The General Manager Ranger Breweries Ltd., Una V. Addl. CIT, Shimla

ITA 66/CHANDI/2017

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 6585 (ITAT-CHANDIGARH)
• Duration Of Justice: 10 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-11-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2008-2009
• Appeal Filed On: 06-01-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: CHANDER KANTASR
• Assessee Lawyers: R R THAKUR
• Keywords: Opportunity of being heard; Bonafide belief; Additional evidence; Corroborative evidences; Bonafide mistake
• Section: 133A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DIVISION BENCH, CHANDIGARH BEFORE MS. DIVA SINGH, JUDICIAL MEMBER AND MS. ANNAPURNA GUPTA, ACCOUNTANT MEMBER ITA NOS. 66 TO 68/ CHD/2017 A.YS: 2008-09 TO 2010-11 THE GENERAL MANAGER, VS. THE ADDL. CIT (TDS ), RANGER BREWERIES LTD., TDS RANGE, 130-IA, MAHATPUR, SHIMLA (HP). DISTT. UNA (HP). PAN NO. : PTLR11293C (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI R.R.THAKUR RESPONDENT BY : SMT. CHANDER KANTA,SR.DR DATE OF HEARING : 11.10.2017 DATE OF PRONOUNCEMENT : 13.11.2017 ORDER PER BENCH THE PRESENT APPEALS HAVE BEEN FILED BY THE ASSESSEE AS SAILING THE CORRECTNESS OF THE SEPARATE ORDERS DATED 18.10.2016 OF CIT(A) PALAMPUR IN 2008-09 TO 2010-11 ASSESSMENT YEARS ON IDENTICAL GROUN DS IN EACH OF THESE YEARS. ACCORDINGLY, IT WAS A COMMON STAND OF THE PARTIE S BEFORE THE BENCH THAT FACTS, CIRCUMSTANCES AND POSITION OF LAW IN EACH OF THE APPEALS IS IDENTICAL, ACCORDINGLY THE ARGUMENTS ADVANCED IN ITA 66/ CHD/2017 WOULD APPLY TO THE REMAINING TWO APPEALS ALSO. FOR READY REFER ENCE, THE GROUNDS RAISED IN ITA 66/CHD/2017 ARE REPRODUCED HEREUNDER : 1. THAT THE LD. COMMISSIONER OF INCOME TAX (APPEALS ) PALAMPUR HAS WRONGLY DISMISSED THE APPEAL OF THE APPELLANT, THOUGH THE A PPELLANT WAS PREVENTED BY A SUFFICIENT CAUSE. 2. THAT THE LD. COMMISSIONER OF INCOME TAX (APPEAL S) HAS RIOT CONSIDERED THE CIRCUMSTANCES OF THE CASE AS THE APPELLANT WAS PREV ENTED BY A SUFFICIENT CAUSE FOR NOT FILING THE QUARTERLY RETURNS IN FORM NO. 27 EQ. IN TIME. 3. THAT THE ID. COMMISSIONER OF INCOME TAX (APPEAL S) HAS FAILED TO UNDERSTAND THAT IT WAS A TECHNICAL MISTAKE AND THERE WAS NO REVENUE LOSS. THE PENALTY HAS WRONGLY BEEN CONFIRMED. 2. THE LD. AR INVITING ATTENTION TO THE STATEMENT OF FACTS FILED ON RECORD STATED THAT THE ASSESSEE COMPANY IS ENGAGED IN THE BUSINESS OF MANUFACTURING BOTTLING AND SALE OF ALCOHOL (IMFL AND COU NTRY LIQOUR) AT MAHATPUR AND IS REQUIRED TO DEDUCT AND COLLECT TAX AT SOURCE. DURING THE YEAR ITA 66TO68-2017 A.Y.2008-09 TO 2010-11 PAGE 2 OF 5 UNDER CONSIDERATION THE TDS WAS CORRECTLY DEDUCTED AN D PAID TO THE GOVT. A/C IN THE STIPULATED TIME. THE LD. AR SUBMITTED THAT THE D ELAY IN FILING OF THE QUARTERLY STATEMENT HAS OCCURRED ON ACCOUNT OF THE FA CT THAT THE PAN NUMBERS COULD NOT BE OBTAINED BY THE ASSESSEE IN TIME DESPITE ITS B EST EFFORTS. IT HAS ALSO BEEN ARGUED THAT THERE IS NO LOSS TO THE RE VENUE AND ONLY THE FILING OF THE QUARTERLY STATEMENT WAS DELAYED AND SINCE ITS AC COUNTANT HAD ALSO LEFT, THE ASSESSEE COULD NOT ARGUE ITS CASE PROPERLY. IN TH E CIRCUMSTANCES RELYING UPON THE DECISION OF THE HON'BLE GUJRAT HIGH COURT IN THE CASE OF CIT VS HARSIDDH CONSTRUCTION PVT.LTD. (2000) 244 ITR 417 (GUJ), I T WAS HIS PRAYER THAT THE PENALTY ORDERS MAY BE QUASHED. 4. THE LD. SR.DR RELIES UPON THE ORDERS OF THE AUTHORITIES BELOW. 5. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. A PERUSAL OF THE PENALTY ORDER U/S 272A(2)(K) W ITH THE PENALTY ORDER SHOWS THAT COGNIZANCE HAS BEEN TAKEN OF THE FOLLOW ING FACTS A SURVEY U/S 133A WAS CARRIED ON 26.03.2010 ON THE ASSESSEE AND DURING THE SURVEY, IT WAS NOTICED THAT THE DEDUCTOR ASSESSEE H AD NOT FILED QUARTERLY STATEMENTS OF TDS FOR DIFFERENT QUARTERS IN SUPPORT OF THE PAYMENTS OTHER THAN SALARY WITHIN THE SPECIFIED TIM E AS PROVIDED UNDER THE PROVISO TO SUB-SECTION (3) OF SECTION 206C OF THE INCOME TAX ACT,1961. IT WAS NOTICED THAT THE RELEVANT STATEMENT FOR THE 2 ND QUARTER WAS FILED ON 13.5.2010 AS AGAINST DUE DATE OF 15.10.200 7 WHICH RESULTED IN A DELAY OF 941 DAYS. SIMILARLY, IT WAS ALSO NOTICED THAT TH E RETURN FOR THIRD & FOURTH QUARTER WAS ALSO FILED ON 13.5.2010 AS AGAINST THE D UE DATES OF 15.1.2008 & 15.6.2008 RESPECTIVELY RESULTING IN A DELAY OF 848 & 756 DA YS RESPECTIVELY. AS A RESULT, THE TOTAL DELAY WAS WORKED OUT AS 2545 CL AYS. IN VIEW THEREOF, THE REQUIREMENTS OF THE PROVISO TO SUB-SECTION (3) OF SECTION 206C WERE FOUND TO BE NOT FULFILLED. THE ASSESSEE WAS ISSUED A SHOW CAUSE NOTIC E U/S 272A(2)(K) DATED 13.08.2010. SINCE THE ASSESSEE IN REPLY THERETO IN THE PENALTY PROCEEDINGS ONLY SOUGHT TIME, ACCORDINGLY, IN THE ABSENCE OF ANY REPRESENTATION, THE ASSESSEE WAS HELD LIABLE TO PAY PENA LTY OF RS. 2,54,500/-. ON ACCOUNT OF SIMILAR REASONS, PENALTY IN THE REMAINING TWO YEARS HAS ALSO BEEN IMPOSED BY THE AO. 5.1 THE ASSESSEE CARRIED THE ISSUE IN APPEAL BEFORE THE CIT(A), BEFORE WHOM THE FOLLOWING SUBMISSIONS ARE FOUND TO HAVE BEEN ADVANCED : APPELLANT SUBMISSION:- DURING HEARING OF THE APPEAL, THE APPELLANT HAS MAD E VERBAL AS WELL AS WRITTEN SUBMISSIONS WHICH ARE DISCUSSED AS UNDER :- 1. THE APPELLANT HAS BEEN DEALING WITH THE BUSINESS OF MANUFACTURING, BOTTLING AND SALE OF ITA 66TO68-2017 A.Y.2008-09 TO 2010-11 PAGE 3 OF 5 ALCOHOL (IMFL & COUNTER LIQUOR) AT PLOT NO-130, L.A . MEHATPUR, DISTT. UNA AND I REQUIRED TO DEDUCT AND COLLECT TAX AT SOURCE. DURIN G THE YEAR UNDER CONSIDERATION THE TDS WAS DEDUCTED CORRECTLY AND PAYMENT OF THE SAME WAS MADE TO THE GOVT. TREASURY WITHIN STIPULATED TIME. THERE WAS NO REVENUE LOSS TO THE G OVT. WHILE THERE WAS DELAY II FILING THE FORM 27EQ FOR THE QUARTERS ENDING SEPT. 2007, DEC. 2007 & MARCH, 2008. THE SAID FORMS (RETURNS) OF ABOVE SAID QUARTERS WERE FILED ON 13.05.2010, I. E. BEFORE THE ISSUE OF SHOW-CAUSE NOTICE FOR PENALTY UNDER REFERENCE. 2. BASED ON THE INFORMATION THE LD. ADDL. COMMISSIONER OF INCOME TAX (TDS) PROCEEDED TO LEVY THE PENALTY. THE LD, ADDL. COMMISSIONER'S PERC EPTION WAS THAT ANY REASON HAS NO BEEN GIVEN IN WRING FOR DELAY IN FILING THE QUARTE RLY RETURNS AND THEREFORE THE LD. ADD COMMISSIONER CAME TO CONCLUSION THAT THERE IS NO RE ASONABLE CAUSE AND IMPOSED THE PENALTY U/S 272A(2)(K) OF RS. 100/- PER DAY AMOUNTING TO RS . 2,54,000/-. 3. IN THIS CONTEXT, IT IS SUBMITTED THAT AT THE MATERI AL TIME WHEN THE CASE WAS FIXED FOR HEARING THE CONCERNED OFFICER (ACCOUNTS OFFICER) LE FT THE JOB AND COMPANY REMAINED TIN CONCERNED POST LESS FOR MORE THAN SIX MONTHS. DUE T O THAT REASON, FACT AND CAUSES FOR DELAY IN FILING THE QUARTERLY RETURNS COULD NOT BE SUBMITTED TO LD. ADDL. C1T (TDS). 4. THERE WERE CERTAIN DELAYS IN FILING OF E-TCS RETURN S DUE TO REASON THAT ASSESSEE COMPANY HAD NO PAN OF COLLECTEES/ BUYERS OF LIQUOR. AS A NA TURE OF BUSINESS, THE MOST OF THE BUYERS OF OUR PRODUCTS CHANGES EVERY YEAR DUE TO CH ANGE OF LIQUOR LICENSE IN AUCTION SYSTEM. IN SPITE OF RIGOROUS FOLLOW UP IN WRITING A ND TELEPHONIC WITH COLLECTEES, THE ASSESSEE COMPANY COULD NOT GET THE REQUISITE PAN WITHIN STIP ULATED TIME TO FILE THE E-TCS RETURNS WITHIN TIME. 5. AS PER CBDT GUIDELINES, FORM 27EQ WITH LESS THAN 7 0% OF PAN DATA WAS NOT ACCEPTED W.E.F. QUARTER ENDING 30.09.2007 WITH NON AVAILABIL ITY OF REQUISITE PAN DATA THE ASSESSEE COMPANY COULD NOT SUBMIT THE E-TCS RETURNS WITHIN D UE DATE. 6. FROM THE SUBMISSIONS STATED ABOVE, IT IS STATED THAT, THE REASONS FOR DELAY COULD NOT BE SUBMITTED BEFORE LD. ADDL. CIT (TDS) AND FURTHER TH E ASSESSEE COMPANY WAS PREVENTED BY SUFFICIENT CAUSE FROM FILING THE RETURNS WITHIN THE STATUTORY PERIOD. THEREFORE, THE DEFAULT IS NOT DELIBERATE OR INTENTIONAL AND NON FI LING OF RETURNS DOES NOT RESULT IN ANY REVENUE LOSS. 5.2. APART FROM THAT, THE ASSESSEE PLACED RELIANCE ON VARIOUS DECIS IONS OF THE ITAT AND ALSO PLACED FRESH EVIDENCE ON RECORD. THE EVIDEN CE AND SUBMISSIONS WERE CONFRONTED TO THE AO WHICH WERE OPPOSED BY THE A O. THE OBJECTIONS IN THE REMAND REPORT DATED 22.08.2016 HAS BEEN EXTRACTED IN THE IMPUGNED ORDER. FOR READY REFERENCE, SAME IS REPRODUCED HEREUNDER : 'AT THE OUTSET IT IS PRAYED THAT SINCE SUFFICIENT O PPORTUNITY WAS AFFORDED BY LD. ADDL. C1T TDS RANGE-SHIMLA TO THE ASSESSEE DEDUCTOR THEREFORE NO FRESH EVIDENCE/ ADDITIONAL EVIDENCE MAY KINDLY BE ADMITTED. WITHOUT PREJUDICE TO ABOVE EVEN ON MERIT THE ASSESS EE DEDUCTOR HAS CLAIMED THAT HIS ACCOUNTS OFFICER LEFT AT THE TIME OF HEARING OF CASE BEFORE LD. ADDL. CIT THEREFORE HE COULD NOT FURNISH ANY EVIDENCE BEFORE THE LD. ADDL, CIT, TDS RANGE-SHIMLA . KEEP ASIDE THE EVIDENCE THE ASSESSEE DID NOT BOTHER TO ATTEND OR FILE REQUEST ON LAST TWO OC CASION THIS SHOWS THAT ASSESSEE/ DEDUCTOR CLAIM DOES NOT GIVEN HIM JUSTIFIABLE REASON FOR ADM ISSION OF ADDITIONAL EVIDENCE. ON NEXT ALSO THE PLEA TAKEN BY HIM IS THAT HE WAS N OT HAVING PAN NUMBERS OR COLLECTEES / BUYERS AND HE CONTINUALLY FOLLOWED WITH THEM IS NOT ACCEPTABLE. AS PER INCOME TAX ACT 1961 IT IS THE DUTY OF THE COLLECTOR TO OBTAIN, PAN NUMBER OF THE COLLECTEES AND IT HAS TO COLLECT TCS AND THEREAFTER DEPOSIT THE TCS INTO CENTRAL GOVT. ACCOU NT WITHIN PRESCRIBED PERIOD AND FILE THE RETURN OF TCS IN PRESCRIBED FORM, IN THIS CASE 27EQ WITHIN THE TIME PRESCRIBED FOR THE SAME, WHICH ASSESSEE FAILED. THIS FAILURE TO OBTAIN PAN W ITHIN TIME FROM THE COLLECTEE DOES NOT GIVEN THE COLLECTOR RIGHT TO FILE RETURN BEYOND TIM E PRESCRIBED BY THE IT. ACT. MOREOVER, THE EFFORT WHICH COLLECTOR IS CLAIMING HE HAS MADE ARE JUST WORD AND THERE ARE FEW LETTERS WRITTEN TO THE COLLECTEE WHICH MAY BE A RECORD THAT MIGHT HAVE BEEN CREATED AT A LATER DATE BEFORE ACCEPTING SUCH RECORD YOUR HONOUR IS REQUEST ED TO GET THE CARBON DATING OF THIS RECORD, IT MAY KINDLY BE GOT EXAMINED FORENSICALLY IF DEEMED FIT. IN VIEW OF ABOVE, YOU ARE REQUESTED TO KINDLY NOT ALLOW ADDITIONAL EVIDENCE B Y THE ASSESSEE DEDUCTOR. EVEN ON MERIT IT IS PRAYED THAT THE APPEAL OF ASSESSEE MAY KINDLY BE DISMISSED. ITA 66TO68-2017 A.Y.2008-09 TO 2010-11 PAGE 4 OF 5 (EMPHASIS SUPPLIED) 5.3 THE CIT(A) RELYING UPON THE REMAND REPORT, DISMISSED THE APPEAL. IN THE LIGHT OF THE SAID BACKGROUND, THE RELIANCE PLACED BY THE LD. AR ON THE DECISION OF THE HON'BLE GUJRAT HIGH COURT IS NOT OF MUCH HELP AS T HE ASSESSEE FIRST NEEDS TO ESTABLISH THAT THERE WAS BONAFIDE MISTAKE AND M ERELY BECAUSE THERE WAS NO LOSS TO THE REVENUE, IS NOT A GOOD ENOUGH GROUN D TO QUASH THE PENALTY PROCEEDINGS. SPECIFIC DUTY HAS BEEN CAST UPON THE TAX PAYER BY THE STATUTE. THE ARGUMENT THAT THE ASSESSEE'S ACCOUNTANT LEFT IS UN SUPPORTED BY ANY EVIDENCE. NO SUCH SUPPORTING EVIDENCE BY WAY OF AN AFFIDAVIT OF M.D. NAMING AND IDENTIFYING THE ACCOUNTANT ALLEGEDLY RESPONSIBLE WITH A CLEAR MENTION AS TO ON WHICH DATE THE RESPONSIBLE PERSON HAS LEFT ETC. HAS BEEN PLACED ON RECORD. SIMILARLY THE ARGUMENT THAT DESPITE ITS BEST EFFORT S THE ASSESSEE COULD NOT GET THE DETAILS IS A MERE ARGUMENT AGAIN IS UNSUPPO RTED BY ANY FACT OR EVIDENCE. WE FIND THAT THE ORAL ASSERTIONS ARE NOT SUPPO RTED BY ANY EVIDENCE IN AS MUCH AS THE ASSESSEE HAS NOT EVEN CARED TO NAM E THE SPECIFIC PERSONS WHO WERE DEPUTED TO ADDRESS THE ISSUE BEFORE THE AO. NO AFFIDAVIT OF ANY PERSON HAS BEEN PLACED ON RECORD IN SUPPORT OF THE COR RECTNESS OF THE CLAIM IN AS MUCH AS THAT THE DELAY HAS OCCURRED EITHER ON ACCO UNT OF A BONAFIDE MISTAKE OR FOR REASONS BEYOND THE CONTROL OF THE ASSESS EE. WE NOTE THAT IN THE FACTS AS CONSIDERED BY THE HON'BLE HIGH COURT IN CIT VS HARSIDDH CONSTRUCTION PVT. LTD BEFORE THE TRIBUNAL IT HAD BEEN AR GUED THAT THE ASSESSEE WAS UNDER A BONAFIDE BELIEF AND ENTERTAINED AN H ONEST IMPRESSION THAT THE CERTIFICATE IN QUESTION COULD BE ISSUED AT THE E ND OF THE ACCOUNTING YEAR. THE TRIBUNAL HAD HELD IN THE FACTS OF THE SAID CASE THAT IT WAS NOT A CASE OF DELIBERATE DISREGARD OF THE LEGAL OBLIGATIONS CAST U PON THE ASSESSEE. IN THE FACTS OF THE PRESENT CASE, THE AO IN THE REMAND PRO CEEDINGS HAS CATEGORICALLY ADDRESSED THE FACT THAT THE ASSESSEE EVE N DID NOT CARE TO PUT IN AN APPEARANCE IN THE PENALTY PROCEEDINGS. ACCORDINGLY, WIT HOUT FIRST ADDRESSING THE FACTS, THE RELIANCE PLACED ON DECISIONS IS OF NO HELP AS WITHOUT FIRST DEMONSTRATING THE APPLICABILITY OF THE SAID DECISION TO T HE FACTS OF THE CASE RELIANCE IS MISPLACED. ACCORDINGLY, IN THE INTERESTS OF SUBSTANTIAL JUSTICE, THE ISSUE IS SET ASIDE BACK TO THE FILE OF THE CIT(A) WITH A DIRECTION TO DECIDE THE SAME IN ACCORDANCE WITH LAW AFTER PROVIDING THE ASSES SEE A REASONABLE OPPORTUNITY OF BEING HEARD. THE ASSESSEE SHALL BE GIVEN O PPORTUNITY TO PLACE WHATEVER EVIDENCE, FACTS AND SUBMISSIONS ON RECORD IN SUP PORT OF ITS CLAIM. THE ASSESSEE IN ITS OWN BEST INTERESTS IS ADVISED TO PAR TICIPATE FULLY AND FAIRLY BEFORE THE CIT(A) BY MAKING PROPER COMPLIANCES. LIBERTY TO FILE EVIDENCES IN ITA 66TO68-2017 A.Y.2008-09 TO 2010-11 PAGE 5 OF 5 SUPPORT OF THE CLAIM IS GRANTED WHERE THE ASSESSEE SHALL ADDRESS THE OBJECTIONS OF THE AO. THE DECISIONS OF COURTS AND TRIBUNA LS WOULD COME INTO PLAY ONLY AFTER FACTS HAVE BEEN ADDRESSED. WHILE DO DIREC TING, IT IS HOPED THAT THE OPPORTUNITY SO PROVIDED IS NOT ABUSED BY THE ASSES SEE AS IN THE EVENTUALITY OF ABUSE OF THE SAME, THE LD. CIT(A) WOULD BE AT LIBERTY PASS A SPEAKING ORDER ON THE BASIS OF MATERIAL AVAILABLE ON RECOR D. SAID ORDER WAS PRONOUNCED IN THE OPEN COURT AT THE TIME OF HEARING ITSELF. 6. IN THE RESULT, THE APPEALS OF THE ASSESSEE ARE ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 13 TH NOV., 2017. SD/- SD/- (ANNAPURNA GUPTA) (DIVA SI NGH) ACCOUNTANT MEMBER JUDICIAL MEMBER POONAM COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT 4. THE CIT(A) 5. THE DR ASSTT. REGISTRAR