Canara Bank, Ambala V. ITO (TDS), Panchkula

ITA 609/CHANDI/2012

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 64121 (ITAT-CHANDIGARH)
• Duration Of Justice: 6 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-12-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 20-12-2012
• Assessment Year: 2006-2007
• Appeal Filed On: 31-05-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL CHANDIGARH BENCH B, CHANDIGARH BEFORE SHRI T.R. SOOD, ACCOUNTANT MEMBER AND MS. SUSHMA CHOWLA, JUDICIAL MEMBER ITA NOS.609 TO 611 /CHD/2012 (ASSESSMENT YEARS: 2006-07 & 2009-10) CANARA BANK, VS. THE INCOME TAX OFFICER(TDS), AMBALA. PANCHKULA. CHANDIGARH. PAN: RTKC01779B (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI H.K.JINDAL NONE RESPONDENT BY : SHRI AKHILESH GUPTA, DR DATE OF HEARING : 20.12.2012 DATE OF PRONOUNCEMENT : 28.12.2012 O R D E R PER SUSHMA CHOWLA, J.M. : THESE THREE APPEALS BY THE ASSESSEE ARE AGAINST TH E SEPARATE ORDERS OF THE COMMISSIONER OF INCOME TAX (APPEALS), ROHTAK , EACH DATED 16.03.2012 RELATING TO ASSESSMENT YEARS 2006-07 & 2 009-10 AGAINST THE PENALTY LEVIED U/S 272B OF INCOME TAX ACT, 1961 (IN SHORT THE ACT). 2. THE ONLY GROUND RAISED BY THE ASSESSEE IN ALL TH E THREE APPEALS READS AS UNDER: 1. THE LD. COMMISSIONER OF INCOME TAX APPEALS HAS ERRED IN LAW AND FACTS OF THE CASE WHILE UPHOLDING THE PENALTY OF RS.190000/-(RS.10,000/- IN ITA NO.610 & 611/CHD/2012) INSTEAD OF GIVING RELIEF AGAINST THE SAME. 4. ALL THE THREE APPEALS RELATING TO THE SAME ASSES SEE WERE HEARD TOGETHER AND ARE BEING DISPOSED OFF BY THIS CONSOLI DATED ORDER FOR THE SAKE OF CONVENIENCE. ITA NO.609/CHD/2012 5. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSE E HAD FILED E-TDS QUARTERLY STATEMENT ON 31.8.2005, IN WHICH PAN NUMB ERS OF 19 DEDUCTEES 2 WERE FOUND TO BE INVALID. THE ASSESSEE FAILED TO A PPEAR BEFORE THE ASSESSING OFFICER IN RESPONSE TO THE SHOW CAUSE NOT ICE ISSUED AND CONSEQUENTLY THE ASSESSING OFFICER LEVIED PENALTY A T RS.1,19,000/- UNDER SECTION 272B OF THE ACT. THE SAID LEVY OF PENALTY UNDER SECTION 272B OF THE ACT WAS CONFIRMED BY THE CIT (APPEALS) AS THE A SSESSEE FAILED TO BRING ON RECORD EVIDENCE TO ESTABLISH ITS PLEA OF R EASONABLE CAUSE. 6. THE ASSESSEE IS IN APPEAL BEFORE US AGAINST THE ORDER OF THE CIT (APPEALS). THE LEARNED A.R. FOR THE ASSESSEE RAISE D PLEA BEFORE US THAT NO PENALTY IS LEVIABLE UNDER SECTION 272B OF THE AC T FOR THE IMPUGNED ASSESSMENT YEAR AS THE PROVISIONS REQUIRING THE ASS ESSEE TO FURNISH THE PAN NUMBERS IN THE QUARTERLY STATEMENT OF RETURN FI LED, WAS INTRODUCED BY THE FINANCE ACT, 2006 W.E.F. 1.6.2006. 7. THE LEARNED D.R. FOR THE REVENUE PLACED RELIANCE ON THE ORDERS OF THE AUTHORITIES BELOW. 8. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE RECORD. THE ASSESSEE IS IN APPEAL AGAINST THE LEVY OF PENALTY U NDER SECTION 272B OF THE ACT RELATING TO ASSESSMENT YEAR 2006-07. THE A SSESSEE HAD FURNISHED E-TDS QUARTERLY STATEMENT FOR THE FINANCIAL YEAR 20 05-06 IN FORM NO.24Q ON 31.8.2005 IN WHICH PAN NUMBER OF NINETEEN TAX DEDUCTEES WERE FOUND TO BE INVALID. 9. THE FINANCE (NO.2) ACT, 2004 W.E.F. 1.4.2005 INS ERTED SUB-SECTION (3) TO SECTION 200 OF THE ACT WHICH READS AS UNDER: 200 (3) ANY PERSON DEDUCTING ANY SUM ON OR AFTER T HE 1ST DAY OF APRIL, 2005 IN ACCORDANCE WITH THE FOREGOING PROVISIONS OF THIS CHAPTER OR, AS THE CASE MAY BE, ANY PERSON BEING AN EMPLOYER REFER RED TO IN SUB-SECTION (1A) OF SECTION 192 SHALL, AFTER PAYING THE TAX DEDUCTED TO THE CREDIT OF THE CENTRAL GOVERNMENT WITHIN THE PRESCRIBED TIME, [ PREPARE SUCH STATEMENTS FOR SUCH PERIOD AS MAY BE PRESCRIBED ] , AND DELIVER OR CAUSE TO BE DELIVERED TO THE PRESCRIBED INCOME-TAX AUTHOR ITY OR THE PERSON AUTHORISED BY SUCH AUTHORITY SUCH STATEMENT IN SUCH FORM AND VERIFIED IN SUCH MANNER AND SETTING FORTH SUCH PARTICULARS AND WITHIN SUCH TIME AS MAY BE PRESCRIBED. 3 10. IN THE AMENDED PROVISIONS OF SECTION, THE ASSES SEE IS TO FURNISH QUARTERLY E-TDS RETURN IN RESPECT OF TAX DEDUCTED O UT OF SALARY UNDER THE PROVISIONS OF SECTION 192 OR ANY OTHER PAYMENT MADE UNDER CHAPTER- XVII. THE SAID PROVISIONS ARE APPLICABLE W.E.F. 1 ST DAY OF APRIL, 2005. PRIOR TO THE INSERTION OF SUB-SECTION (3) TO SECTIO N 200 OF THE ACT, THE ASSESSEE WAS TO FURNISH YEARLY STATEMENT OF TAX DED UCTION AT SOURCE IN THE RETURNS PRESCRIBED UNDER THE PROVISIONS OF SECT ION 206 OF THE ACT. 11. FURTHER IT IS THE DUTY OF THE DEDUCTOR TO QUOTE THE PERMANENT ACCOUNT NUMBER OF THE PERSON TO WHOM SUCH SUM OR IN COME OR AMOUNT HAD BEEN PAID AS PER SECTION 139A (5B) OF THE ACT. UNDER THE AFORESAID PROVISIONS OF SECTION THE DEDUCTOR HAS TO QUOTE THE PERMANENT ACCOUNT NUMBER OF THE DEDUCTEE I) IN THE STATEMENT FURNISHE D TO THE EMPLOYEE UNDER SECTION 192(2C) OF THE ACT; II) IN THE CERTIF ICATE OF TAX DEDUCTION AT SOURCE FURNISHED UNDER SECTION 203 OF THE ACT; I II) IN ALL THE RETURNS PREPARED/DELIVERED IN ACCORDANCE WITH THE PROVISION S OF SECTION 206 OF THE ACT, TO ANY INCOME-TAX AUTHORITY. FURTHER SUB- CLAUSE (IV) TO SUB- SECTION (5B) OF SECTION 139A OF THE ACT WAS INSERTE D BY THE FINANCE ACT, 2006 W.E.F. 1.6.2006. UNDER THE SAID SUB-CLAUSE TH E TAX DEDUCTED AT SOURCE HAS TO BE QUOTED BY THE DEDUCTOR IN ALL THE STATEMENTS PREPARED/DELIVERED IN ACCORDANCE WITH THE PROVISION S OF SECTION 200 (3) OF THE ACT. THE SAID PROVISION IS APPLICABLE W.E.F . 1.6.2006 AND IS TO APPLY FROM 1.6.2006. THE DEFAULT IN FURNISHING THE CORRECT PAN NUMBER IN THE VARIOUS STATEMENTS/CERTIFICATES TO BE FILED IN ACCORDANCE WITH THE PROVISIONS OF SECTION 139A(5B) OF THE ACT ATTRACTS LEVY OF PENALTY UPON THE DEDUCTOR UNDER SECTION 272B OF THE ACT. 12. IN THE FACTS AND CIRCUMSTANCES OF THE PRESENT C ASE BEFORE US, THE E- TDS QUARTERLY STATEMENT OF TAX DEDUCTED AT SOURCE I N FORM NO.24Q RELATING TO FINANCIAL YEAR 2005-06 WAS DUE AND FURN ISHED BY THE ASSESSEE ON 31.8.2005. IN VIEW OF THE INSERTION OF SUB-CLAU SE (IV) TO SECTION 139A(5B) OF THE ACT, THE DUTY OF THE DEDUCTOR TO QU OTE THE PAN NUMBER 4 STARTS FROM 1.6.2006 I.E. THE DATE OF INSERTION OF THE SAID SUB-CLAUSE BY WAY OF FINANCE ACT, 2006. ACCORDINGLY, THE ASSESSE E HAVING FURNISHED ITS E-TDS QUARTERLY STATEMENT ON 31.8.2005 CANNOT B E HELD TO HAVE DEFAULTED BY NON-FURNISHING OR WRONGLY MENTIONING T HE PAN NUMBER OF THE DEDUCTEE IN THE QUARTERLY STATEMENT FILED ON 31 .8.2005. IN VIEW THEREOF, THERE IS NO MERIT IN THE LEVY OF PENALTY U NDER SECTION 272B OF THE ACT. THUS WE HOLD THAT THERE IS NO MERIT IN TH E LEVY OF PENALTY AMOUNTING TO RS.1,19,000/- FOR THE CAPTIONED ASSESS MENT YEAR I.E. ASSESSMENT YEAR 2006-07. THE ASSESSING OFFICER IS DIRECTED TO DELETE THE PENALTY LEVIED UNDER SECTION 272B OF THE ACT AMOUNT ING TO RS.1,19,000/-. THE GROUND OF APPEAL RAISED BY THE ASSESSEE IS THUS ALLOWED. ITA NO.610/CHD/2012 13. THE FACTS RELATING TO THE CAPTIONED ASSESSMENT YEAR IS THAT ASSESSEE HAD FURNISHED E-TDS QUARTERLY STATEMENT IN FORM NO. 24Q FOR THE FINANCIAL YEAR 2008-09 ON 17.6.2009 AND HAD FAILED TO FURNISH THE PAN NUMBERS OF THREE DEDUCTEES. THE ASSESSEE FAILED TO RESPOND TO THE SHOW CAUSE NOTICE ISSUED BY THE ASSESSING OFFICER AND CO NSEQUENTLY PENALTY OF RS.30,000/- WAS LEVIED UNDER SECTION 272B OF THE AC T. THE CIT (APPEALS) CONFIRMED THE LEVY OF PENALTY UNDER SECTI ON 272B OF THE ACT AT RS.30,000/- AS THE ASSESSEE HAD FAILED TO FILE THE CORRECTION STATEMENT IN RESPECT OF THREE DEDUCTEES BEFORE THE ASSESSING OFF ICER OR BEFORE PASSING OF THE ORDER OF THE CIT (APPEALS) ALSO. IN VIEW TH EREOF THE ASSESSING OFFICER LEVIED PENALTY OF RS.30,000/-, WHICH WAS CO NFIRMED BY THE CIT (APPEALS). THE PROVISIONS OF SECTION 272B(1) OF TH E ACT PROVIDE THAT IF A PERSON FAILED TO COMPLY WITH THE PROVISION OF SEC TION 139A, THE ASSESSING OFFICER MAY DIRECT THAT SUCH PERSON SHALL PAY, BY WAY OF PENALTY A SUM OF RS.10,000/- . IN VIEW OF THE ABOVE SAID PROVISIONS OF THE ACT WE RESTRICT THE LEVY OF PENALTY UNDER SECTI ON 272B OF THE ACT AT RS.10,000/-. THUS GROUND OF APPEAL RAISED BY THE A SSESSEE IS PARTLY ALLOWED. 5 ITA NO.611/CHD/2012 14. THE FACTS RELATING TO THE PRESENT APPEAL ARE TH AT THE ASSESSEE HAD FURNISHED E-TDS QUARTERLY STATEMENT OF TAX DEDUCTED AT SOURCE RELATING TO FINANCIAL YEAR 2008-09 IN FORM NO.24Q ON 29.4.2009. THE PAN NUMBER OF ONE OF THE DEDUCTEES WAS NOT FURNISHED BY THE AS SESSEE AND HENCE THE ASSESSING OFFICER FOUND THE ASSESSEE TO HAVE DEFAUL TED. THUS THE ASSESSING OFFICER LEVIED PENALTY UNDER SECTION 272B OF THE ACT AT RS.10,000/-. THE SAID LEVY OF PENALTY UNDER SECTIO N 272B OF THE ACT AT RS.10,000/- WAS CONFIRMED BY THE CIT (APPEALS), AGA INST WHICH THE ASSESSEE IS IN APPEAL BEFORE US. 15. THE LEARNED A.R. FOR THE ASSESSEE RAISED A NEW PLEA BEFORE US THAT THE SALARY PAID TO THE EMPLOYEE WAS BELOW TAXABLE A ND HENCE THERE IS NO REQUIREMENT OF FURNISHING THE PAN NUMBER OF THE SAI D DEDUCTEE AS THE PERSON WAS NOT LIABLE TO APPLY FOR PAN NUMBER. 16. THE LEARNED D.R. FOR THE REVENUE PLACED RELIANC E ON THE ORDERS OF THE AUTHORITIES BELOW. 17. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE RECORD. THE PROVISION OF SECTION 272B OF THE ACT ARE ATTRACTED WHERE THE ASSESSEE HAS FAILED TO FURNISH THE PAN NUMBER OF THE DEDUCTEE IN THE STATEMENT FURNISHED IN RESPONSE TO TAX DEDUCTION AT SOURCE UN DER VARIOUS PROVISIONS OF THE ACT. THE LEARNED A.R. FOR THE ASSESSEE HAS RAISED A NEW PLEA THAT THE PERSON IN RESPECT OF WHICH IT WAS HELD TO BE IN DEFAULT IN NON- FURNISHING OF THE PAN NUMBER, HAD BELOW TAXABLE INC OME AND AS SUCH THERE WAS NO REQUIREMENT TO APPLY OR GET PAN NUMBER . THE SAID PROVISIONS OF SECTION 139A OF THE ACT ARE APPLICABL E TO THE PERSON IN RESPECT OF THE FIRST PREVIOUS YEAR IN WHICH THE INC OME EXCEEDS THE MAXIMUM AMOUNT WHICH IS NOT CHARGEABLE TO INCOME-TA X. IN CASE THE INCOME OF THE PERSON IS BELOW TAXABLE LIMIT, THERE IS NO REQUIREMENT TO APPLY FOR THE PAN. THE LEARNED A.R. FOR THE ASSESS EE HAS RAISED A NEW 6 PLEA BEFORE US THAT THE DEDUCTEE IN RESPECT OF WHOM THE PAN WAS NOT FURNISHED WAS NOT OBLIGED TO APPLY FOR THE PAN AS T HE SALARY PAID TO THE PERSON WAS BELOW TAXABLE LIMIT. THE SAID PLEA OF T HE ASSESSEE NEEDS VERIFICATION AND ACCORDINGLY WE REMIT THE ISSUE BAC K TO THE FILE OF THE ASSESSING OFFICER TO VERIFY THE STAND OF THE ASSESS EE. THE ASSESSING OFFICER IS TO DETERMINE THE TOTAL INCOME OF THE DED UCTEE FOR THE PREVIOUS YEAR FROM ALL SOURCES AND NOT ONLY THE SALARY RECEI VED BY THE DEDUCTEE FOR THE PERIOD UNDER CONSIDERATION. IN CASE THE SA ID INCOME OF THE DEDUCTEE IS BELOW TAXABLE LIMIT, THEN THERE IS NO R EQUIREMENT TO APPLY AND RECEIVE THE PAN AND IN SUCH CIRCUMSTANCES, THE DEDUCTOR ASSESSEE FOR NOT QUOTING THE PAN COULD NOT BE HELD TO HAVE D EFAULTED AND HENCE NOT EXIGIBLE TO LEVY OF PENALTY UNDER SECTION 272B OF THE ACT. THE ASSESSING OFFICER SHALL DECIDE THE ISSUE AFTER VERI FICATION AND IN ACCORDANCE WITH LAW. REASONABLE OPPORTUNITY OF HEA RING SHALL BE AFFORDED TO THE ASSESSEE. THE GROUNDS OF APPEAL RA ISED BY THE ASSESSEE ARE ALLOWED FOR STATISTICAL PURPOSES. 16. IN THE RESULT, THE APPEALS OF THE ASSESSEE IN I TA NO.609 IS ALLOWED, IN ITA NO.610/CHD/2012 IS PARTLY ALLOWED A ND IN ITA NO.611/CHD/2012 IS ALLOWED FOR STATISTICAL PURPOSES . ORDER PRONOUNCED IN THE OPEN COURT ON THIS 28 TH DAY OF DECEMBER, 2012. SD/- SD/- (T.R.SOOD) (SUSHMA CHOWLA) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED 28 TH DECEMBER, 2012 *RATI* COPY TO: THE APPELLANT/THE RESPONDENT/THE CIT(A)/TH E CIT/THE DR. ASSISTANT REGISTRAR, ITAT, CHANDIGARH 7