VENUS ELECTRONICS AND CONTROLS PVT. LTD., MUMBAI V. ITO (TDS) - 2(3)(3), MUMBAI

ITA 5073/MUM/2018

• Counselvise Citation: [2019] 111 COUNSELVISE.COM (IT) 9904 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 3 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-12-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: F
• Assessment Year: misc
• Appeal Filed On: 04-09-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MOHAMMED RIZWAN
• Assessee Lawyers: SUHAS JOSHI
• Keywords: Sale consideration of property below Jantri Value; TDS
• Section: 234E; 200A; 192

Judgement Text

IN THE INCOME-TAX APPELLATE TRIBUNAL F BENCH MUMB AI BEFORE SHRI PAWAN SINGH JUDICIAL MEMBER AND SHRI S. RIFAUR RAHMAN, ACCOUNTANT MEMBER ITA NO. 5073/MUM/2018 (ASSESSMENT YEAR 2013-14 ) VENUS ELECTRONICS AND CONTROLS PVT. LTD., PLOT NO. 44-45, MIDC INDL. AREA, STREET NO.14, MIDC, ANDHERI EAST, MUMBAI- 400093. PAN: AAACV4450C VS. ITO (TDS) 2(3)(3) MUMBAI. APPELLANT RESPONDE NT APPELLANT BY : SHRI SUHAS JOSHI (AR) RESPONDENT BY : SHRI MOHAMMED RIZWAN (DR) DATE OF HEARING : 12.12.2019 DATE OF PRONOUNCEMEN T : 18.12.2019 ORDERUNDER SECTION 254(1)OF INCOME TAX ACT PER PAWAN SINGH, JUDICIAL MEMBER ; 1. THIS APPEAL BY ASSESSEE IS DIRECTED AGAINST THE ORD ER OF LD. CIT(A)-59, MUMBAI DATED 29.06.2018 FOR ASSESSMENT YEAR 2013-14 , WHICH IN TURN ARISES FROM THE ORDER UNDER SECTION 200A PASSED BY ASSESSING OFFICER DATED 29.12.2013. THE ASSESSEE HAS RAISED THE FOLLO WING GROUNDS OF APPEAL: (FOR Q-3 IN AY 2013-14 THE ASSESSEE HAS RAISED FOLL OWING GROUNDS OF APPEAL) 1. THE TDS ASSESSING OFFICER [DCIT( CPC) TDS ] ERRED I N DETERMINING INTEREST ON LATE PAYMENT RS. 1,155/- FOR 24Q3 FY 20 12-13. ITA NO. 5073 MUM 2018-VENUS ELECTRONIC S AND CONTROLS PVT. LTD. 2 2. THE CIT (A) ERRED IN CONFIRMING THE ORDER PASSED BY TDS ASSESSING OFFICER [ DCIT( CPC ) TDS ] IN DETERMINING INTEREST ON LATE PAYMENT RS. 1,155/- FOR 24Q3 FY 2012-13. 3. THE TDS ASSESSING OFFICER ERRED IN DETERMINING LATE FILING FEES U/S 234E OF THE INCOME TAX ACT 1961, AMOUNTING TO RS.30,600/- I N RESPECT OF 24Q3 FY 2012-13. 4. THE CIT (A) ERRED IN CONFIRMING THE ORDER PASSED BY TDS ASSESSING OFFICER [ DCIT(CPC) TDS IN LEVYING LATE FILING FEES U/S 234 E OF THE INCOME TAX ACT 1961, AMOUNTING TO RS.30,600/- IN RESPECT OF 24 Q3 FY 2012-13. 5. THE ASSESSEE CRAVES LEAVE TO AMEND ANY OF THE ABOVE GROUNDS OF APPEAL. 2. (FOR Q-4 IN AY 2013-14 THE ASSESSEE HAS RAISED FOLL OWING GROUNDS OF APPEAL) 1. THE TDS ASSESSING OFFICER [DCIT( CPC) TDS ] ERRED I N DETERMINING INTEREST ON LATE PAYMENT RS. 6,600/- FOR 24Q4 FY 2012-13. 2. THE CIT (A) ERRED IN CONFIRMING THE ORDER PASSED BY TDS ASSESSING OFFICER [ DCIT( CPC ) TDS ] IN DETERMINING INTEREST ON LATE P AYMENT RS. 3,600/- IN RESPECT OF 24Q4 FY 2012-13. 3. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE IS A COMPANY AND ITS COURSE OF BUSINESS MADE CERTAIN PAYMENTS TO VARIOUS PARTIES A ND DEDUCTED TAX AT SOURCE (TDS) AND FURNISHED TDS RETURN IN RESPECT OF SECTION 24Q3 AND Q4 FOR F.Y. 2012-13, THERE WAS DELAY IN FILING TDS RETURN. ACCORDINGLY, THE CENTRAL PROCESSING CELL (TDS-CPC/ AO) GHAZIABAD PROCESSED THE RETURNS OF BOTH THE QUARTERS (Q) CALCULATED INTERES T AND LATE FEE UNDER SECTION 234E VIDE INTIMATION DATED 29.12.2013. FOR Q3 THE AO/ TDS- CPC DETERMINED INTEREST OF LATE PAYMENT OF RS. 1155 /- AND LATE FEE UNDER SECTION 234E OF RS. 30,600/-. SIMILARLY FOR Q4 OF A Y 2013-14 A LATE FEE UNDER SECTION 234E OF RS. 6600/- WAS RAISED. ITA NO. 5073 MUM 2018-VENUS ELECTRONIC S AND CONTROLS PVT. LTD. 3 4. AGGRIEVED BY THE ACTION OF TDS-CPC/ AO THE ASSESSEE FILED APPEAL BEFORE THE LD. CIT(A). BEFORE LD CIT(A) THE ASSESSE E RAISED A CONTENTION THAT PERIOD INVOLVED IN THE APPEALS ARE PRIOR TO 01 .06.2015 THAT IS PRIOR TO INSERTION OF SECTION 234E AND AMENDMENT IN SUBSTITU TION OF CLAUSE (C) TO SECTION 200A, VIDE WHICH IT HAS BEEN PROVIDED THAT FEE PAYABLE UNDER SECTION 234E CAN BE ADJUSTED WHILE PROCESSING INTI MATION UNDER SECTION 234E. THUS, THE ADJUSTMENT MADE WITH REGARD TO FEE LEVIABLE UNDER SECTION 234E WHILE PROCESSING TDS STATEMENT UNDER S ECTION 200A FOR THE PERIOD PRIOR TO 01.06.2015 IS NOT LEGALLY VALID. TH E ASSESSEE ALSO RELIED ON THE VARIOUS DECISIONS OF THE TRIBUNAL, INCLUDING THE DECISION OF MUMBAI TRIBUNAL IN KASH REALTORS PVT LTD VS ITO (IT A NO. 4199/MUM/2015 DATED 27.07.2016). THE ASSESSEE URGED THAT THE DECISION IN KASH REALTORS PVT LTD VS ITO (SUPRA), THE TRIBUN AL FOLLOWED THE DECISION OF KARNATAKA HIGH COURT IN FATEHRAJ SINGHV I VS UNION OF INDIA REPORTED VIZ (73 TAXMANN.COM 252). 5. THE SUBMISSIONS OF THE ASSESSEE ON THE FACTS AND LA W WAS NOT ACCEPTED BY THE LD CIT(A). THE LD CIT(A) CONFIRMED THE ACTIO N OF AO/ CPC-TDS FOR BOTH THE QUARTERS(QS) BY MAKING RELIANCE ON THE DECISION OF GUJARAT HIGH COURT IN RAJESH KOURAMI VS UNION OF INDIA (83 TAXMANN.COM 137) BY TAKING VIEW THAT THE DECISION OF GUJARAT HIGH CO URT IS LATEST ONE. THOUGH, THE ASSESSEE REFERRED AND RELIED ON THE DEC ISION OF HONBLE APEX COURT IN CIT VS VEGETABLE PRODUCT (88 ITR 192 SC) O N THE RATIO THAT IF ITA NO. 5073 MUM 2018-VENUS ELECTRONIC S AND CONTROLS PVT. LTD. 4 TWO REASONABLE CONSTRUCTIONS OF TAXING STATUE ARE P OSSIBLE, THAT CONSTRUCTION WHICH FAVOURS THE ASSESSEE MUST BE ADO PTED. THE LD CIT(A) NOT ACCEPTED THE RATIO IN CIT VS VEGETABLE PRODUCT (SUPRA) BY TAKING VIEW THAT THE SAME GIVEN ON PENALTY PROVISION. THU S, FURTHER AGGRIEVED BY THE ORDER OF LD. CIT(A), THE ASSESSEE HAS FILED THE PRESENT APPEAL BEFORE THIS TRIBUNAL. 6. WE HAVE HEARD THE SUBMISSIONS OF THE LEARNED AUTHOR ISED REPRESENTATIVE (LD AR) FOR THE ASSESSEE AND THE LEARNED DEPARTMENT AL REPRESENTATIVE (LD DR) FOR THE REVENUE AND PERUSED THE RECORD CAREFULL Y. AT THE OUTSET OF HEARING, THE LD. AUTHORIZED REPRESENTATIVE (AR) OF THE ASSESSEE SUBMITS THAT THE GROUNDS OF APPEAL RAISED BY ASSESSEE IN TH E PRESENT APPEAL IS COVERED BY THE VARIOUS DECISION OF TRIBUNAL INCLUDI NG THE DECISION OF TRIBUNAL IN PERMANENT MAGNETS LTD. VS. DCIT IN ITA NO. 6436 TO 6442/MUM/2018, WHEREIN IT WAS HELD THAT PROVISION O F SECTION 234E, 200A IS LIABLE TO BE IMPOSED W.E.F. 01.06.2015 AND ACCORDINGLY, NO FEES/LEVY IS LEVIABLE UNDER SECTION 234E. THE LD. A R FOR THE ASSESSEE ALSO RELIED ON THE DECISION OF KARNATAKA HIGH COURT IN F ATHERAJ SINGHVI VS UOI (SUPRA) AND HONBLE APEX COURT IN CIT VS VEGETA BLE PRODUCT (SUPRA). 7. ON THE OTHER HAND, THE LD. DEPARTMENTAL REPRESENTAT IVE (DR) FOR THE REVENUE SUPPORTED THE ORDER OF LOWER AUTHORITIES. ITA NO. 5073 MUM 2018-VENUS ELECTRONIC S AND CONTROLS PVT. LTD. 5 8. WE HAVE CONSIDERED THE SUBMISSION OF BOTH THE PARTI ES AND PERUSED THE MATERIAL AVAILABLE ON RECORD CAREFULLY. WE HAVE ALS O DELIBERATED ON THE VARIOUS CASE LAWS REFERRED BY LD CIT (A) IN THE IMP UGNED ORDER. WE HAVE NOTED THAT CPC-TDS/AO INITIATED THE DEMAND FOR QUA RTER NO.3 & 4 FOR A.Y. 2013-14 VIDE INTIMATION/ORDER DATED 29.12.2013 . FOR Q3 THE AO/ TDS-CPC INITIATED INTEREST OF LATE PAYMENT OF RS. 1 155/- AND LATE FEE UNDER SECTION 234E OF RS. 30,600/-. SIMILARLY FOR Q 4 OF AY 2013-14 A LATE FEE UNDER SECTION 234E OF RS. 6600/- WAS RAISE D. THE LD CIT(A) AFFIRMED THE ACTION OF AO ON THE BASIS OF DECISION OF GUJARAT HIGH COURT IN RAJESH KOURAMI VS UNION OF INDIA (SUPRA). 9. THE LD AR FOR THE ASSESSEE VEHEMENTLY RELIED ON THE DECISION OF KARNATAKA HIGH COURT IN FATHERAJ SINGHVI VS UOI (SU PRA), WHEREIN IT WAS HELD THAT THE AMENDMENT IN SECTION 200A HAS COM E INTO EFFECT ON 01.06.2015 AND HAS PROSPECTIVE EFFECT, NO COMPUTATI ON OF FEE FOR THE DEMAND OR THE INTIMATION FOR FEE UNDER SECTION 234E CAN BE MADE FOR TDS DEDUCTED PRIOR TO 01.06.2015, HENCE, THE DEMAND OF FEE UNDER SECTION 234E IS WITHOUT AUTHORITY OF LAW. THE LD CI T(A) AFFIRMED THE ACTION OF AO/ CPC-TDS BY RELYING ON THE DECISION OF GUJARAT HIGH COURT IN RAJESH KOURAMI VS UNION OF INDIA (SUPRA). 10. THE HON'BLE GUJARAT HIGH COURT IN THE CASE OF RAJESH KOURANI V. UOI [2017] 83 TAXMANN.COM 137/249 TAXMAN 402 WHEREIN TH E HON'BLE HIGH COURT TOOK A VIEW THAT LEVY OF FEE U/S. 234E OF THE ACT IS POSSIBLE EVEN ITA NO. 5073 MUM 2018-VENUS ELECTRONIC S AND CONTROLS PVT. LTD. 6 WITHOUT A REGULATORY PROVISION U/S. 200A OF THE ACT AND THEREFORE THE LEVY OF FEE U/S. 234E OF THE ACT W.E.F.1.7.2012, WH EN THOSE PROVISIONS WERE INTRODUCED, WAS VALID. 11. NO DECISION OF JURISDICTIONAL HIGH COURT IS BROUGH T TO OUR NOTICE, NOW WE ARE FACED WITH THE DECISION OF THE HON'BLE HIGH COU RT OF KARNATAKA IN FATHERAJ SINGHVI VS UOI (SUPRA), WHICH FAVOURED THE ASSESSEE AND ON THE CONTRARY THE DECISION OF GUJARAT HIGH COURT IN RAJESH KOURANI V. UOI(SUPRA). THEREFORE, CONSIDERING THE RATIO OF DECISION OF HO NBLE APEX COURT IN VEGETABLE PRODUCTS (SUPRA), THAT IF T WO REASONABLE CONSTRUCTIONS OF TAXING STATUE ARE POSSIBLE, THAT C ONSTRUCTION WHICH FAVOURS THE ASSESSEE MUST BE ADOPTED. ACCORDINGLY W E ARE ACCEPTING THE VIEW TAKEN BY HON'BLE HIGH COURT OF KARNATAKA IN FA THERAJ SINGHVI VS UOI (SUPRA), CONSIDERING THE AFORESAID FACTUAL AND LEGAL POSITION, WE ARE OF THE VIEW THAT NO INTEREST AND LATE FEES UNDER SE CTION 234E IS LEVIABLE AGAINST THE ASSESSEE AS THE PROVISION OF SECTION 23 4E HAS BEEN BROUGHT ON STATUTE BOOK W.E.F. 01.06.2015 AND ACCORDINGLY, NO FEE IS LEVIABLE UNDER SECTION 234E. 12. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 18/12/2019. SD/- SD/- S. RIFAUR RAHMAN PAWAN SINGH ACCOUNTANT MEMBER J UDICIAL MEMBER MUMBAI, DATE: 18.12.2019 SK ITA NO. 5073 MUM 2018-VENUS ELECTRONIC S AND CONTROLS PVT. LTD. 7 COPY OF THE ORDER FORWARDED TO : 1. ASSESSEE 2. RESPONDENT 3. THE CONCERNED CIT(A) 4. THE CONCERNED CIT 5. DR F BENCH, ITAT, MUMBAI 6. GUARD FILE BY ORDER, DY./ASST. REGISTRAR ITAT, MUMBAI