Siddhi Vinayak Cement Pvt. Ltd., Ahmedabad V. The Dy.CIT, Centralized Processing Cell-TDS, Gaziabad

ITA 553/AHD/2015

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 0177 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 7 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-10-2016
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Assessment Year: 2013-2014
• Appeal Filed On: 13-03-2015
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Assessee Lawyers: H C SHAH
• Keywords: Rectification of order
• Section: 154

Judgement Text

I.T.A. NO. 553 /AHD/201 5 ASSESSMENT YEAR: 20 13 - 14 PAGE 1 OF 6 IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD A BENCH, AHMEDABAD [CORAM: R.P. TOLANI, J.M. AND PRAMOD KUMAR , A . M . ] I.T.A. NO. 553 /AHD/201 5 ASSESSMENT YEAR: 20 13 - 14 SIDDHI VINAYAK CEMENT PVT. LTD. .. . . APPELLANT NIRMA HOUSE, ASHRAM ROAD, AHMEDABAD. [PAN: AA LCS 7628 G ] VS. DY. COMMISSIONER OF INCOME TAX , CENTRALISED PROCESSING CELL TDS GHAZIABAD. ... . . RESPONDENT APPEARANCES BY: H.C. SHAH FOR THE APPELLANT K. MADHUSUDAN FOR THE RESPONDENT DATE O F CONCLUDING THE HEARING : 2 9 .07.2016 DATE OF PRONOUNC ING THE ORDER : 27 . 10.2016 O R D E R PER PRAMOD KUMAR , AM : 1. THIS APPEAL, FILED BY THE ASSESSEE, IS DIRECTED AGAINST THE ORDER DATED 6 TH JANUARY, 2015 PASSED BY THE CIT(A) IN THE MATTER OF PROCESSIN G OF TDS RETURN UNDER SECTION 200A OF THE INCOME TAX ACT, 1961, FOR THE ASSESSMENT YEAR 2013 - 14. 2. GRIEVANCES RAISED BY THE ASSESSEE ARE AS FOLLOWS: 1. IN LAW AND IN FACTS AND CIRCUMSTANCES OF THE APPELLANT'S CASE, THE LEARNED COMMISSIONER OF INCOME - TAX (APPEALS) HAS ERRED IN POINTS OF LAW AND FACTS. 2. IN LAW AND IN FACTS AND CIRCUMSTANCES OF THE APPELLANT'S CASE, THE LEARNED COMMISSIONER OF INCOME - TAX (APPEALS) HAS GROSSLY ERRED IN CONFIRMING INTEREST ON LATE PAYMENT OF T.D.S. FOR RS.28,688 IN THE INTIMATION PASSED U/S. 154 R.W.S. 200A OF I.T. ACT. I.T.A. NO. 553 /AHD/201 5 ASSESSMENT YEAR: 20 13 - 14 PAGE 2 OF 6 3. IN LAW AND IN FACTS AND CIRCUMSTANCES OF THE APPELLANT'S CASE, THE LEARNED COMMISSIONER OF INCOME - TAX (APPEALS) HAS GROSSLY ERRED IN CONFIRMING INTEREST ON LATE DEDUCTION/COLLECTION FOR RS.4,629 I N THE INTIMATION PASSED U/S. 154 R.W.S. 200A OF I.T. ACT. 4. IN LAW AND IN FACTS AND CIRCUMSTANCES OF THE APPELLANT'S CASE, THE LEARNED COMMISSIONER OF INCOME - TAX (APPEALS) HAS GROSSLY ERRED IN CONFIRMING LEVYING RS.7,600 FOR LATE FILING, IN THE INTIMATIO N PASSED U/S. 154 R.W.S. 200A OF I.T. ACT. 5. IN LAW AND IN FACTS AND CIRCUMSTANCES OF THE APPELLANT'S CASE, THE LEARNED COMMISSIONER OF INCOME - TAX (APPEALS) HAS GROSSLY ERRED IN CONFIRMING CHARGING INTEREST FOR RS.5,792 U/S.220(2) OF I.T. ACT. 3 . WE HAVE HEARD THE RIVAL CONTENTIONS, PERUSED THE MATERIAL ON RECORD AND DULY CONSIDERED FACTS OF THE CASE IN THE LIGHT OF THE APPLICABLE LEGAL POSITION 4. WE WILL TAKE UP GROUND NO. 4 FIRST. SO FAR AS GROUND NO. 4, I.E. REGARDING LATE FILING FEE UNDER S ECTION 234E , IS CONCERNED, LEARNED REPRESENTATIVES FAIRLY AGREE THAT THE ISSUE IS COVERED, IN FAVOUR OF THE ASSESSEE, BY A COORDINATE BENCH DECISION IN THE CASE OF SIBIA HEALTHCARE PVT . LTD . VS . ACIT [(2015) 46 ITR (TRIB) 453 (ASR)] WHEREIN THE COORDINATE BENCH HAS, INTER ALIA, OBSERVED AS FOLLOWS: 5. WE MAY PRODUCE, FOR READY REFERENCE, SECTION 234E OF THE ACT, WHICH WAS INSERTED BY THE FINANCE ACT 2012 AND WAS BROUGHT INTO EFFECT FROM 1ST JULY 2012. THIS STATUTORY PROVISION IS AS FOLLOWS: '234E. FEE FO R DEFAULTS IN FURNISHING STATEMENTS (1) WITHOUT PREJUDICE TO THE PROVISIONS OF THE ACT, WHERE A PERSON FAILS TO DELIVER OR CAUSE TO BE DELIVERED A STATEMENT WITHIN THE TIME PRESCRIBED IN SUB - SECTION (3) OF SECTION 200 OR THE PROVISO TO SUB - SECTION (3) OF SECTION 206C, HE SHALL BE LIABLE TO PAY, BY WAY OF FEE, A SUM OF TWO HUNDRED RUPEES FOR EVERY DAY DURING WHICH THE FAILURE CONTINUES. (2) THE AMOUNT OF FEE REFERRED TO IN SUB - SECTION (1) SHALL NOT EXCEED THE AMOUNT OF TAX DEDUCTIBLE OR COLLECTIBLE, AS THE CASE MAY BE. (3) THE AMOUNT OF FEE REFERRED TO IN SUB - SECTION (1) SHALL BE PAID BEFORE DELIVERING OR CAUSING TO BE DELIVERED A STATEMENT IN ACCORDANCE WITH SUB - SECTION (3) OF SECTION 200 OR THE PROVISO TO SUB - SECTION (3) OF SECTION 206C. I.T.A. NO. 553 /AHD/201 5 ASSESSMENT YEAR: 20 13 - 14 PAGE 3 OF 6 (4) THE PROVISI ONS OF THIS SECTION SHALL APPLY TO A STATEMENT REFERRED TO IN SUB - SECTION (3) OF SECTION 200 OR THE PROVISO TO SUB - SECTION (3) OF SECTION 206C WHICH IS TO BE DELIVERED OR CAUSED TO BE DELIVERED FOR TAX DEDUCTED AT SOURCE OR TAX COLLECTED AT SOURCE, AS THE CASE MAY BE, ON OR AFTER THE 1ST DAY OF JULY, 2012 6. WE MAY ALSO REPRODUCE THE SECTION 200A WHICH WAS INSERTED BY THE FINANCE ACT 2009 WITH EFFECT FROM 1ST APRIL 2010. THIS STATUTORY PROVISION, AS IT STOOD AT THE RELEVANT POINT OF TIME, WAS AS FOLLOWS: '200A: PROCESSING OF STATEMENTS OF TAX DEDUCTED AT SOURCE (1) WHERE A STATEMENT OF TAX DEDUCTION AT SOURCE, OR A CORRECTION STATEMENT, HAS BEEN MADE BY A PERSON DEDUCTING ANY SUM (HEREAFTER REFERRED TO IN THIS SECTION AS DEDUCTOR) UNDER SECTION 200, SUCH STATEMENT SHALL BE PROCESSED IN THE FOLLOWING MANNER, NAMELY: - (A) THE SUMS DEDUCTIBLE UNDER THIS CHAPTER SHALL BE COMPUTED AFTER MAKING THE FOLLOWING ADJUSTMENTS, NAMELY: (I) ANY ARITHMETICAL ERROR IN THE STATEMENT; OR (II) AN INCORRECT CLAIM, APPAREN T FROM ANY INFORMATION IN THE STATEMENT; (B) THE INTEREST, IF ANY, SHALL BE COMPUTED ON THE BASIS OF THE SUMS DEDUCTIBLE AS COMPUTED IN THE STATEMENT; (C) THE SUM PAYABLE BY, OR THE AMOUNT OF REFUND DUE TO, THE DEDUCTOR SHALL BE DETERMINED AFTER ADJUSTME NT OF AMOUNT COMPUTED UNDER CLAUSE (B) AGAINST ANY AMOUNT PAID UNDER SECTION 200 AND SECTION 201, AND ANY AMOUNT PAID OTHERWISE BY WAY OF TAX OR INTEREST; (D) AN INTIMATION SHALL BE PREPARED OR GENERATED AND SENT TO THE DEDUCTOR SPECIFYING THE SUM DETERMI NED TO BE PAYABLE BY, OR THE AMOUNT OF REFUND DUE TO, HIM UNDER CLAUSE (C); AND (E) THE AMOUNT OF REFUND DUE TO THE DEDUCTOR IN PURSUANCE OF THE DETERMINATION UNDER CLAUSE (C) SHALL BE GRANTED TO THE DEDUCTOR: PROVIDED THAT NO INTIMATION UNDER THIS SUB - S ECTION SHALL BE SENT AFTER THE EXPIRY OF ONE YEAR FROM THE END OF THE FINANCIAL YEAR IN WHICH THE STATEMENT IS FILED. EXPLANATION : FOR THE PURPOSES OF THIS SUB - SECTION, 'AN INCORRECT CLAIM APPARENT FROM ANY INFORMATION IN THE STATEMENT' SHALL MEAN A CLAI M, ON THE BASIS OF AN ENTRY, IN THE STATEMENT - (I) OF AN ITEM, WHICH IS INCONSISTENT WITH ANOTHER ENTRY OF THE SAME OR SOME OTHER ITEM IN SUCH STATEMENT; (II) IN RESPECT OF RATE OF DEDUCTION OF TAX AT SOURCE, WHERE SUCH RATE IS NOT IN ACCORDANCE WITH TH E PROVISIONS OF THIS ACT; I.T.A. NO. 553 /AHD/201 5 ASSESSMENT YEAR: 20 13 - 14 PAGE 4 OF 6 (2) FOR THE PURPOSES OF PROCESSING OF STATEMENTS UNDER SUB - SECTION (1), THE BOARD MAY MAKE A SCHEME FOR CENTRALISED PROCESSING OF STATEMENTS OF TAX DEDUCTED AT SOURCE TO EXPEDITIOUSLY DETERMINE THE TAX PAYABLE BY, OR THE REFUND D UE TO, THE DEDUCTOR AS REQUIRED UNDER THE SAID SUB - SECTION.' 7. BY WAY OF FINANCE ACT 2015, AND WITH EFFECT FROM 1ST JUNE 2015, THERE IS AN AMENDMENT IN SECTION 200A AND THIS AMENDMENT, AS STATED IN THE FINANCE ACT 2015, IS AS FOLLOWS: 'IN SECTION 200A O F THE INCOME - TAX ACT, IN SUB - SECTION (1), FOR CLAUSES (C) TO (E), THE FOLLOWING CLAUSES SHALL BE SUBSTITUTED WITH EFFECT FROM THE 1ST DAY OF JUNE, 2015, NAMELY: - '(C) THE FEE, IF ANY, SHALL BE COMPUTED IN ACCORDANCE WITH THE PROVISIONS OF SECTION 234E; ( D) THE SUM PAYABLE BY, OR THE AMOUNT OF REFUND DUE TO, THE DEDUCTOR SHALL BE DETERMINED AFTER ADJUSTMENT OF THE AMOUNT COMPUTED UNDER CLAUSE (B) AND CLAUSE (C) AGAINST ANY AMOUNT PAID UNDER SECTION 200 OR SECTION 201 OR SECTION 234E AND ANY AMOUNT PAID OTH ERWISE BY WAY OF TAX OR INTEREST OR FEE; (E) AN INTIMATION SHALL BE PREPARED OR GENERATED AND SENT TO THE DEDUCTOR SPECIFYING THE SUM DETERMINED TO BE PAYABLE BY, OR THE AMOUNT OF REFUND DUE TO, HIM UNDER CLAUSE (D); AND (F) THE AMOUNT OF REFUND DUE TO T HE DEDUCTOR IN PURSUANCE OF THE DETERMINATION UNDER CLAUSE (D) SHALL BE GRANTED TO THE DEDUCTOR.' 8. IN EFFECT THUS, POST 1ST JUNE 2015, IN THE COURSE OF PROCESSING OF A TDS STATEMENT AND ISSUANCE OF INTIMATION UNDER SECTION 200A IN RESPECT THEREOF, AN AD JUSTMENT COULD ALSO BE MADE IN RESPECT OF THE 'FEE, IF ANY, SHALL BE COMPUTED IN ACCORDANCE WITH THE PROVISIONS OF SECTION 234E'. THERE IS NO DISPUTE THAT WHAT IS IMPUGNED IN APPEAL BEFORE US IS THE INTIMATION UNDER SECTION 200A OF THE ACT, AS STATED IN SO MANY WORDS IN THE IMPUGNED INTIMATION ITSELF, AND, AS THE LAW STOOD, PRIOR TO 1ST JUNE 2015, THERE WAS NO ENABLING PROVISION THEREIN FOR RAISING A DEMAND IN RESPECT OF LEVY OF FEES UNDER SECTION 234E. WHILE EXAMINING THE CORRECTNESS OF THE INTIMATION UNDE R SECTION 200A, WE HAVE TO BE GUIDED BY THE LIMITED MANDATE OF SECTION 200A, WHICH, AT THE RELEVANT POINT OF TIME, PERMITTED COMPUTATION OF AMOUNT RECOVERABLE FROM, OR PAYABLE TO, THE TAX DEDUCTOR AFTER MAKING THE FOLLOWING ADJUSTMENTS: (A), AFTER MAKING ADJUSTMENT ON ACCOUNT OF 'ARITHMETICAL ERRORS' AND 'INCORRECT CLAIMS APPARENT FROM ANY INFORMATION IN HESTATEMENT' - SECTION 200A(1)(A) (B). AFTER MAKING ADJUSTMENT FOR 'INTEREST, IF ANY, COMPUTED ON THE BASIS OF SUMS DEDUCTIBLE AS COMPUTED IN THE STATEM ENT'. I.T.A. NO. 553 /AHD/201 5 ASSESSMENT YEAR: 20 13 - 14 PAGE 5 OF 6 - SECTION 200A(1)(B) 9. NO OTHER ADJUSTMENTS IN THE AMOUNT REFUNDABLE TO, OR RECOVERABLE FROM, THE TAX DEDUCTOR, WERE PERMISSIBLE IN ACCORDANCE WITH THE LAW AS IT EXISTED AT THAT POINT OF TIME. 10. IN VIEW OF THE ABOVE DISCUSSIONS, IN OUR CONSIDER ED VIEW, THE ADJUSTMENT IN RESPECT OF LEVY OF FEES UNDER SECTION 234E WAS INDEED BEYOND THE SCOPE OF PERMISSIBLE ADJUSTMENTS CONTEMPLATED UNDER SECTION 200A. THIS INTIMATION IS AN APPEALABLE ORDER UNDER SECTION 246A(A), AND, THEREFORE, THE CIT(A) OUGHT TO HAVE EXAMINED LEGALITY OF THE ADJUSTMENT MADE UNDER THIS INTIMATION IN THE LIGHT OF THE SCOPE OF THE SECTION 200A. LEARNED CIT(A) HAS NOT DONE SO. HE HAS JUSTIFIED THE LEVY OF FEES ON THE BASIS OF THE PROVISIONS OF SECTION 234E. THAT IS NOT THE ISSUE HERE. THE ISSUE IS WHETHER SUCH A LEVY COULD BE EFFECTED IN THE COURSE OF INTIMATION UNDER SECTION 200A. THE ANSWER IS CLEARLY IN NEGATIVE. NO OTHER PROVISION ENABLING A DEMAND IN RESPECT OF THIS LEVY HAS BEEN POINTED OUT TO US AND IT IS THUS AN ADMITTED POSITI ON THAT IN THE ABSENCE OF THE ENABLING PROVISION UNDER SECTION 200A, NO SUCH LEVY COULD BE EFFECTED. AS INTIMATION UNDER SECTION 200A, RAISING A DEMAND OR DIRECTING A REFUND TO THE TAX DEDUCTOR, CAN ONLY BE PASSED WITHIN ONE YEAR FROM THE END OF THE FINANC IAL YEAR WITHIN WHICH THE RELATED TDS STATEMENT IS FILED, AND AS THE RELATED TDS STATEMENT WAS FILED ON 19TH FEBRUARY 2014, SUCH A LEVY COULD ONLY HAVE BEEN MADE AT BEST WITHIN 31ST MARCH 2015. THAT TIME HAS ALREADY ELAPSED AND THE DEFECT IS THUS NOT CURAB LE EVEN AT THIS STAGE. IN VIEW OF THESE DISCUSSIONS, AS ALSO BEARING IN MIND ENTIRETY OF THE CASE, THE IMPUGNED LEVY OF FEES UNDER SECTION 234 E IS UNSUSTAINABLE IN LAW. WE, THEREFORE, UPHOLD THE GRIEVANCE OF THE ASSESSEE AND DELETE THE IMPUGNED LEVY OF FE E UNDER SECTION 234E OF THE ACT. THE ASSESSEE GETS THE RELIEF ACCORDINGLY. 5. GROUND NO. 4 IS THUS ALLOWED. 6. SO FAR AS THE REMAINING GROUNDS OF APPEAL ARE CONCERNED, THESE ARE FACTUAL ISSUES AND THERE IS NO ADJUDICATION ON THESE ISSUES BY THE CIT(A). IT IS IMPORTANT TO NOTE THAT IN THE PRESENT CASE THE CIT(A) HAS DISMISSED THE APPEAL AS INFRUCTUOUS ON THE GROUND THAT, AS A RESULT OF RECTIFICATION ORDER UNDER SECTION 154, THE DEMAND IS SUBSTANTIALLY REDUCED AND THE ASSESSEE SHOULD FILE A FRESH APPEAL A GAINST THE REVISED ORDER. THE CIT(A) HAS, IN THE PENULTIMATE PARAGRAPH OF THE ORDER, OBSERVED AS FOLLOWS: IT IS SUBMITTED BY THE APPELLANT THAT ON FILING COLLECTION A STATEMENT SUBSEQUENTLY THE DEMAND IS REDUCED SUBSTANTIALLY AND FROM 241090 IT HAS COME DOWN TO 46710. THU S IT IS SEEN THAT THE ORDER APPEALED AGAINST HAS LOST ITS IDENTITY ON MERGER WITH THE FRESH ORDER PASSED ON FILING OF CORRECTION STATEMENT BY THE I.T.A. NO. 553 /AHD/201 5 ASSESSMENT YEAR: 20 13 - 14 PAGE 6 OF 6 APPELLANT. WITH THE RESULT THIS APPEAL HAS BECOME INFRUCTUOUS, SINCE IF THE APPELLANT HAS GOT ANY GRIEVANCE AG AINST THE REVISED ORDER, THE APPEAL IS TO BE SEPARATELY FILED. 7. IN OUR CONSIDERED VIEW, HOWEVER, JUST BECAUSE AN ORDER IS SUBSEQUENTLY MODIFIED BY RECTIFYING THE SAME UNDER SECTION 154, THE APPEAL AGAINST THAT ORDER IS NOT RENDERED INFRUCTUOUS. TO THE EXTENT THE RELIEF IN THE RECTIFICATION PROCEEDINGS, THOSE GRIEVANCES IN APPEAL ARE RENDERED INFRUCTUOUS AND NEED NOT, THEREFORE, BE DEALT ON MERITS. HOWEVER, THE APPEAL ITSELF CANNOT BE DISMISSED AS INFRUCTUOUS, WE, THEREFORE, DEEM IT AND FIT AND PROPER TO REMIT THE MATTER TO THE FILE OF THE CIT(A) FOR ADJUDICATION, ON MERITS, ON THE GRIEVANCES RAISED BEFORE HIM IN RESPECT OF THESE GROUNDS OF APPEAL. ORDERED ACCORDINGLY. 8. GROUND NOS. 2, 3 AND 5 ARE, THEREFORE, ALLOWED FOR THE STATISTICAL PURPOSES IN THE T ERMS INDICATED ABOVE . GROUND NO. 1 AND 5 ARE GENERAL IN NATURE AND DO NOT CALL FOR ANY ADJUDICATION. 9. IN THE RESULT, THE APPEAL IS PARTLY A LLOWED IN THE TERMS INDICATED A BOVE. PRONOUNCED IN THE OPEN COURT TODAY ON 27 TH DAY OF OCTOBER , 2016. SD/ - SD/ - R.P. TOLANI PRAMOD KUMAR (JUDICIAL MEMBER) (ACCOUNTANT MEMBER) DATED: 27 TH DAY OF OCTOBER , 2016. COPIES TO: (1) THE APPELLANT (2) THE RESPONDENT (3) COMMISSIONER (4) CIT(A) (5) DEPARTME NTAL REPRESENTATIVE (6) GUARD FILE BY ORDER ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCHES, AHMEDABAD