Bhim Sain & Sons, New Delhi V. ITO, Ward-63(3), New Delhi

ITA 5553/DEL/2017

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 3900 (ITAT-DELHI)
• Duration Of Justice: 4 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-01-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2013-2014
• Appeal Filed On: 31-08-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ASHIMA NEB
• Section: 201(1)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI SMC BENCH, NEW DELHI BEFORE SHRI B.P. JAIN, ACCOUNTANT MEMBER ITA NO. 5553 /DEL/201 7 [A.Y. 20 13 - 14 ] BHIM SAIN & SONS VS. ITO, WARD - 63(3) 1052, PAN MANDI, NEW DELHI SA DAR BAZAR, NEW DELHI PAN : AAAFB5553D [ ASSESSEE ] [RESPONDENT] DATE OF HEARING : 2 6 . 1 2 .2017 DATE OF PRONOUNCEMENT : 08 .01 .201 8 ASSESSEE BY : SHRI M.P .RASTOGI, ADV. REVENUE BY : MS. ASHIMA NEB, SR. DR ORDER THIS APPEAL OF THE ASSESSEE ARISES FROM THE ORDER OF THE LD. CIT(A) - 20 , NEW DELHI VIDE ORDER DATED 1 8 .0 7 .201 7 FOR A.Y. 20 13 - 14 . 2 . THE ASSESSEE HAS RAI SED THE FOLLOWING GROUND S OF APPEAL: 1. THAT THE APPELLANT IS NOT AN ASSESSEE IN DEFAULT IN TERMS OF THE FIRST PROVISO TO SECTION 201 READ WITH THE SECOND PROVISO TO SECTION 40(IA) OF THE INCOME TAX ACT, 1961 AND CONSEQUENTLY THE DISALLOWANCE OF RS. 1,5 5,259/ - BEING THE AMOUNT PAID AS INTEREST TO M/S BHIM SAIN & SONS (HUF), IS ARBITRARY, UNJUST AND BAD IN LAW. 2 ITA NO. 5553 /DEL/201 7 2. THAT IN THE ABSENCE OF ANY REASONING GIVEN BY CIT(APPEALS) IN HIS ORDER, THE ADDITION OF RS. 1,55,259/ - , BEING THE INTEREST PAID TO M/S BHIM SA IN & SONS (HUF) U/S 40(IA) OF THE ACT IS ARBITRARY, UNJUST AND BAD IN LAW. 3. THAT THE ABOVE GROUNDS OF APPEAL ARE INDEPENDENT AND WITHOUT PREJUDICE TO ONE ANOTHER. 3 . BRIEFLY STATED, THE FACTS OF THE CASE ARE THAT THE ASSESSEE - FIRM HAS PAID INTERE ST AMOUNTING TO RS. 1,57,258.85 ON WHICH NO TDS WAS DEDUCTED BY THE ASSESSEE FIRM AS THE PAYEE SHRI BHIM SAIN HAS NOT INCOME EXCEPT INTEREST RECEIVED FROM THE FIRM WHICH IS BELOW THE TAXABLE LIMIT AS HAS BEEN STATED. THE EXPLANATION GIVEN BY THE ASSESSEE WAS NOT ACCEPTED BY THE ASSESSING OFFICER AND ACCORDINGLY MADE THE ADDITION WHICH WAS CONFIRMED BY THE LD. CIT(A). 3. I HAVE CONSIDERED THE RIVAL ARGUMENTS MADE BY BOTH THE SIDES, PERUSED THE ORDERS OF THE A.O AND THE LD. CIT(A) AS ALSO THE RELEVANT M ATERIAL AVAILABLE ON RECORD. THERE IS NO DISPUTE TO THE FACT THAT SHRI DILIP KUMAR MADAN IS ALSO K ARTA OF THE HUF BHIM SAIN AND HAS SI G N ED AND GIVEN DECLARATION IN FORM 15G IN PART 1. AT THE SAME TIME, HE HAS SIGNED THE COPY OF FORM 15G IN PART II ALSO I N THE CAPACITY OF THE PARTNER OF THE FIRM M/S BHIM SAIN & SONS I.E. THE ASSESSEE. AS PER 3 ITA NO. 5553 /DEL/201 7 SECTION 194A OF THE INCOME - TAX ACT, 1961 [HEREINAFTER REFERRED TO AS 'THE ACT' FOR SHORT], THE ASSESSEE IS REQUIRED TO DEDUCT TAX AT SOURCE WHICH HAS NOT BEEN DISPUTE D BY THE LD. COUNSEL FOR THE ASSESSEE . B UT AT THE SAME TIME, FORM 15G HAS BEEN FILED AND PLACED ON RECORD AND IT HAS BEEN ARGUED THAT THE SAID HUF HAVING DECLARED THE SAID INCOME IN ITS RETURN OF INCOME FOR THE IMPUGNED YEAR, THE ASSESSEE CANNOT BE HELD TO BE AS ASSESSEE IN DEFAULT. THE RELEVANT PROVISO TO SECTION 20 1 (1) ARE REPRODUCED HEREINBELOW: PROVIDED THAT A NY PERSON INCLUDING THE PRINCIPAL OFFICER OF A WHO FAILS TO DEDUCT THE WHOLE OR ANY PART OF THE TA X IN ACCORDANCE WITH THE PROVISIONS OF THIS CHAPTER ON THE SUM PAID TO A RESIDENT OR ON THE SUM CREDITED TO THE ACCOUNT OF A RESIDENT SHALL NOT BE DEEMED TO BE AN ASSESSEE IN DEFAULT IN RESPECT OF SUCH TAX IF SUCH RESIDENT I) HAS FURNISHED HIS RETURN OF INCOME U/S 139; II) HAS TAKEN INTO AC COUNT SUCH SUM FOR COMPUTING INCOME IN ANY SUCH RETURN OF INCOME; AND III) HAS PAID THE TAX DUE ON THE INCOME DECLARED BY HIM IN SUCH RETURN OF INCOME. 4 ITA NO. 5553 /DEL/201 7 4. THEREFORE, AS PER THE PROVISIONS OF SECTION 40(A)(IA) AND 201(1) OF THE ACT, WHERE TAX HAS NOT BE E N DEDUCTED AND HAS BEEN PAID BY THE PAYEE HAS TO BE VERIFIED BY THE ASSESSING OFFICER WHICH HAS NOT BEEN DONE IN THE PRESENT CASE. THEREFORE, IN THE FACTS AND CIRCUMSTANCES OF THE CASE, THE MATTER IS SET ASIDE TO THE FILE OF THE ASSESSING OFFICER WHO WILL VERIFY WHETHER THE SAID SUM HAS BEEN INCLUDED IN THE RETURN OF INCOME OF THE PAYEE, THE SAID HUF. ACCORDINGLY, THE GROUNDS RAISED BY THE ASSESSEE ARE ALLOWED FOR STATISTICAL PURPOSES. 5. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED FOR STATI STICAL PURPOSES. THE ORDER IS PRO NOUNCED IN THE OPEN COURT ON 08 . 0 1 .201 8 . SD/ - [B.P. JAIN] ACCOUNTANT MEMBER DATED: 08 TH JANUARY 2018 VL/ COPY FORWARDED TO: 1 . ASSESSEE 2 . RESPOND ENT 3 . CIT ASSISTANT REGISTRAR 4 . CIT(A) ITAT, NEW DELHI 5 . DR