Appeal details
Counselvise Citation
[2018] 126 COUNSELVISE.COM (IT) 3305 (ITAT-DELHI)
Assessee PAN
Bench
Appeal Number
Duration Of Justice
1 year(s) 5 month(s) 15 day(s)
Appellant
Respondent
Appeal Type
Income Tax Appeal
Pronouncement Date
08-03-2018
Appeal Filed By
Assessee
Order Result
Dismissed
Bench Allotted
E
Assessment Year
2014-2015
Appeal Filed On
23-09-2016
Judgement Text
IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES E : DELHI BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND SHRI WASEEM AHMED, ACCOUNTANT MEMBER ITA.NOS.5035, 5036, 5037 & 5038/DEL./2016 ASSESSMENT YEARS 2011-12, 2012-13, 2013-14 & 2014-1 5 NOIDA SPECIAL ECONOMIC ZONE AUTHORITY, DADRI ROAD, PHASE-2, NOIDA. PAN AAALN0639A VS THE ADDL. CIT (TDS) CGO COMPLEX-1, HAPUR ROAD, GHAZIABAD. (APPELLANT) (RESPONDENT) FOR ASSESSEE : SHRI H. HASNAIN, A.R. FOR REVENUE : SHRI S.R. SENAPATI, SR. DR DATE OF HEARING : 0 8 .03.2018 DATE OF PRONOUNCEMENT : 08 .03.2018 ORDER PER BHAVNESH SAINI, J.M. ALL THE APPEALS BY ASSESSEE ARE DIRECTED AGAINST THE COMMON ORDER OF THE LD. CIT(A)-1, NOIDA, DATED 29 TH JUNE, 2016, FOR THE A.YS. 2011-2012 TO 2014-2015, CHALLEN GING THE LEVY OF PENALTY UNDER SECTION 271C OF THE I.T. ACT, 1961. 2 ITA.NOS.5035, 5036, 5037 & 5038/DEL./2016 NOIDA SPEC IAL ECONOMIC ZONE AUTHORITY, NOIDA. 2. BRIEFLY, THE FACTS OF THE CASE ARE THAT AS NOTE D IN THE PENALTY ORDER ARE THAT DURING VERIFICATION IN THE C ASE OF THE ASSESSEE, IT WAS NOTICED THAT ASSESSEE HAS MADE PAY MENT OF LEASE RENT TO NOIDA AUTHORITY, ON WHICH, NO TDS WAS DEDUCTED AS PER THE PROVISIONS OF SECTION 194-I OF THE I.T. ACT. THE A.O. PASSED THE ORDERS UNDER SECTIONS 201(1) / 201(1A) O F THE ACT ON 25 TH MARCH, 2015 FOR NON-DEDUCTION OF TAX AND ALSO INIT IATED THE PENALTY PROCEEDINGS. THE ASSESSEE SUBMITTED BEFORE A.O. THE DETAILS WITH EXPLANATORY NOTE THAT TDS DEDUCTION IS NOT APPLICABLE IN THE CASE OF NOIDA AUTHORITY. THE A.O. HOWEVER, IN THE ORDER UNDER SECTION 201 OF THE ACT OBSERVED THA T NOIDA AUTHORITY IS NOT EXEMPT AS IT IS NOT LOCAL AUTHORIT Y. THE STATUS OF NOIDA AUTHORITY AS LOCAL AUTHORITY HAS NOT BEEN ACCEPTED BY THE HONBLE ALLAHABAD HIGH COURT IN THE WRIT PETITI ON FILED BY NOIDA AUTHORITY. THE A.O. DID NOT ACCEPT THE CONTEN TION OF ASSESSEE BECAUSE ASSESSEE FAILED TO DEDUCT TAX AT S OURCE AND HAS FAILED TO PROVE ANY REASONABLE CAUSE FOR SUCH F AILURE. THE ONLY REASON PUT-FORTH BY THE ASSESSEE WAS THAT NOID A AUTHORITY FAILED TO CLARIFY ITS POSITION WHETHER IT IS EXEMPT UNDER 3 ITA.NOS.5035, 5036, 5037 & 5038/DEL./2016 NOIDA SPEC IAL ECONOMIC ZONE AUTHORITY, NOIDA. PROVISIONS OF SECTION 10(20) OF THE I.T. ACT AND AL SO COULD NOT PRODUCE ANY TAX EXEMPTION CERTIFICATE UNDER SEC TION 197 OF THE I.T. ACT ISSUED BY THE INCOME TAX DEPARTMENT. T HE A.O, THEREFORE, HELD THAT ASSESSEE HAS NO REASONABLE CAU SE FOR NON- DEDUCTION OF TDS ON THE PAYMENTS OF LEASE RENT PAID TO NOIDA AUTHORITY. THE A.O. RELIED UPON THE DECISION OF HON BLE KERALA HIGH COURT IN THE CASE OF US TECHNOLOGIES INTERNATI ONAL LTD., VS. CIT 195 TAXMAN 323 WHEREIN IT WAS HELD THAT FAILURE TO DEDUCT TAX AND FAILURE TO REMIT RECOVERED TAX BOTH WILL ATTRACT PENALTY UNDER SECTION 271C OF THE I.T. ACT. THE A.O, THEREFORE, HELD THAT IT IS A FIT CASE FOR LEVY OF PENALTY AND ACCORDINGLY, LEVIED THE PENALTY FOR ALL THE ASSESSMENT YEARS UNDER APPE AL VIDE SEPARATE ORDERS. 3. THE LD. CIT(A) DECIDED ALL THE APPEALS OF THE A SSESSEE THROUGH THE COMMON CONSOLIDATED ORDER. THE LD. CIT( A) NOTED THAT AS REGARDS FACTS, THERE IS NO DISPUTE THAT ASS ESSEE DID NOT DEDUCT TAX ON THE AMOUNTS PAID AS LEASE RENT TO NOI DA AUTHORITY. THE ASSESSEE SUBMITTED BEFORE LD. CIT(A) THAT THIS 4 ITA.NOS.5035, 5036, 5037 & 5038/DEL./2016 NOIDA SPEC IAL ECONOMIC ZONE AUTHORITY, NOIDA. LAPSE HAPPENED BECAUSE OF THE CLAIM OF NOIDA AUTHOR ITY THAT IT WAS NOT LIABLE FOR DEDUCTION OF TAX AT SOURCE. THE LD. CIT(A) DID NOT ACCEPT THE CONTENTION OF ASSESSEE BECAUSE THE D EDUCTEE CANNOT INFLUENCE THE DEDUCTOR IN NOT FOLLOWING THE LAW. THE ASSESSEE ALSO FAILED TO PROVE ANY REASONABLE CAUSE. THEREFORE, ALL THE APPEALS OF THE ASSESSEE WERE DISMISSED. 4. THE LEARNED COUNSEL FOR THE ASSESSEE REITERATED THE SUBMISSIONS MADE BEFORE THE AUTHORITIES BELOW AND S UBMITTED THAT ASSESSEE MADE EFFORTS TO GET CLARIFICATION FRO M NOIDA AUTHORITY WHETHER ITS INCOME IS EXEMPT UNDER SECTIO N 10(20) OF THE I.T. ACT. BUT, THERE WAS NO REPLY GIVEN BY THEM . HE HAS SUBMITTED THAT DUE TO ABOVE REASONABLE CAUSE, THE A SSESSEE DID NOT DEDUCT TDS, THEREFORE, PENALTY MAY NOT BE IMPOS ED. 5. THE LD. D.R. HOWEVER, OBJECTED TO THE SUBMISSIO NS OF THE LEARNED COUNSEL FOR THE ASSESSEE BECAUSE ASSESS EE WITHOUT ANY JUSTIFICATION DID NOT DEDUCT TAX AT SOURCE DESP ITE WRIT PETITION OF NOIDA AUTHORITY WAS DISMISSED BY HONBL E ALLAHABAD HIGH COURT ON 28.02.2011 BY HOLDING THAT IT IS NOT LOCAL 5 ITA.NOS.5035, 5036, 5037 & 5038/DEL./2016 NOIDA SPEC IAL ECONOMIC ZONE AUTHORITY, NOIDA. AUTHORITY. THEREFORE, IT IS A CLEAR CASE OF NEGLIGE NCE ON THE PART OF THE ASSESSEE IN NOT DEDUCTING TDS. THEREFORE, PE NALTY MAY BE CONFIRMED. 6. AFTER CONSIDERING THE RIVAL SUBMISSIONS, WE DO NOT FIND ANY MERIT IN THE APPEALS OF THE ASSESSEE. THE PENALTY UNDER SECTION 271C OF THE I.T. ACT IS LEVIABLE FOR FAILUR E TO DEDUCT TAX AT SOURCE. SECTION 273B OF THE ACT PROVIDES THAT PE NALTY NEED NOT BE IMPOSED ON THE PERSON OR THE ASSESSEE AS THE CASE MAY BE FOR FAILURE REFERRED TO ABOVE, IF THE ASSESSEE P ROVES THAT THERE WAS A REASONABLE CAUSE FOR THE SAID FAILURE. THE A. O. IN THE ORDER UNDER SECTIONS 201(1) / 201(1A) OF THE I.T. ACT, SP ECIFICALLY NOTED THE EXPLANATION OF ASSESSEE IN WHICH IT WAS SUBMITT ED BY ASSESSEE THAT ASSESSEE REQUESTED THE NOIDA AUTHORIT Y TO CLARIFY THEIR POSITION WHETHER THEIR INCOME IS EXEMPT, BUT, NO REPLY HAVE BEEN RECEIVED FROM THEM. PRIOR TO IT, THE WRIT PETITION OF NOIDA AUTHORITY WAS DISMISSED BY HONBLE ALLAHABAD HIGH COURT. THE A.O. ULTIMATELY, REJECTED THE CONTENTION OF ASSESSEE AND PASSED THE ORDER FOR RECOVERY OF THE SHORT DEDU CTION WITH 6 ITA.NOS.5035, 5036, 5037 & 5038/DEL./2016 NOIDA SPEC IAL ECONOMIC ZONE AUTHORITY, NOIDA. INTEREST. THE ASSESSEE IN THE PENALTY PROCEEDINGS C LAIMED BEFORE A.O. THAT INCOME OF THE NOIDA AUTHORITY EXEMPT UNDE R SECTION 10(20) OF THE I.T. ACT, WHICH FACT WAS ALSO HAS NOT PROVED BY THE ASSESSEE BECAUSE IT WAS INCORRECT. THEREFORE, THE A SSESSEE HAD BEEN NEGLIGENT IN NOT DEDUCTING TDS ON LEASE RENT P AID TO NOIDA AUTHORITY WITHOUT ANY JUSTIFICATION. SINCE ASSESSEE FAILED TO PROVE ITS BONAFIDE THROUGH ANY RELEVANT AND COGENT EVIDENCE, THEREFORE, ASSESSEE CANNOT TAKE BENEFIT OF SECTION 273B OF THE I.T. ACT AS THE ASSESSEE HAS FAILED TO PROVE ANY RE ASONABLE CAUSE FOR FAILURE TO COMPLY WITH PROVISIONS OF LAW. NO IN TERFERENCE IS CALLED FOR IN THE MATTER. 7. LEARNED COUNSEL FOR THE ASSESSEE LASTLY SUBMITT ED THAT SINCE THE ASSESSEE MOVED AN APPLICATION UNDER SECTION 154 BEFORE LD. CIT(A) FOR RECTIFICATION OF THE IMPUGNED ORDER, THEREFORE, APPEALS OF THE ASSESSEE MAY BE KEPT IN A BEYANCE. LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT ASS ESSEE CHALLENGED FOR THE FIRST TIME BEFORE LD. CIT(A) THA T THE PENALTY ORDERS ARE TIME BARRED. THIS ISSUE IS NOT ARISING O UT OF THE ORDERS 7 ITA.NOS.5035, 5036, 5037 & 5038/DEL./2016 NOIDA SPEC IAL ECONOMIC ZONE AUTHORITY, NOIDA. OF THE AUTHORITIES BELOW AND EVEN THE ASSESSEE HAS NOT MOVED ANY PROPER APPLICATION FOR ADMISSION OF ADDITIONAL GROUND BEFORE THE TRIBUNAL THAT ASSESSMENT ORDER IS TIME B ARRED, THEREFORE, SUCH PLEA OF THE ASSESSEE CANNOT BE ENTE RTAINED AT THIS STAGE. THE REQUEST OF THE ASSESSEE FOR KEEPING THE APPEALS IN ABEYANCE IS ACCORDINGLY REJECTED. IN VIEW OF THE ABOVE, APPEALS OF THE ASSESSEE HAVE NO MERIT AND SAME ARE ACCORDINGLY DISMISSED. HOWEVER, WE, DIRECT THE LD. CIT(A) TO EX PEDITE THE DISPOSAL OF APPLICATION OF ASSESSEE UNDER SECTION 1 54 OF THE I.T. ACT INDEPENDENTLY WITHOUT BEING INFLUENCED BY THIS ORDER. 8. IN THE RESULT, ALL THE APPEALS OF THE ASSESSEE ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT. SD/- SD/- (WASEEM AHMED) (BHAVNESH SAINI) ACCOUNTANT MEMBER JUDICIAL MEMBER DELHI, DATED 08 TH MARCH, 2018 VBP/- 8 ITA.NOS.5035, 5036, 5037 & 5038/DEL./2016 NOIDA SPEC IAL ECONOMIC ZONE AUTHORITY, NOIDA. COPY TO 1. THE APPELLANT 2. THE RESPONDENT 3. CIT(A) CONCERNED 4. CIT CONCERNED 5. D.R. ITAT E BENCH, DELHI 6. GUARD FILE. // BY ORDER // ASSISTANT REGISTRAR : ITAT DELHI BENCHES : DELHI.
