M/s Surjeet Auto Pvt. Limited, Bhopal V. Principal Commissioner of Income Tax -2, Bhopal

ITA 533/Ind/2018

• Counselvise Citation: [2019] 115 COUNSELVISE.COM (IT) 9055 (ITAT-INDORE)
• Duration Of Justice: 1 year(s) 3 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-09-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 09-09-2019
• Assessment Year: 2013-2014
• Appeal Filed On: 06-06-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ASHIMA GUPTA
• Assessee Lawyers: ASHOK VIJAYWARGIYA
• Keywords: Assessment record; TDS
• Section: 143(3); 263

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH, INDORE BEFORE SHRI KUL BHARAT, JUDICIAL MEMBER AND SHRI MANISH BORAD, ACCOUNTANT MEMBER ITA NO.533/IND/2018 ASSESSMENT YEAR: 2013-14 M/S SURJEET AUTO PVT. LTD. 07, LALA LAJPAT RAI NAGAR, RAISEN ROAD, BHOPAL / VS. PR. CIT-2 BHOPAL ( APPELLANT ) ( RE VENUE ) PAN: AAOCS9058H APPELLANT BY SHRI ASHOK VIJAY WARGIYA , CA RE VENUE BY SMT . ASHIMA GUPTA, CIT - DR DATE OF HEARING: 24.09.2019 DATE OF PRONOUNCEMENT: 27.09.2019 / O R D E R PER MANISH BORAD, A.M: THIS APPEAL AT THE INSTANCE OF ASSESSEE PERTAINING TO A.Y. 2013-14 IS DIRECTED AGAINST THE ORDER U/S 263 OF T HE INCOME TAX ACT 1961(HEREINAFTER CALLED AS THE ACT) OF PR. C OMMISSIONER OF INCOME TAX-2, BHOPAL, (IN SHORT CIT), DATED 09.03 .2018. 2. THE ASSESSEE HAS RAISED FOLLOWING GROUNDS OF APP EAL: 1. THAT, ON THE FACTS AND CIRCUMSTANCES OF THE CAS E AND IN LAW AND IN ANY VIEW OF THE MATTER, THE LD. PR. CIT HAS ERRED IN SETTING ASIDE THE ASSESSMENT COMPLETED U/S 143(3) O F THE ACT SURJEET AUTO PVT. LTD. ITANO.533/IND/2018 2 VIDE ASSESSMENT ORDER DATED. 15.10.2015 HOLDING THA T THE ORDER PASSED BY THE LD. ASSESSING OFFICER IS ERRONEOUS AN D PREJUDICIAL TO THE INTEREST OF THE REVENUE ON ACCOU NT OF NOT MAKING THE DISALLOWANCE OF RS.2,99,263/- OF EMPLOYE ES CONTRIBUTION TOWARDS PROVIDENT AFTER GIVING REASONA BLE OPPORTUNITY TO THE ASSESSEE OF BEING HEARD AND AFTE R BRINGING ON RECORDS THE RELEVANT SUPPORTING MATERIAL AND EVIDEN CES IN SUPPORT OF THE ACTION OF THE AO. 2. THAT, THE APPELLANT CRAVES LEAVE TO ADD/AMEND AN Y GROUND(S) OF APPEAL BEFORE AND/OR AT THE TIME OF HEARING. 3. BRIEFLY STATED FACTS AS CULLED OUT FROM THE RECO RDS ARE THAT THE ASSESSEE IS A PRIVATE LIMITED COMPANY ENGAGED IN TH E BUSINESS OF TRADING IN FOUR WHEELERS AND SPARE PART ACCESSORIES & SERVICING OF VEHICLES. INCOME OF RS.73,72,590/- DECLARED IN THE RETURN OF INCOME FILED ON 01.10.2013. ASSESSMENT U/S 143(3) OF THE A CT COMPLETED ON 15.10.2015 AFTER MAKING VARIOUS ADDITIONS AND ASSES SING INCOME AT RS.78,78,050/-. SUBSEQUENTLY, LD. PR. CIT, BHOPAL W HILE EXAMINING THE ASSESSMENT RECORDS OBSERVED THAT THE ASSESSEE H AS NOT DEPOSITED EMPLOYEES CONTRIBUTION TOWARDS PROVIDENT FUND AND HENCE THERE WAS A CONTRAVENTION OF SECTION 36(1)(VA ) OF THE ACT AND INTEREST ON TDS WAS NOT DISALLOWED. LD. AO FAILED T O EXAMINE THESE ISSUES. THUS, LD. PR. CIT INVOKED THE PROVISIONS OF SECTION 263 OF THE ACT AND HELD THAT THE ORDER OF THE ASSESSING OF FICER IS ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF THE REVENUE. 4. NOW THE ASSESSEE IS IN APPEAL BEFORE THE TRIBUNA L. LD. COUNSEL FOR THE ASSESSEE PLACED COPIES OF CHALLAN TO PROVE THAT THE ALLEGED AMOUNT OF EMPLOYEES CONTRIBUTION TOWARDS PROVIDENT FUND STANDS DEPOSITED BEFORE THE DUE DATE OF FILING OF INCOME AND THUS NO DISALLOWANCE U/S 36(1)(VA) IS CALLED FOR. AS REGARD S THE ALLEGED SURJEET AUTO PVT. LTD. ITANO.533/IND/2018 3 INTEREST PAID FOR DELAY IN PAYMENT OF TDS, IT WAS S UBMITTED THAT IT HAS BEEN WRONGLY INTERPRETED, SINCE THE ALLEGED AMO UNT REPRESENTS THE AMOUNT OF INCOME TAX OF THE PARTIES ON WHOSE BE HALF THE PAYMENT WAS DEDUCTED AND PAID TO THE GOVERNMENT EXC HEQUER. 5. PER CONTRA LD. DEPARTMENTAL REPRESENTATIVE (DR) SUPPORTED THE ORDER OF LD. PR. CIT. 6. WE HAVE HEARD RIVAL CONTENTIONS AND PERUSED THE RECORD PLACED BEFORE US. THE ASSESSEE HAS CHALLENGED THE ORDER U/ S 263 OF THE ACT FRAMED BY LD. PR. CIT HOLDING THAT THE ORDER OF LD. AO IS ERRONEOUS AND PREJUDICIAL TO THE INTERESTS OF THE REVENUE. IN THE ORDER U/S 263 OF THE ACT FOLLOWING TWO ISSUES WERE RAISED BY THE LD. PR. CIT: A) PERUSAL OF THE CASE RECORDS REVEALED THAT THE AS SESSEE HAD RECEIVED RS.2,99,263/- FROM ITS EMPLOYEES BEING THE IR CONTRIBUTION TOWARDS PROVIDENT FUND FOR THE FINANCI AL YEAR BUT, AS PER COLUMN NO.16B OF FORM -3CD REPORT (ANNEXURE- 16B), THE SAME AMOUNT WAS SHOWN TO BE NOT DEPOSITED WITHIN TH E TIME ALLOWED UNDER THE STATUTE AND HENCE THIS WAS IN CON TRAVENTION OF SECTION 36(1)(VA). THUS, THIS AMOUNT OF RS.2,99, 263/- WAS REQUIRED TO BE DISALLOWED AND ADDED BACK TO THE INC OME OF THE ASSESSEE WHICH HAS NOT BEEN SO DONE IN THE ASSESSME NT ORDER WITH THE RESULT THAT THE TOTAL INCOME HAS BEEN UNDE R ASSESSED TO THE TUNE OF RS.2,99,263/- ON THIS COUNT WITH CONSEQ UENTIAL SHORT LEVY OF TAX. B) PERUSAL OF ASSESSMENT RECORDS, FURTHER REVEALED THAT AS PER 3CD REPORT INTEREST ON TDS AMOUNTING TO RS.3,394/- WAS SURJEET AUTO PVT. LTD. ITANO.533/IND/2018 4 CERTIFIED AS INADMISSIBLE EXPENDITURE U/S 40(A) REF ERE CLAUSE 17(F) OR 3CD REPORT AND THEREFORE, THIS AMOUNT OF R S.3,394/- WAS REQUIRED TO BE DISALLOWED AND ADDED BACK TO THE INCOME OF THE ASSESSEE WHICH HAS NOT BEEN SO DONE IN THE ASSE SSMENT ORDER WITH THE RESULT THAT THE TOTAL INCOME HAS BEE N FURTHER UNDER ASSESSED TO THE TUNE OF RS.3,394/- WITH CONSE QUENTIAL SHORT LEVY OF TAX. 7. DURING THE COURSE OF ASSESSMENT PROCEEDINGS DETA ILED QUESTIONNAIRE WAS ISSUED TO THE ASSESSEE ON 20.07.2 015 CALLING FOR VARIOUS INFORMATION. IN COMPLIANCE THERETO REPLY WA S SUBMITTED BY THE ASSESSEE ALONG WITH PRODUCING BOOKS OF ACCOUNT. THE ADDITIONS IN THE FORM OF DISALLOWANCE OF VARIOUS EXPENSES INC LUDING DONATION, BUSINESS PROMOTION, CONVEYANCE AND TRAVELLING, TELE PHONE, PRINTING AND STATIONARY, FUEL AND DELIVERY CHARGES WERE MADE WHICH SHOWS THAT BOOKS OF ACCOUNTS HAVE BEEN EXAMINED BY THE LD . AO ON TEST CHECK BASIS. 8. AS REGARDS THE FIRST ISSUE OF THE ALLEGED NON-D EPOSITING OF EMPLOYEES CONTRIBUTION TOWARDS PROVIDENT FUND, ON P ERUSAL OF RECORDS WE FIND THAT THE ASSESSEE HAS DEPOSITED THE ALLEGED AMOUNT OF EMPLOYEES CONTRIBUTION TOWARDS PROVIDENT FUND BE FORE THE DUE DATE OF FILING OF RETURN OF INCOME AND COPIES OF CH ALLAN ARE PLACED BEFORE US LD. COUNSEL FOR THE ASSESSEE STATED AS AN OFFICER OF COURT THAT THE ALLEGED CONTRIBUTION TO PROVIDENT FUND HAS BEEN DEPOSITED BEFORE THE DUE DATE FOR FILING THE RETURN OF INCOME . 9. WITH REGARD TO THE SECOND ISSUE OF INTEREST ON D ELAYED PAYMENT OF TDS, WE FIND FORCE IN THE CONTENTION OF LD. COUNSEL FOR THE ASSESSEE SURJEET AUTO PVT. LTD. ITANO.533/IND/2018 5 THAT THE ALLEGED AMOUNT OF INTEREST IS NOT FOR LATE DEPOSITS OF TDS. THE SAME REPRESENT THE AMOUNT OF INCOME TAX OF THE PARTY ON WHOSE BEHALF THE PAYMENT WAS DEDUCTED AND PAY TO THE GOVE RNMENT AND THUS CLAIMED AS AN EXPENDITURE IN THE PROFIT AND LO SS ACCOUNT. 10. LD. PR. CIT WHILE CONDUCTING PROCEEDINGS U/S 26 3 OF THE ACT AND BEFORE HOLDING THAT THE ORDER OF THE LD. AO IS ERRO NEOUS, INSOFAR AS, IT IS PREJUDICIAL TO THE INTEREST OF REVENUE, SHOUL D HAVE MADE SUCH INQUIRY AS HE DEEM NECESSARY. SINCE BOTH THESE ISSU ES WHICH WERE THE BASIS FOR HOLDING THE ORDER OF THE LD. AO IS ER RONEOUS AND PREJUDICIAL TO THE INTERESTS OF THE REVENUE ARE SET TLED WITH THE NECESSARY EVIDENCES PLACED ON RECORD BY THE ASSESSE E, IN OUR CONSIDERED VIEW LD. PR. CIT WRONGLY ASSUMED THE JUR ISDICTION AND THUS THE ORDER U/S 263 OF THE ACT DESERVES TO BE QU ASHED AND THE ORDER OF THE LD. AO U/S 143(3) OF THE ACT DATED 15. 10.2015 IS RESTORED. 11. IN THE RESULT, THE APPEAL OF THE ASSESSEE STAND S ALLOWED. ORDER WAS PRONOUNCED IN THE OPEN COURT ON 27 .09.2 019. SD/- (KUL BHARAT) SD/- (MANISH BORAD) JUDICIAL MEMBER ACCOUNTANT MEMBER INDORE; DATED : 27/09/2019 CTX? P.S/. . . SURJEET AUTO PVT. LTD. ITANO.533/IND/2018 6 COPY TO: ASSESSEE/AO/PR. CIT/ CIT (A)/ITAT (DR)/GUAR D FILE. BY ORDER ASSISTANT REGISTRAR