND RECT IFY THE MISTAKE, IF ANY, AFTER VERIFICATION OF THE RECORD. 4. DURING THE COURSE OF HEARING, THE LD. AR SUBMITT ED THAT THE DEMAND HAS BEEN RAISED ON ACCOUNT OF INTEREST ON DEPOSIT OF TD S FOR RS. 66,92,054/- ON 08.08.2009 AS AGAINST DUE DATE OF 07.08.2009. THERE WAS BANK STRIKE ON 06.08.2009 AND 07.08.2009 AND DUE TO BANK STRIKE, N O TRANSACTIONS EITHER OF DEPOSIT OR WITHDRAWALS COULD HAVE BEEN MADE. THE CI T(APPEALS) HAS NOT ALLOWED THE APPEAL BECAUSE OF MANDATORY PROVISION F OR CHARGING INTEREST U/S 201(1)(A) AND NO PROVISIONS FOR CONDONE THE DELAY I N PAYMENT EVEN DUE TO REASONABLE CAUSE OF BANK STRIKE AND HENCE NOT ACCEP TED OUR REQUEST TO DELETE OUR DAY LATE DEPOSIT INTEREST RS. 1,33,614/-. 5. IN SUPPORT, RELIANCE WAS PLACED ON DECISION REPO RTED IN 157ITD 415 IN THE CASE OF DAMODAR VALLEY CORPORATION V/S ACIT WHEREIN IT WAS HELD AS UNDER: VSDL TEK DJOKUS DH VFURE FRFFK DKS JFOOKJ GKUS IKJ VXYS DK;Z FNOL DKS TEK DJOK;K X;K VSDL DH IGYH FDR TEK DJOKUS DH NS; FRFF K 15-06-2008 FKHA BL FNU JFOOKJ FKK] ,SLS ESA DEIUH }KJK 16-06-2008 DKS ,MOKAL VSDL DH IGYH FDR TEK DJOKBZ XBZA TC BL FJVUZ DK QSLYK BUDE VSDL FOHKKX } KJK FD;K X;K RKS ,MOKAL VSDL NSJH LS TEK DJOKUS CKCR /KKJK 234 LH DS RGR RH U EKG DK C;KT YXK FN;K X;KA DEIUH DK DGUK FKK FD MLDS }KJK ,MOKAL VSDL DH FDR HKJUS ESA NSJH UGHA DH XBZ- CFYD 15-06-2008 DKS JFOOKJ GKSUS DS DKJ.K C SAD CAN FKSA ,SLS ESA DEIUH 15-06- 2008 DKS ,MOKAL VSDL DH FDR TEK UGHA DJOK IK;SA ITA NO. 494/JP/16 AJMER VIDYUT VITRAN NIGAM VS. DCIT(TDS)CPC 4 ;G EKEYK EKUUH; FVZ~C;WUY RD IGQAPKA EKUUH; FVZ~C;W UY DS LE{K ;G RDZ FN;K X;K FD GENERAL CLAUSES ACT DH /KKJK 10 ;G DGRH GS FD FDLH DK;Z DKS DJUS DH VF URE FRFFK DKS ;FN JKTDH; VODKK GS RKS MLDS CKN TKS VXY K DK;Z FNOL GKSXK ,OA MLS DK;Z DKS DJUS DH VFURE FRFFK EKUH TK,XHA EKUUH; FVZ~C;WUY US BL RDZ DKS LOHDKJ DJRS GQ, DEIU H DS I{K ESA FU.KZ; NSRS GQ, FY[KK FD IF THE LAST DAY FOR PAYMENT OF ANY INSTALLMENTS O F ADVANCE TAX IS A DAY ON WHICH THE RECEIVING BANK IS CLOSED, THE ASSE SSEE CAN MAKE PAYMENT ON THE NEXT IMMEDIATELY FOLLOWING WORKING DAY, AND IN SUCH CASES, THE MANDATORY INTEREST LEVIABLE UNDER 234B AND 234C OF THE INCOME TAX ACT, 1961 WOULD NOT BE CHARGED. FOLLOWING THE AFORESAID CIRCULAR NO. 67 6, DATED 14.01.1994 AND SECTION 10 OF GENERAL CLAUSES ACT, IT WAS CONCLUDED THAT ASSESSEE HAS NOT COMMITTED ANY DEFAULT IN PAYMENT OF FIRST INSTALLME NT OF ADVANCE TAX. IT WAS SUBMITTED THAT IN OUR CASE, THE BANK WAS CLO SED DUE TO STRIKE ON 06.08.2009 AND 07.08.2009 BOTH DAYS WAS ALSO EQUAL TO HOLIDAY BECAUSE OF NO WORKING DUE TO NOT ATTENDING THE STAFF DUE TO ST RIKE AND WE HAVE DEPOSITED THE SUMS ON NEXT WORKING DAY I.E. 08.08.2009 AS ADM ITTED BY BOTH THE LOWER AUTHORITIES AND HENCE THE DEPOSIT DATE SHOULD BE CO NSIDERED AS DEPOSITED IN TIME LIMIT AND NO INTEREST SHOULD HAVE BEEN CHARGED BY CONSIDERING DELAY IN DEPOSIT. THE CASE IS FULLY COVERED BY OUR CASE. THAT THERE IS ALSO A CASE DECIDED BY ALLAHABAD HIGH COURT IN (2014) 304 ELT 652 (ALL.) IN THE CASE OF QURTZONE SHOE COMPONENT ( INDIA) PVT.) LTD. V/S UNION OF INDIA-HELD- VKF[KJH RKJH[K NQV~VH GKSUS IJ VXYK DK;Z FNOL EKUK TK;SXK 6. IN SUPPORT, RELIANCE WAS ALSO PLACED ON CBDT C IRCULAR NO. 676 DATED 14.01.1994 WHEREIN IT HAS CLARIFIED AS UNDER:- THAT IF THE LAST DAY FOR PAYMENT OF ANY INSTALLMEN T OF ADVANCE TAX IS A DAY ON WHICH THE RECEIVING BANK IS CLOSED THE ASSESSEE CAN MAKE THE PAYMENT AS THE NEXT IMMEDIATELY FOLLOWING WORKING DAY, AND IN SUCH CASES, THE MANDATORY ITA NO. 494/JP/16 AJMER VIDYUT VITRAN NIGAM VS. DCIT(TDS)CPC 5 INTEREST LEVIABLE U/S 234B AND 234C INCOME TAX ACT, 1961 WOULD NOT BE CHARGED. AS THE ABOVE CIRCULAR IS BENEFICIAL IN THE PUBLIC I NTEREST THE SAME SHOULD BE FOLLOWED BY ALL COURTS AS DECIDED BY SUPREME COURT IN THE CASE OF M/S SUCHITRA COMPONENTS LTD. V/S COMMISSIONER OF CENTRA L EXCISE (2009) 20 VST 726(SC) (2008) 13 VST 151(SC). EVEN WITHOUT PREJUDICE TO ABOVE THE BENEFICIAL CBDT CIRCULAR &/OR INSTRUMENTS ARE ALWAYS BINDING ON ALL SUBORDINATES &/OR OFFICES OF INCOME TAX DEPTT. IN VIEW OF ANY CIRCULAR AS WELL AS SEC. 10 OF GENER AL CLAUSES ACT, THERE IS NO ANY DEFAULT COMMITTED BY US IN PAYMENT OF TDS IN TI ME. THE DELAY OF ONE DAY IS ONLY ON ACCOUNT OF BANK HOLIDAY AS ADMITTED IN B ANK CERTIFICATE PRODUCED BEFORE APPELLATE AUTHORITY AND THERE IS NO DELAY ON OUR PART. IN SUCH CASES MANDATORY INTEREST LEVIABLE WOULD NOT BE CHARGED AS PER THIS CIRCULAR ALSO. 7. THE LD. DR VEHEMENTLY ARGUED THE MATTER AND SUPP ORTED THE ORDER OF THE LOWER AUTHORITIES. HE SUBMITTED THAT THERE IS N O PROVISION FOR CONDONATION OF DELAY AND INTEREST U/S 201(IA) IS MANDATORY IN N ATURE 8. CLAUSE 10 OF THE GENERAL CLAUSES ACT READS AS UNDER:- (1) WHERE, BY ANY (CENTRAL ACT) OR REGULATION MADE AFTER THE COMMENCEMENT OF THIS ACT, ANY ACT OR PROCEEDING IS DIRECTED TO A LLOWED TO BE DONE OR TAKEN IN ANY COURT OR OFFICE ON A CERTAIN DAY OR WITHIN A PR ESCRIBED PERIOD, THEN, IF THE COURT OR OFFICE IS CLOSED ON THAT DAY OR THAT DAY O R THE LAST DAY OF THE PRESCRIBED PERIOD, THE ACT OR PROCEEDING SHALL BE C ONSIDERED AS DONE OR TAKEN IN DUE TIME IF IT IS DONE OR TAKEN ON THE NEXT DAY AFTERWARDS ON WHICH THE COURT OR OFFICE IS OPEN. PROVIDED THAT NOTHING IS THIS SECTION SHALL APPLY T O ANY ACT OR PROCEEDING TO WHICH THE (INDIAN LIMITATION ACT, 1877(15 OF 1877), APPLIES. ITA NO. 494/JP/16 AJMER VIDYUT VITRAN NIGAM VS. DCIT(TDS)CPC 6 THIS SECTION APPLIES ALSO TO ALL (CENTRAL ACTS) AND REGULATIONS MADE ON OR AFTER THE FOURTEENTH DAY OF JANUARY 1887. 9. CBDT CIRCULAR NO. 676 DATED 14.01.1994 READS AS UNDER:- 1. REPRESENTATIONS HAVE BEEN RECEIVED BY THE BOARD SEEKING WAIVER OF INTEREST CHARGEABLE UNDER SECTIONS 234B AND 234C OF THE INCOME-TAX ACT, 1961 FOR DEFAULT IN PAYMENT OF INSTALMENTS OF ADVAN CE TAX BY THE DUE DATES WHICH ARE PRESCRIBED UNDER SECTION 211 OF THE INCOM E-TAX ACT. IN CASES WHERE THE LAST DATE FOR MAKING PAYMENT OF SUCH INSTALMENT S ( I.E. 15 TH SEPTEMBER, 15 TH DECEMBER AND 15 TH MARCH) HAPPENS TO BE A HOLIDAY AND THE ASSESSEE PAYS THE DUE AMOUNT OF ADVANCE TAX ON THE NEXT WORK ING DAY. 2. THE MATTER HAS BEEN CAREFULLY CONSIDERED BY THE BOARD AND IT IS FELT THAT IN SUCH CASES SECTION 10 OF THE GENERAL CLAUSES ACT, 1 897 WILL BE APPLICABLE. THIS SECTION LAYS DOWN THAT WHERE ANY ACT OR PROCEEDING IS DIRECTED OR ALLOWED TO BE DONE OR TAKEN IN ANY COURT OR OFFICE ON A CERTAI N DAY OR WITHIN A PRESCRIBED PERIOD, THEN, IF THE COURT OR OFFICE (IN THE PRESEN T CASE THE BANK WHICH IS AUTHORISED TO RECEIVE PAYMENT OF ADVANCE TAX FROM THE ASSESSEE) IS CLOSED ON THAT DAY OR ON THE LAST DAY OF THE PRESCRIBED PERIO D, THE ACT OR PROCEEDING SHALL BE CONSIDERED AS DONE OR TAKEN IN DUE TIME AF TER IT IS DONE OR TAKEN ON THE NEXT DAY, AFTERWARDS, ON WHICH THE COURT OR OFF ICE ( OR THE BANK) IS OPEN. IN VIEW OF THIS PROVISION, IT IS HEREBY CLARIFIED T HAT IF THE LAST DAY FOR PAYMENT OF ANY INSTALMENTS OF ADVANCE TAX IS A DAY ON WHICH THE RECEIVING BANK IS CLOSED, THE ASSESSEE CAN MAKE THE PAYMENT ON THE NE XT IMMEDIATELY FOLLOWING WORKING DAY, AND IN SUCH CASES, THE MANDATORY INTER EST LEVIABLE UNDER SECTIONS 234B AND 234C OF THE INCOME-TAX ACT, 1961 WOULD NOT BE CHARGED. 10. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. IT IS NOT IN DISPUTE THAT THE TAXES DEDU CTED HAVE BEEN DEPOSITED WITH A DELAY OF ONE DAY. IT IS ALSO NOT IN DISPUTE THAT ON THE DUE DATE OF DEPOSIT I.E, 7.8.2009, THERE WAS BANK STRIKE AND AN EFFECTIVE BANK HOLIDAY AND ITA NO. 494/JP/16 AJMER VIDYUT VITRAN NIGAM VS. DCIT(TDS)CPC 7 NO TAXES COULD HAVE BEEN DEPOSITED ON THE SAID DATE . THE CBDT HAS RECEIVED SIMILAR REPRESENTATION IN CONTEXT OF DEPOSIT OF ADV ANCE TAX WHEN THE LAST DATE OF DEPOSIT OF INSTALLMENT OF ADVANCE TAX HAPPENS TO BE A HOLIDAY AND TAKING INTO CONSIDERATION THE PROVISIONS OF SECTION 10 OF THE GENERAL CLAUSES ACT, HAS CLARIFIED VIDE ITS CIRCULAR NO. 676 DATED 14.1.1994 THAT IF THE LAST DAY FOR PAYMENT OF ANY INSTALLMENT OF ADVANCE TAX IS A DAY ON WHICH THE RECEIVING BANK IS CLOSED, THE ASSESSEE CAN MAKE THE PAYMENT O N THE NEXT IMMEDIATELY FOLLOWING WORKING DAY, AND IN SUCH CASES, THE MANDA TORY INTEREST LEVIABLE U/S 234B AND 234C INCOME TAX ACT, 1961 WOULD NOT BE CHA RGED. IN THE INSTANT CASE, THE BANK WAS CLOSED ON 7.8.2009 ON ACCOUNT OF BANK STRIKE AND THE TAXES HAVE BEEN DEPOSITED ON 8.8.2009. IN OUR VIEW , CIRCULAR NO. 676 DATED 14.1.1994 DRAWS SUPPORT FROM SECTION 10 OF THE GENE RAL CLAUSES ACT AND IS EQUALLY APPLICABLE TO DEPOSIT OF TDS WHERE ON THE D UE DATE OF DEPOSIT, THE BANK IS CLOSED AND THE TAXES ARE DEPOSITED ON THE N EXT WORKING DAY. WE ARE COGNISANCE OF THE FACT THAT THE PERIOD UNDER CONSID ERATION RELATES TO PERIOD WHERE INTERNET BANKING AND E-DEPOSIT OF TAXES WERE NOT IN VOGUE. IN LIGHT OF ABOVE, THERE IS NO DEFAULT ON THE PART OF THE ASSES SEE AND INTEREST U/S 201(1)(A) IS NOT LEVIABLE IN THE INSTANT CASE. THE GROUNDS ARE THUS ALLOWED. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWE D. ORDER PRONOUNCED IN THE OPEN COURT ON 03/08/2017. SD/- SD/- DQY HKKJR FOE FLAG ;KNO (KUL BHARAT) (VIKRAM SINGH YADAV) U;KF;D LNL;@ JUDICIAL MEMBER YS[KK LNL;@ ACCOUNTANT MEMBER JAIPUR DATED:- 03/08/2017 SANTOSH VKNS'K DH IZFRFYFI VXZSF'KR@ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ@ THE APPELLANT - AJMER VIDYUT VITRAN NIGAM LTD., AO (CPC) PANSCHEEL AJMER. ITA NO. 494/JP/16 AJMER VIDYUT VITRAN NIGAM VS. DCIT(TDS)CPC 8 2. IZR;FKHZ@ THE RESPONDENT- DCIT(TDS), CPC, GHAZIABAD. 3. VK;DJ VK;QDR@ CIT 4. VK;DJ VK;QDRVIHY@ THE CIT(A) 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ@ DR, ITAT, 6. XKMZ QKBZY@ GUARD FILE (ITA NO.494/JP/2016) VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASSISTANT. REGISTRAR.