DCIT, CHENNAI V. Prakash Gold Palace Pvt Ltd., CHENNAI

ITA 585/CHNY/2014

• Counselvise Citation: [2014] 120 COUNSELVISE.COM (IT) 6313 (ITAT-CHENNAI)
• Duration Of Justice: 3 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-06-2014
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2008-2009
• Appeal Filed On: 10-03-2014
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: V SRINIVASAN ITP
• Keywords: Additional evidence

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL , A B ENCH, CHENNAI . , ! # $ , % & BEFORE SHRI A.MOHAN ALANKAMONY ACCOUNTANT MEMBER AND SHRI CHALLA NAGENDRA PRASAD, JUDICIAL MEMBER ./I.T.A.NO. 585/MDS/2014 ( / ASSESSMENT YEAR: 2008-09) DEPUTY COMMISSIONER OF INCOME TAX, COMPANY CIRCLE-V(2), MAIN BUILDING, 4 TH FLOOR, 121 M.G.ROAD, CHENNAI-600 034. VS M/S. PRAKASH GOLD PALACE PVT. LTD., 144, PURASAWALKKAM HIGH ROAD, CHENNAI-600 010. PAN: AACCA4384Q ( /APPELLANT) ( /RESPONDENT) / APPELLANT BY : MR. SHAJI P.JACOB, ADDL. CIT /RESPONDENT BY : MR. V.SRINIVASAN, ITP / DATE OF HEARING : 7 TH MAY, 2014 /DATE OF PRONOUNCEMENT : 20 TH JUNE, 2014 / O R D E R PER CHALLA NAGENDRA PRASAD, JM: THIS APPEAL IS FILED BY THE REVENUE AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS)-V, CHEN NAI DATED 25.11.2013 FOR THE ASSESSMENT YEAR 2008-09. 2. THE ONLY GRIEVANCE OF THE REVENUE IN THIS APPEAL IS THAT COMMISSIONER OF INCOME TAX (APPEALS) ERRED IN DELET ING THE DISALLOWANCE UNDER SECTION 40(A)(IA) OF THE ACT IN RESPECT OF PAYMENTS MADE TO VARIOUS GOLDSMITHS AT ` 13.98 LAKHS AS NO 2 ITA NO. 585/MDS/2014 TDS WAS DEDUCTED. THE ASSESSING OFFICER WHILE COM PLETING THE ASSESSMENT DISALLOWED ` 15,09,694/- UNDER SECTION 40(A)(IA) OF THE ACT HOLDING THAT ASSESSEE HAS NOT DEDUCTED TAX AT SOURCE ON THE PAYMENT OF ` 15,09,694/-. THE ASSESSEE PREFERRED AN APPEAL BEFORE THE COMMISSIONER OF INCO ME TAX (APPEALS) AND SUBMITTED THAT ASSESSEE MADE TDS ON C ERTAIN AMOUNTS PAID TOWARDS PROFESSIONAL CHARGES. THE ASSE SSEE SUBMITTED THAT OUT OF ` 15,09,694/- AN AMOUNT OF ` 13,98,125/- WAS PAID TO VARIOUS PERSONS FOR CARRYIN G OUT ORNAMENT / JEWELLERY MAKING CHARGES IN THE COTTAGE INDUSTRY. IT WAS THE SUBMISSION OF THE ASSESSEE THAT ` 13,98,125/- WAS PAID TO NUMBER OF GOLDSMITHS WHO WERE REGULARLY EMP LOYED BY THE ASSESSEE FOR MAKING GOLD ORNAMENTS. IT WAS S UBMITTED THAT IN RESPECT OF ALL SUCH GOLDSMITHS EMPLOYED BY THE ASSESSEE EITHER INDIVIDUAL GROSS WAGES ITSELF WERE BELOW THE THRESHOLD LIMIT FOR DEDUCTION OF TAX UNDER SECTION 192 OF THE ACT OR TAXABLE INCOME AFTER DEDUCTING STATUTORY ALL OWABLE DEDUCTIONS DID NOT EXCEED THE MAXIMUM LIMIT NOT CH ARGEABLE TO TAX. THEREFORE, ASSESSEE SUBMITTED THAT THESE P AYMENTS ARE NOT LIABLE TO DEDUCT TDS AND THEREFORE PROVISI ONS OF 3 ITA NO. 585/MDS/2014 SECTION 40(A)(IA) OF THE ACT ARE NOT ATTRACTED. TH E SUBMISSION OF THE ASSESSEE WAS ACCEPTED BY THE COMMISSIONER OF INCOME TAX (APPEALS) WITH REFERENCE TO THE RECORDS AND THE DETAILS FURNISHED IN THE COURSE OF APPELLATE PROCEE DINGS BEFORE HIM AND THUS DELETED THE DISALLOWANCE MADE U NDER SECTION 40(A)(IA) OF THE ACT. THE REVENUE IS IN AP PEAL BEFORE US AGAINST DELETION OF DISALLOWANCE MADE TO THE EXT ENT OF ` 13,98,125/- REPRESENTING WAGES PAID TO GOLDSMITHS. 3. DEPARTMENTAL REPRESENTATIVE SUBMITS THAT COMMISSIONER OF INCOME TAX (APPEALS) ACCEPTED THE CONTENTIONS OF THE ASSESSEE THAT ALL THESE ARE PAID TO GOLDSMITHS AS WAGES AND THEY ARE ALL REGULAR EMPLO YEES AND NONE OF THE INDIVIDUAL GOLDSMITH HAS BEEN PAID WAGE S EXCEEDING MAXIMUM AMOUNT WARRANTING THE ASSESSEE TO DEDUCT TAX AT SOURCE. DEPARTMENTAL REPRESENTATIVE S UBMITS THAT SUBMISSION OF THE ASSESSEE WAS ACCEPTED BY THE COMMISSIONER OF INCOME TAX (APPEALS) WITH REFERENCE TO THE ADDITIONAL EVIDENCE PLACED BEFORE HIM BY THE ASSES SEE IN THE FORM OF RECORDS AND THE DETAILS WERE FURNISHED FOR THE FIRST 4 ITA NO. 585/MDS/2014 TIME BEFORE HIM AND WITHOUT GIVING ANY OPPORTUNITY TO THE ASSESSING OFFICER OR CALLING FOR ANY REMAND REPORT FROM THE ASSESSING OFFICER. THEREFORE, DEPARTMENTAL REPRESEN TATIVE SUBMITS THAT THERE IS A VIOLATION OF RULE 46A AS NO OPPORTUNITY WAS PROVIDED TO THE ASSESSING OFFICER. DEPARTMENTAL REPRESENTATIVE SUBMITS THAT MATTER MAY BE SENT BACK TO THE ASSESSING OFFICER FOR VERIFICATION OF THE SUBMISSIO NS MADE BY THE ASSESSEE. 4. COUNSEL FOR THE ASSESSEE HAS NO SERIOUS OBJECTIO N IN REMANDING THE MATTER TO THE FILE OF THE ASSESSING O FFICER FOR THE PURPOSE OF VERIFICATION OF THE SUBMISSIONS WITH REFERENCE TO THE DETAILS FURNISHED BY HIM BEFORE THE COMMISSI ONER OF INCOME TAX (APPEALS). 5. HEARD BOTH SIDES. PERUSED ORDERS OF LOWER AUTHOR ITIES. WE REMAND THE ISSUE BACK TO THE FILE OF THE ASSESSI NG OFFICER TO EXAMINE THE ISSUE WITH REFERENCE TO THE SUBMISSI ONS OF THE ASSESSEE AND THE DETAILS FURNISHED BEFORE THE COMMI SSIONER OF INCOME TAX (APPEALS) AND DECIDE THE ISSUE IN ACC ORDANCE 5 ITA NO. 585/MDS/2014 WITH LAW, AFTER PROVIDING ADEQUATE OPPORTUNITY TO T HE ASSESSEE. 6. IN THE RESULT, APPEAL OF THE REVENUE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON FRIDAY THE 20 TH DAY OF JUNE, 2014 AT CHENNAI. SD/- SD/- ( A.MOHAN ALANKAMONY ) ( CHALLA NAGEND RA PRASAD ) . ( ' )* ) ACCOUNTANT MEMBER / , JUDICIAL MEMBER/ ) , ) /CHENNAI, - /DATED, 20 TH JUNE, 2014 SOMU /0 10 /COPY TO: 1. APPELLANT 2. /RESPONDENT 3. 2 () /CIT(A) 4. 2 /CIT 5. 0 6 /DR 6. /GF .