M/s. Interglobe Aviation Ltd., Gurgaon V. ACIT (TDS), New Delhi

ITA 4942/DEL/2016

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 7549 (ITAT-DELHI)
• Duration Of Justice: 4 year(s) 11 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-08-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Assessment Year: misc
• Appeal Filed On: 15-09-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ANIMA BARNWAL
• Assessee Lawyers: NAGE S KR BEHL
• Keywords: Bonafide belief; TDS; Set aside
• Section: 200A; 64

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH C : NEW DELHI) (THROUGH VIDEO CONFERENCE ) BEFORE SHRI ANIL CHATURVEDI, ACCOUNTANT MEMBER AND SHRI KULDIP SINGH, JUDICIAL MEMBER ITA NO.4942/DEL./2016 ASSESSMENT YEAR : 2014-15 M/S. INTEGLOBE AVIATION LTD. VS. INCOME TAX OFFICER, TOWER D, 4 TH FLOOR, CPC - CIRCLE-74(1), GLOBAL BUSINESS PARK, DLF, LAXMI NAGAR PHASE 3, MG ROAD NEW DELHI GURGAON (PAN : AABC12726B) (APPELLIANT) (RESPONDEN T) ASSESSEE BY : SH. NAGE S KR. BEHL, ADV. REVENUE BY : MS. ANIMA BARNWAL, SR. DR DATE OF HEARING : 16.08.2021 DATE OF ORDER : 26.08.2021 O R D E R PER KULDIP SINGH, JUDICIAL MEMBER : APPELLANT, M/S. INTEGLOBE AVIATION LTD., (HEREINAF TER REFERRED TO AS THE ASSESSEE) BY FILING THE PRESE NT APPEAL SOUGHT TO SET ASIDE THE IMPUGNED ORDER DATED 30.06.2016 PASS ED BY THE COMMISSIONER OF INCOME-TAX (APPEALS)-41, NEW DELHI QUA THE ASSESSMENT YEAR 2014-15 ON THE GROUNDS INTER ALIA T HAT : ITA NO.4942/DEL./2016 2 1. THAT ON FACTS OF THE APPELLANTS CASE AND IN LAW, THE ORDER PASSED BY COMMISSIONER (APPEALS) [CIT A] IS BAD, ERRONEOUS AND CONTRARY TO THE LAW IN HOLDING THE APPELLANT AS ASSESSEE-IN- DEFAULF. 2. THAT ORDER OF THE CIT A IS CONTRARY TO THE LAW AND THE FACTS OF THE CASE AS CITA ERRED IN PRONOUNCING DECISION (VIDE PARA 4.6.3 OF CIT AS ORDER ) ON THE BASIS OF PRACTICE FOLLOWED BY THE DEPARTMENT AND PRESUMPTION , AND NOT IN ACCORDANCE WITH THE PROVISIONS OF THE INCOME TAX ACT, 1961( ACT) 3. THAT CIT A ERRED ON FACTS AND IN LAW IN NOT HOLDING THE INTIMATION ISSUED UNDER SECTION 200A OF THE ACT VOI D AND LIABLE TO BE QUASHED. 4. THAT CIT A ERRED IN HOLDING THAT APPELLANT IS LIABL E FOR PAYMENT OF INTEREST UNDER SECTION 201(1 A) OF THE A CT. 5. THE APPELLANT CRAVES LEAVE TO ADD TO OR AMEND THE A FORESAID GROUNDS BEFORE DISPOSAL OF THE APPEAL. 2. BY WAY OF INTIMATION U/S 200A OF THE ACT A D EMAND OF RS. 64,08,780.19/- HAS BEEN RAISED DUE TO SHORT DEDUCT ION OF TDS BY THE ASSESSEE IN RESPECT OF PAYMENTS MADE TO A VARIO US PARTIES IN QUARTER ENDED MARCH, 2014. THE BALANCE DEMAND OF RS . 9,23,969/- IS THE INTEREST THEREON AS PER SECTION 201(1A). DET AIL OF DEMAND ON THE ACCOUNT OF ALLEGED SHORT DEDUCTION OF TAX AT SO URCE BY THE ASSESSEE IS AS UNDER :- NAME OF THE PARTY AMOUNT OF TDS DEMAND (RS.) SATKAR TRAVELS PVT. LTD. (PAN: AAOCS4577K) 689.00 TRAVEL (CO) INDIA (PAN : AAIPG5059M) 11,11,653.48 THE FEDERAL TRAVELS AND TOURS PRIVATE LIMITED (PAN : AADCT9952C) 18,701.61 AIR INDIA LTD (PAN : AACCN6194P) 2,282.12 GMR HYDERABAD INTERNATIONAL (PAN : AABCH3448M) 52,75,189.39 VARUN TRAVELS PVT. LTD. 264.59 ITA NO.4942/DEL./2016 3 (PAN : AAACV6976H) TOTAL 64,08,780.19 3. ASSESSEE CLAIMED THAT SHORT DEDUCTION IN CASE OF M/S. FEDERAL TRAVEL AND TOUR PVT. LTD. AND M/S. GMR HYDE RABAD INTERNATIONAL , THE LOWER TDS CERTIFICATES ISSUED TO THE DEDUCTEE S WERE ORIGINALLY VALID, BUT THE SAME WERE CANCELLED THEREAFTER, WITHOUT INFORMATION TO THE DEDUCTOR, WHICH HAS RESU LTED IN THE DEDUCTION OF TAX AT LOWER RATE, UNDER BONAFIDE BELI EF. IT IS SUBMISSION OF THE ASSESSEE THAT TAX AUTHORITIES HAV E NOT SENT THE LOWER TDS CERTIFICATES DIRECTLY TO THE DEDUCTOR, AS REQUIRED BY THE LAW NOR ANY INTIMATION HAS BEEN GIVEN ON CANCELLAT ION OF THE LOWER TDS CERTIFICATE. 4. ASSESSEE CARRIED THE MATTER BEFORE LD. CIT(A) B Y WAY OF FILING THE APPEAL WHO HAS PARTLY CONFIRMED THE DEMA ND BY PARTLY ALLOWING THE APPEAL. FEELING AGGRIEVED ASSESSEE HAS COME UP BEFORE THE TRIBUNAL BY WAY OF FILING THE PRESENT AP PEAL. 5. WE HAVE HEARD THE LD. AUTHORIZED REPRESENTATIVES OF THE PARTIES 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 A DEMAND OF RS. 73,32,750/- (RS. 64 ,08,780/- ITA NO.4942/DEL./2016 4 ON ACCOUNT OF SHORT DEDUCTION OF TAX + RS. 9,23,969 /- ON ACCOUNT OF INTEREST) U/S 201(1A) HAS BEEN RAISED AGAINST THE A SSESSEE. IT IS ALSO NOT IN DISPUTE THAT TAX AUTHORITIES HAS ORIGINALLY ISSUED LOWER TDS CERTIFICATE IN CASE OF M/S. FEDERAL TRAVELS AND TOUR PVT. LTD. AND M/S. GMR HYDERABAD INTERNATIONAL TO THE DEDUCTEES NOT DEDUCTORS. IT IS ALSO NOT IN DISPUTE THAT LOWER TD S CERTIFICATE ISSUED TO THE DEDUCTEES WAS CANCELLED BY THE REVENU E AUTHORITIES WITHOUT ANY INTIMATION TO THE DEDUCTORS AND CONSEQ UENTLY DEDUCTOR CONTINUE TO DEDUCT TAX ON LOWER RATE UNDER BONAFIDE BELIEF. 7. IN THE BACKDROP OF THE AFORESAID FACTS AND CIRCU MSTANCES OF THE CASE, WE ARE OF THE CONSIDERED VIEW THAT WHEN T AX AUTHORITIES HAVE NEVER GIVEN INTIMATION AS TO THE SHORT DEDUCTI ON OF TAX TO THE ASSESSEE RATHER SENT THE SAME TO THE DEDUCTEE AND T HE ASSESSEE CONTINUED TO DEDUCT THE TAX AT THE LOWER RATE, IT I S A BONAFIDE BELIEF ON THE PART OF ASSESSEE. 8. MOREOVER THE LOWER TDS CERTIFICATE ISSUED TO THE DEDUCTEES WHICH WAS ORIGINALLY VALID, BUT SAME WERE CANCELLED WITHOUT ANY INTIMATION TO THE DEDUCTOR. SO, THE ENTIRE EXERCISE OF SHORT DEDUCTION OF TAX BY THE ASSESSEE IS UNDER BONAFIDE BELIEF. THIS FACT IS PROVED FROM PARA 4.6.3 OF THE IMPUGNED ORDER PAS SED BY THE LD. CIT(A) WHICH IS EXTRACTED AS UNDER :- ITA NO.4942/DEL./2016 5 4.6.3 I AGREE WITH THE CONTENTION OF THE APPELLA NT THAT INFORMATION REGARDING LOWER TDS CERTIFICATES S HOULD BE CONVEYED TO THE DEDUCTOR AND ANY CANCELLATION OR MODIFICATION SHOULD BE COMMUNICATED BY THE DEPARTME NT TO THE DEDUCTOR. AT THE SAME TIME, IT CANNOT BE IGNORE D THAT AS A PRACTICE LOWER TDS CERTIFICATES ARE ISSUED TO THE D EDUCTEE, AS THE DEDUCTEE, BEING THE INTERESTED PARTY, MAKES APP LICATION FOR ISSUE OF SUCH CERTIFICATE. IT IS PRESUMED THAT ANY MODIFICATION OR CANCELLATION OF SUCH CERTIFICATE WI LL BE INTIMATED BY THE DEPARTMENT TO THE DEDUCTEE. IT IS THE DUTY OF THE DEDUCTEE/ PAYEE TO INFORM THE DEDUCTOR REGARDIN G ANY CHANGE IN THE LIMIT OR VALIDITY OF THE LTDC ISSUED BY THE DEPARTMENT. 9. ASSESSEE TO PROVE HIS BONAFIDE BROUGHT ON RECORD FORM 26A FROM TWO DEDUCTORS NAMELY M/S. FEDERAL TRAVELS AND TOUR PVT. LTD. AND M/S. GMR HYDERABAD INTERNATIONAL . THOUGH THE LD. CIT(A) HAS GIVEN PART RELIEF TO THE ASSESSEE BY NOT TREATING HIM ASSESSEE-IN-DEFAULT UNDER FIRST PROVISO TO SECTIO N 201(1A) OF THE ACT BUT HE HAS DIRECTED TO CHARGE THE INTEREST FROM THE DATE THE TAX WAS DEDUCTIBLE TILL THE DATE OF FILING OF INCOME TA X RETURNS BY THE DEDUCTEES UNDER PROVISO TO SECTION 201(1A). 10. WE ARE OF THE CONSIDERED VIEW THAT WHEN THE ASS ESSEE HAS NOT BEEN CONSIDERED ASSESSEE-IN-DEFAULT BY LD. CIT(A) AS HE HAS ATTRIBUTED SHORT DEDUCTION OF TAX DUE TO BONAFIDE BELIEF THAT A VALID TDS CERTIFICATE TO THE DEDUCTEES HAS ALREADY BEEN I SSUED, WHICH WAS CANCELLED WITHOUT ANY INTIMATION TO THE ASSESSE E, NO INTEREST CAN BE LEVIED. SO WHEN THE CANCELLATION OF THE TDS CERTIFICATE HAS NEVER BEEN INTIMATED TO THE ASSESSEE, ASSESSEE IS TREATED TO HAVE ITA NO.4942/DEL./2016 6 COMPLIED WITH THE PROVISIONS CONTAINED UNDER ACT FO R DEDUCTION OF TAX AT SOURCE. 11. IDENTICAL ISSUES HAVE BEEN DECIDED BY THE CO-OR DINATE BENCH OF TRIBUNAL IN FAVOUR OF ASSESSEE IN ITS OWN CASE I N RESPECT OF QUARTER NOS. 2 & 3 OF ASSESSMENT YEAR 2013-14 IN A PPEAL BEARING ITA NOS. 2954 & 2955/DEL/2015 VIDE ORDER DATED 7-9 -2018. 12. SO, IN VIEW OF WHAT HAS BEEN DISCUSSED ABOVE IN THE PRECEDING PARAS AND FOLLOWING ORDER DATED 7-9-2018 (SUPRA) PASSED BY CO-ORDINATE BENCH OF TRIBUNAL. WE ARE OF THE CON SIDERED VIEW THAT LD. CIT(A) HAS ERRED IN DIRECTING THE AO TO C HARGE THE INTEREST FROM THE DATE THE TAX WAS DEDUCTIBLE TILL THE DATE OF FILING THE INCOME TAX RETURN BY THE DEDUCTOR ON THE AMOUNT OF SHORT FALL IN TAX DEDUCTIBLE UNDER PROVISO TO SECTION 201(1A) OF THE ACT. SO, THE DEMAND RAISED ON ACCOUNT OF INTEREST VIDE ORDER PASSED BY LD. CIT(A) IS NOT SUSTAINABLE AS THE ASSESSEE IS NOT LI ABLE TO PAY THE INTEREST ON THE AMOUNT OF SHORT FALL IN TAX DEDUCTE D AT SOURCE, HENCE DELETED. CONSEQUENTLY, APPEAL FILED BY THE ASSESSE E IS ALLOWED. ORDER PRONOUNCED IN OPEN COURT ON THIS 26 TH DAY OF AUGUST, 2021. SD/- SD/- (ANIL CHATURVEDI) (KULDIP SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED THE 26 TH DAY OF AUGUST, 2021 *BINITA*