ITO (TDS), Faridabad V. M/s. Ashoka Scrap Traders Pvt. Ltd., Faridabad

ITA 6500/DEL/2016

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 4082 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 1 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-01-2018
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2014-2015
• Appeal Filed On: 20-12-2016
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: RAVIKANT GUPTA
• Keywords: Opportunity of being heard
• Section: 133A; 131; 12; 2

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI A BENCH, NEW DELHI BEFORE SHRI B.P. JAIN, ACCOUNTANT MEMBER, AND SHRI KULDIP SINGH , JUDICIAL MEMBER ITA NO. 6498 & 6 500 /DEL/201 6 [ASSESSMENT YEAR S : 20 1 2 - 1 3 & 2014 - 15 ] THE I.T .O VS. M/S ASHOKA SCRAP TRADERS PVT. LTD TDS WARD DABUA PALI ROAD, FARIDABAD FARIDABAD PAN : AAECA 6779 K [APPELLANT] [RESPONDENT] DATE OF HEARING : 0 3 . 0 1 .201 8 DATE OF PRONOUNCEMENT : 22 . 01 .201 8 ASSESSEE BY : NONE REVENUE BY : SHRI RAVI KANT GUPTA SR. DR ORDER PER B.P. JAIN, ACCOUNTANT MEMBER, BOTH THE ABOVE APPEA L S FILED BY THE REVENUE ARE DIRECTED AGAINST THE TWO DIFFERENT ORDER S DATED 01 . 0 9 .201 6 OF COMMISSI ONER OF INCOME TAX (APPEALS) FARIDABAD AND RELATES TO ASSESSMENT YEAR S 20 12 - 1 3 AND 2014 - 15. S INCE BOTH THE APPEALS WERE HEARD TOGETHER PERTAINING TO SAME ASSESSEE INVOLVING IDENTICAL ISSUES, WE ARE DISPOSING THEM OFF 2 ITA NOS. 6498 & 6500 /DEL/2016 TOGETHER BY THIS COMMON ORD ER FOR THE SAKE OF CONVENIENCE AND BREVITY. 2 . EXCEPT FOR THE QUANTUM OF ADDITION, ALMOST IDENTICAL GROUNDS HAVE BEEN TAKEN BY THE ASSESSEE IN BOTH THE APPEALS. FIRST WE TAKE UP ITA NO. 6498 /DEL/2016. OUR DECISION HEREINBELOW SHALL IDENTICALLY BE APPLICABLE IN ITA NO. 6 500/DEL/2016. ITA NO. 6498/DEL/2016 3 . THE GROUNDS RAISED IN ITA NO. 6498 /DEL/2016 READ AS UNDER: THE DECISION OF LD. CIT (A) IS NOT OF ACCEPTABLE NATURE AS ASSESSEE HAD FAILED TO SUBMIT THE PROOF OF SUBMISSION OF FORM NO.27C TO THE CIT (TDS) AND ALSO IN DEFAULT FOR SHORT/NON COLLECTION OF TAX AT SOURCE U/S 206(6A) & 206C(7) OF THE INCOME TAX ACT, 1961. IN VIEW OF ABOVE FACTS, APPEAL TO THE ITAT IS RECOMMENDED ON THE FOLLOWING GROUNDS OF APPEAL: - 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT (A) HAS ERRED ON FACTS AND IN LAW IN HOLDING THE ASSESSEE NOT IN DEFAULT ON AMOUNT OF THE CLERICAL MISTAKE DISREGARDING THE FACTS THAT BREACH OF LAW CANNOT BE EXCUSED. 3 ITA NOS. 6498 & 6500 /DEL/2016 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASES, DIE LD. CIT (A) HAS ERRED ON FACTS AND IN LAW IN DELETING THE TAX OF RS. 18,79,461/ - CHARGED BY THE ASSESSING OFFICER ON ACCOUNT OF DEFAULT FOR SHORT/ NON COLLECTION OF TAX AT SOURCE U/S 206(6A) & 206C(7) OF INCOME TAX ACT, 196 1 EVEN THROUGH THE ASSESSEE HAS FAILED TO COMPLY WITH THE PROVISION OF SECTION 206(6A) AND 206C(7) FOR SHORT/ NON COLLECTION AND INTEREST THEREON RESPECTIVELY. 4 . BRIEFLY STATED, THE FACTS OF THE CASE ARE THAT A TDS INSPECTION/ SURVEY U/S 133A WAS CONDUCTED ON THE BUSINESS PREMISES OF APPELLANT ON 20.11.2013. DURING THE COURSE OF SURVEY/ INSPECTION, INFORMATION AND THE DOCUMENTS WERE COLLECTED FROM THE APPELLANT. THE APPELLANT IS ENGAGED IN THE BUSINESS OF SALE OF SCRAP. DURING THE SURVEY OPERATION THE DETAILS OF ICS WERE EXAMINED ON THE SALE OF SCRAP. SUMMON U/S 131 OF THE INCOME TAX ACT, 3.961 WERE ISSUED TO THE PR FOR FURNISHING THE REMAINING INFORMATION ON 22.11.2013. THE ASSESSEE WAS ASKED BY THE AO TO SUBMIT FORM NO 27C OBTAINED FROM THE PERIOD 1/4/2011 TO 20/11/2013 ALONG WITH THE DOCUMENTARY EVIDENCES OF HAVING SUBMITTED THE SAME TO C IT (T D S), CHANDIGARH. FROM THE PERUSAL OF THE COPY OF FORMS 27C THE AO OBSERVED THAT DECLARATION / VERIFICATION PART, OF ALL THE FORMS NO. 27C WERE WITHOUT DATE A ND MOREOVER THE COPIES OF THE FORM NO. 27C WERE NOT FURNISHED TO CIT [ TDS ] , CHANDIGARH AND HENCE IT WAS HELD THAT THE 4 ITA NOS. 6498 & 6500 /DEL/2016 APPELLANT WAS AN ASSESSEE IN DEFAULT FOR SHORT / NON COLLECTION OF TCS U/S 206C (6 A) AND 206C( 7) OF THE INCOME TAX ACT, THEREAFTER , AN ORDER U/S 206C(6A) AND 206C( 7) WAS PASSED BY THE INCOME TAX OFFICER (IDS) FOR THE FOLLOWING ASSESSMENT YEARS : A .Y. ORIGINAL DEMAND RECTIFIED DEMAND 2012 - 13 RS. 50,09,707/ - RS. 26,82,480/ - 2013 - 14 RS. 25,18,289/ - RS. 20,90,174/ - 2014 - 15 RS. 16,87,260/ - RS. 16,87,260 5 . THE LD. CIT(A) ALLOWED THE CLAIM OF THE ASSESSEE AND HELD THAT THE ASSESSEE IS NOT IN DEFAULT FOR SHORT/NON COLLECTION OF TAX AT SOURCE U/S 206(6A) & 206C(7) OF THE INCOME - TAX ACT, 1961 [HEREINAFTER REFERRED TO AS 'THE ACT' FOR SHORT]. THE RELEVANT PARA 11 & 13 OF THE LD. CIT(A)S ORDER ARE REPRODUCED HEREINBELOW: 11. THUS FROM THE PERUSAL OF THE ABOVE IT IS EVIDENT THAT THE APPELLANT CANNOT BE HELD AS AN ASSESSEE IN DEFAULT ON ACCOUNT OF THE CLERICAL MISTAKE FOR THE DATE BEING MISSING FROM TH E FORM NO. 27 C WHEN ALL THE OTHER DETAILS OF PURCHASE ARE CORRECT. ON THIS GROUND ALONE THE APPEAL OF THE APPELLANT DESERVES TO BE ALLOWED. AS FAR AS THE ISSUE OF FORWARDING THE COPIES OF FORM NO. 27C TO CIT (IDS)/ CHANDIGARH IS CONCERNED THE APPELLANT HAS FURNISHED THE MONTHLY RECEIPTS OF COURIER THROUGH WHICH THESE COPIES OF FORM NO. 27C HAVE BEEN SENT TO CIT(TDS), CHANDIGARH. 5 ITA NOS. 6498 & 6500 /DEL/2016 IT IS NOT THE CASE OF THE AO THAT THESE COURIER R ECEIPTS A RE FABRICATED. THE CASE OF THE AO IS THAT THE RECEIPT REGISTER OF THE C I T [TD S ] CHANDIGARH DOES NOT S HOW THE RECEIPT OF THESE FORMS SENT BY THE APPELLANT THESE COMMUNICATION HAVE BEEN VERBALLY COMMUNICATED OVER THE TELEPHONE, AND THERE IS NO WRITTEN CONFIRMATION OF THE SAME). ONCE THE APPELLANT HAS F URNISHED THE COURIER RECEIPTS, THE ONUS AS FAR AS THE APPELLANT IS CONCERNED STANDS DISCHARGED. THUS ON THIS PARTICULAR ARGUMENT ONCE AGAIN I FIND NO MERITS IN THE CONTENTION OF THE AO. ANOTHER ARGUMENT ADVANCED BY THE AG HAS BEEN THAT THE STATEMENT OF SH. ASHOK KOCHAR, DIRECTOR OF THE COMPANY REVEALS THAT THE APPELLANT HAD NOT OBTAINED ANY FORM NO. 27C. THE EXTRACT FROM THE STATE MENT HAS BEEN REPRODUCED AT PARA 4 OF THE ORDER OF THE AO. I HAVE PERUSED T HIS EXTRACT OF THE STATEMENT AND FROM A PLAIN READING OF THE SAME I AM UNABLE TO REACH THE SAME CONCLUSION AS OF THE ASSESSING OFFICER. THUS, IN VIEW OF AL LTHESE FACTS, THE APPEAL OF THE APPELLANT DESERVES TO BE ALLOWED. 13. AS PER THE ABOVE 97% CERTIFICATES FOR A.Y. 2012 - 13, 81% CERTIFICAT ES FOR A.Y. 2013 - 14 AND 81% CERTIFICATE FOR THE A.Y. 2014 - 15 HAVE BEEN FURNISHED BY THE APPELLANT DURING THE APPELLATE PROCEEDINGS. IT IS A FACT THAT THESE CERTIFICATES ARE RELEVANT AS REITERATE THE LAW LAID DOWN BY THE HON'BLE SUPREME COURT IN THE CASE O F HINDUSTAN COCA COLA BEVERAGES PVT. LTD. 226 ITR. THESE CERTIFICATES ALSO GONE TO PROVE THAT THE TRANSACTIONS WERE GENUINE IN NATURE AND MORE IMPORTANTLY THAT THERE WAS NO LOSS TO THE REVENUE 6 ITA NOS. 6498 & 6500 /DEL/2016 6 . WE HAVE CONSIDERED THE ARGUMENTS MADE BY THE LD. DR, PERUSED THE ORDERS OF THE A.O AND THE LD. CIT(A). THE ASSESSEE HAS BEEN HELD AS ASSESSEE IN DEFAULT BY THE ASSESSING OFFICER FOR THE REASON THAT THE PART B OF FORM NO. 27C IS WITHOUT DATE AND HENCE THEY ARE FOUND TO BE NOT GENUINE. THERE IS NO PROOF OF SUBMISSION OF FORM NO. 27C TO CIT( TDS), CHANDIGARH, AND THUS THE ASSESSEE HAS NOT FULFILLED HIS STATUTORY DUTIES . T HE ASSESSEE HAS CLAIMED THAT THE COP I ES OF F ORM 27C WERE SUBMIT T ED TO CIT (TDS ) AND THIS CL AIM OF THE ASSESSEE WAS RECTIFIED THROUGH A LETTE R WRITTEN TO CIT(TD S) ON 04.02.2015 TO CONFIRM WHETHER THE F ORM NO. 27C WERE RECEIVED BY THE CIT(TDS), CHANDIGARH. NO WRITTEN RESPONSE WAS RECEIVED FROM CI T(T D S), CHANDIGARH AGAINST THIS LETTER. H OWEVER , VERBALLY IT WAS COMMUNICATED THAT THERE WAS NO SUCH ENTRY IN THE RECEIPT REGISTER. DURING THE COURSE OF SURVEY U/S 13 3A ON 20 .I1. 20 13 THE DIRECTOR OF THE COMPANY COULD NOT CLEARLY REPLY ON THE ISSUE O F F ORM NO. 27C . IT IS A MATTER OF FACT THAT THERE IS M ISTAKE ON THE PART OF THE BUYER. THE ASSESSEE HAS STATED THAT HE HAS PRODUCED FORM NO. 27C OBTAINED FROM THE PARTIES WHICH WERE ALSO PRODUCED BEFORE THE LD. CIT(A). THE ASSESSEE HA S SUBMITTED 97% CERTIFICATES FOR THE ASSESSMENT YEAR 2012 - 13 AND 81% FOR A SSESSMENT YEAR 2014 - 15 DURING THE APPELLATE PROCEEDINGS BEFORE THE LD. CIT(A). IT WAS CLAIMED THAT THESE CERTIFICATES PROVE THE TRANSACTIONS AS GENUINE. AS REGARDS 7 ITA NOS. 6498 & 6500 /DEL/2016 THE SAID CERTIFICATES, THE ASSESSING OFFICER HAS NOT EVEN VERIFIED THESE CERTIFICATES INDE PENDENTLY FROM THE MANUFACTURERS. THE ASSESSING OFFICER SHOULD CONSIDER THE SAID CERTIFICATE IN FORM 27C AND VERIFY FROM THE MANUFACTURER EVEN IF THE SAME HAVE NOT BEEN RECEIVED BY THE CIT [TDS], CHANDIGARH AND DECIDE THE CLAIM OF THE ASSESSEE DE NOVO AFTE R PROVIDING ADEQUATE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. IN THE FACTS AND CIRCUMSTANCES OF THE CASE, THE MATTER IS SET ASIDE TO THE FILE OF THE ASSESSING OFFICER AND THE GROUNDS RAISED BY THE REVENUE ARE ALLOWED FOR STATISTICAL PURPOSES. ITA NO. 6500/DEL/2016 7 . FACTS AND CIRCUMSTANCES AND GROUNDS RAISED IN THIS APPEAL ARE IDENTICAL TO THOSE DECIDED BY US HEREINABOVE IN ITA NO. 6498/DEL/2016. THEREFORE, OUR DECISION HEREINABOVE WILL APPLY MUTATIS MUTANDIS TO THIS ASSESSMENT YEAR ALSO. ACCORDINGLY, THE GROUNDS RAISED IN THIS APPEAL ARE ALLOWED FOR STATISTICAL PURPOSES. 8 ITA NOS. 6498 & 6500 /DEL/2016 8 . IN THE RESULT, BOTH THE APPEAL S OF THE ASSESSEE ARE ALLOWED FOR STATISTICAL PURPOSES . THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 22 . 01.2018 . SD/ - SD/ - [ KULDIP SINGH ] [B.P. JAIN] JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 22 N D JANUARY, 2018 VL/ COPY FORWARDED TO: 1 . APPELLANT 2 . RESPONDENT 3 . CIT 4 . CIT(A) 5 . DR ASST. REGISTRAR, ITAT, NEW DELHI