ANISH KAPURCHAND CHANDARIA, MUMBAI V. ASST CIT (CPC) BENGALURU, MUMBAI

ITA 7019/MUM/2014

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 3122 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 9 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-09-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2012-2013
• Appeal Filed On: 17-11-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A RAMACHANDRAN
• Assessee Lawyers: P B CHHAPGAR
• Keywords: Principle of natural justice
• Section: 154

Judgement Text

A IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, MUMBAI BEFORE SHRI MAHAVIR SINGH, JUDICIAL MEMBER AND SHRI RAMIT KOCHAR, ACCOUNTANT MEMBER ./ I.T.A. NO.7019/ MUM/2014 ( / ASSESSMENT YEAR : 2012-13) MR. ANISH KAPURCHAND CHANDARIA, UNIT NO. 1202 12 TH FLOOR, TOWER B PENINSULA CORPORATE PARK G K MARG, LOWER PAREL(W) MUMBAI-400013 / V. ACIT (CPC) , BENGALURU ./ PAN : AMNPC1428K ( / APPELLANT ) .. ( / RESPONDENT ) ASSESSEE BY SHRI P B CHHAPGAR REVENUE BY : SHRI A . RAMACHANDRAN / DATE OF HEARING : 22-6-2016 / DATE OF PRONOUNCEMENT : 15-09-2016 / O R D E R PER RAMIT KOCHAR, ACCOUNTANT MEMBER THIS APPEAL, FILED BY THE ASSESSEE , BEING ITA NO. 7019/MUM/2014, IS DIRECTED AGAINST THE APPELLATE ORDER DATED 31 ST JULY, 2014 PASSED BY LEARNED COMMISSIONER OF INCOME TAX (APPEALS)- 10, MUMBAI (H EREINAFTER CALLED THE CIT(A)), FOR THE ASSESSMENT YEAR 2012-13, THE APPE LLATE PROCEEDINGS BEFORE THE LEARNED CIT(A) ARISING FROM THE ASSESSMENT ORDE R DATED 30 TH APRIL , 2014 PASSED BY THE LEARNED ASSESSING OFFICER (HEREINAFTE R CALLED THE AO) U/S 154 OF THE INCOME TAX ACT,1961 (HEREINAFTER CALLED THE ACT). ITA 7019/MUM/2014 2 2. THE ASSESSEE IS AGGRIEVED IN THIS APPEAL BY NON CREDIT OF TAX DEDUCTED AT SOURCE UNDER CHAPTER XVII-B OF THE ACT WITH RESP ECT AND IN PROPORTION TO THE INCOME OFFERED FOR TAXATION IN ACCORDANCE WITH THE PROVISIONS OF SECTION 199 OF THE ACT OF 1961 READ WITH RULE 37BA OF INCOM E TAX RULES, 1962. IT IS THE SAY OF THE ASSESSEE THAT THE ASSESSEE EAR NED COMMISSION INCOME OF RS.1,42,89,500/- FROM AEGIS LOGISTICS LIMITED FOR T HE ASSESSMENT YEAR 2012- 13 ON WHICH TAX WAS DEDUCTED AT SOURCE U/S 195 OF T HE ACT FALLING UNDER CHAPTER XVII-B OF THE ACT OF RS.44,15,455/- FOR WHI CH TDS CREDIT HAS NOT BEEN GIVEN BY THE REVENUE ON THE PRETEXT THAT THE D EDUCTOR HAS CREDITED THE SAID SUM OF AMOUNT OF COMMISSION IN ITS BOOKS OF AC COUNTS TO THE CREDIT OF THE ASSESSEE FOR THE PREVIOUS YEAR ENDED 31-03-2011 I.E. ASSESSMENT YEAR 2011-12 , WHICH COMMISSION WAS SUBJECT TO APPROVAL OF SHAREHOLDERS OF THE DEDUCTOR COMPANY NAMELY AEGIS LOGISTICS LIMITED WHI CH WAS APPROVED BY THE SHAREHOLDERS OF AEGIS LOGISTICS LIMITED ONLY IN THE PREVIOUS YEAR 2011-12 RELEVANT TO THE ASSESSMENT YEAR 2012-13 AND HENCE T HE ASSESSEE HAS RIGHTLY OFFERED THE SAID COMMISSION INCOME OF RS.1,42,89,5 00/- CORRECTLY IN THE RETURN OF INCOME FILED FOR THE ASSESSMENT YEAR 2012 -13 AND CORRECTLY CLAIMED THE CREDIT OF TAX DEDUCTED AT SOURCE OF RS. 44,15,4 55/- U/S. 195 OF THE ACT FALLING UNDER CHAPTER XVII-B OF THE ACT FOR THE ASS ESSMENT YEAR 2012-13 RELYING ON PROVISIONS OF SECTION 199 OF THE ACT OF 1961 READ WITH RULE 37BA OF INCOME TAX RULES, 1962. SIMILARLY, IT IS ALSO THE S AY OF THE ASSESSEE THAT THE COMMISSION INCOME OF RS.1,20,00,000/- EARNED BY THE ASSESSEE ON WHICH TAX WAS DEDUCTED AT SOURCE OF RS. 37,08,000/-UNDER CHAP TER XVII-B OF THE ACT WAS OFFERED TO TAX IN THE ASSESSMENT YEAR 2013-14 W HILE THE DEDUCTOR CREDITED THE SAID COMMISSION TO THE CREDIT OF THE ASSESSEEE IN ITS BOOKS OF ACCOUNTS ON 31-03-2012 BUT WHICH WAS AGAIN SUBJECT TO APPROVAL OF SHAREHOLDERS OF THE DEDUCTOR COMPANY WHICH APPROVAL OF SHAREHOLDER WAS OBTAINED BY DEDUCTOR COMPANY ONLY IN THE PREVIOUS YEAR 2012-13 RELEVANT TO THE ASSESSMENT YEAR 2013-14 AND HENCE THE ASSESSEE HAS RIGHTLY ACCOUNTE D FOR THE SAID ITA 7019/MUM/2014 3 COMMISSION INCOME OF RS.1,20,00,000/- AND CORRESPON DING TDS CREDIT OF RS.37,08,000/- IN ITS RETURN OF INCOME FOR THE ASSE SSMENT YEAR 2013-14 RELYING UPON PROVISIONS OF SECTION 199 OF THE ACT R EAD WITH RULE 37BA OF INCOME TAX RULES, 1962. THERE WAS FURTHER GRIEVANCE OF THE ASSESSEE WITH RESPECT TO DENIAL ON PART OF REVENUE IN GRANTING C REDIT OF TDS OF RS 2790/- TO THE ASSESSEE. IT IS THE SAY OF THE ASSESSEE THAT TH E ASSESSEE INCOME TAX RETURN WAS PROCESSED BY CPC, BANGALORE VIDE COMMUNICATION REFERENCE NO. CPC/1213/P1/1223920339 U/S. 143(1) OF THE ACT WHERE BY DEMAND WAS RAISED BY REVENUE OF RS. 6,62,110/- AS PAYABLE INCL USIVE OF INTEREST PAYABLE UNDER PROVISIONS OF THE ACT ISSUED BY LEARNED ASSIS TANT COMMISSIONER OF INCOME TAX(CPC) (HEREINAFTER CALLED ACIT(CPC)) . T HE DEMAND HAD ARISEN AS THE LEARNED ACIT(CPC) HAS GRANTED CREDIT FOR TDS OF ONLY RS. 37,08,000/- ( WHICH TDS CREDIT IN FACT WAS CLAIMED BY THE ASSESSE E FOR THE SUCCEEDING ASSESSMENT YEAR I.E. 2013-14) AS AGAINST CLAIM OF T DS CREDIT OF RS. 44,15,455/- MADE BY THE ASSESSEE. IT IS THE SAY OF THE ASSESSEE THAT THE ACIT(CPC) ERRED IN GIVING CREDIT OF TDS OF RS.37,08 ,000/- WHICH PERTAINED TO THE ASSESSMENT YEAR 2013-14 AND ALSO ERRED IN DENYI NG CREDIT OF TDS OF RS. 44,15,455/- PERTAINING TO THE INSTANT ASSESSMENT YE AR 2012-13 AGAINST WHICH INCOME OF RS.1,42,98,517/- HAS BEEN OFFERED FOR TAX ATION IN THE INSTANT ASSESSMENT YEAR 2012-13 ON WHICH TDS OF RS.44,15,45 5/- HAD BEEN DEDUCTED AT SOURCE BY THE DEDUCTOR COMPANY AEGIS LO GISTICS LIMITED. THE ASSESSEE MOVED AN APPLICATION U/S. 154 OF THE ACT W ITH ACIT(CPC) ON 12-02- 2014 BUT WITHOUT SUCCESS , OF WHICH REJECTION WAS C OMMUNICATED TO THE ASSESSEE VIDE COMMUNICATION REFERENCE NO. CPC/1213/ T1/1327516022 DATED 30-04-2014 BY ACIT(CPC). 3.THE ASSESSEE CARRIED THE MATTER FURTHER BY FILING FIRST APPEAL WITH LEARNED CIT(A) WHO REJECTED THE CONTENTIONS OF THE ASSESSEE VIDE APPELLATE ORDER DATED 31-07-2014 BY HOLDING THAT PERUSAL OF 26AS CERTIFIC ATE REVEALS THAT THE TRANSACTION OF COMMISSION OF RS.1,42,98,517/- WAS R EPORTED BY DEDUCTOR ITA 7019/MUM/2014 4 COMPANY AEGIS LOGISTICS LIMITED TO THE REVENUE AS O N 31-03-2011 WHEREBY TAX WAS DEDUCTED AT SOURCE UNDER CHAPTER XVII-B U/S 195 OF THE ACT FOR ASSESSMENT YEAR 2011-12 OF RS. 44,15,455/- AND HENC E INCOME WAS TO BE REPORTED BY THE ASSESSEE FOR THE ASSESSMENT YEAR 20 11-12 AND NOT FOR THE ASSESSMENT YEAR 2012-13 AS REPORTED BY THE ASSESSEE .IT WAS HELD BY THE LEARNED CIT(A) THAT THE AO HAS CORRECTLY GIVEN THE CREDIT FOR TAX DEDUCTED AT SOURCE OF RS.37,08,000/- , HOWEVER DIRECTIONS WERE ISSUED BY LEARNED CIT(A) TO BRING TO TAX INCOME OF THE ASSESSEE IN THE COR RECT ASSESSMENT YEAR, VIDE APPELLATE ORDERS DATED 31-07-2014. 4. THE ASSESSEE FILED SECOND APPEAL WITH THE TRIBUN AL AGAINST THE APPELLATE ORDER DATED 31-07-2014 PASSED BY THE LEARNED CIT(A) . THE LEARNED COUNSEL FOR THE ASSESSEE REITERATED THE SUBMISSIONS AS WERE MAD E BEFORE THE AUTHORITIES BELOW WHICH ARE SET OUT IN PRECEDING PARAS OF THIS ORDER AND ARE NOT REPEATED. THE LEARNED COUNSEL PLACED RELIANCE ON SECTION 199 OF THE ACT OF 1961 READ WITH RULE 37BA OF INCOME TAX RULES, 1962 AND PRAYED THAT THE APPROPRIATE RELIEF MAY BE GRANTED TO THE ASSESSEE AS THE ASSESS EE HAS CORRECTLY FILED HIS RETURN OF INCOME WITH THE REVENUE ON WHICH PROPER C REDIT FOR TAX DEDUCTED AT SOURCE WAS CLAIMED BY THE ASSESSEE IN ACCORDANCE WI TH PROVISIONS OF SECTION 199 OF THE ACT READ WITH RULE 37BA OF THE INCOME TA X RULES, 1962. THE LEARNED DR RELIED UPON THE ORDERS OF LEARNED CIT(A) . 5. WE HAVE CONSIDERED THE RIVAL CONTENTIONS AND PER USED THE MATERIAL ON RECORD. WE HAVE OBSERVED THAT THE ASSESSEE HAS OFFE RED FOR TAXATION COMMISSION INCOME OF RS. 1,42,98,518/- FOR THE ASSE SSMENT YEAR 2012-13 ON WHICH TAX IS STATED TO HAVE BEEN DEDUCTED AT SOURCE OF RS. 44,15,455/- WHICH IS CLAIMED BY THE ASSESSEE IN THE RETURN OF INCOME FILED WITH REVENUE. THE SAID COMMISSION INCOME WAS CREDITED TO THE ACCOUNT OF THE ASSESSEE BY DEDUCTOR AEGIS LOGISTICS LIMITED AS AT 31-03-2011 A ND TAX WAS STATED TO HAVE BEEN DEDUCTED AT SOURCE BY THE DEDUCTOR U/S. 195 OF THE ACT AMOUNTING TO ITA 7019/MUM/2014 5 RS. 44,15,455/- WHICH WAS REPORTED TO THE REVENUE T O BE PERTAINING TO THE ASSESSMENT YEAR 2011-12 WHILE THE SAID COMMISSION W AS STATED TO BE SUBJECT TO APPROVAL OF SHAREHOLDERS WHICH APPROVAL WAS ACCO RDED BY THE SHAREHOLDERS OF AEGIS LOGISTICS LIMITED ONLY IN PREVIOUS YEAR 20 11-12 AND HENCE THE ASSESSEE ACCOUNTED FOR THE INCOME AS WELL TAX DEDUC TED AT SOURCE THEREON ONLY IN THE ASSESSMENT YEAR 2012-13 WHICH CLAIM OF CREDIT OF TAX DEDUCTED AT SOURCE WAS DENIED TO THE ASSESSEE IN THE ASSESSMENT YEAR 2012-13 ON THE GROUND THAT TAX DEDUCTED AT SOURCE PERTAINED TO THE ASSESSMENT YEAR 2011-12 WHILE CREDIT OF TAX DEDUCTED AT SOURCE OF RS.37,08, 000/- WAS GRANTED TO THE ASSESSEE WHICH THE ASSESSEE STATED TO HAVE CLAIMED IN THE ASSESSMENT YEAR 2013-14. THE ASSESSEE HAD PLACED RELIANCE ON SECTIO N 199 OF THE ACT OF 1961 READ WITH RULE 37BA OF INCOME TAX RULES, 1962. THE CONTENTIONS OF THE ASSESSEE NEEDS VERIFICATION AND WE ARE SETTING AS IDE AND RESTORING THIS MATTER/ISSUE TO THE FILE OF LEARNED AO/ACIT(CPC) WH O SHALL VERIFY ALL THE CONTENTIONS OF THE ASSESSEE AS WELL AS RETURN OF IN COME FILED FOR THE ASSESSMENT YEARS 2011-12 TO 2013-14 TO ARRIVE AT CO RRECT DECLARATION OF INCOME AND CREDIT OF TAX DEDUCTED AT SOURCE THEREON IN ACCORDANCE WITH PROVISIONS OF THE ACT INCLUDING RELIED UPON PROVISI ONS OF SECTION 199 OF THE ACT READ WITH RULE 37BA OF THE INCOME TAX RULES, 19 62, SPECIFICALLY RULE 37BA(3) OF INCOME TAX RULES, 1962 . IT WILL ALSO BE VERIFIED BY THE LEARNED AO/ACIT(CPC) THAT THERE IS NO DOUBLE CREDIT OF PREP AID TAXES CLAIMED BY THE ASSESSEE FOR THESE ASSESSMENT YEARS 2011-12 TO 2013 -14 AND ALL THE INCOME ARE DULY ACCOUNTED FOR BY THE ASSESSEE AND HENCE, T HEREAFTER, APPROPRIATE RECTIFICATIONS SHALL BE CARRIED OUT BY AO/ACIT(CPC) TO ENSURE CORRECT INCOME IS BROUGHT TO TAX AS WELL CORRECT CREDIT OF PREPAID TAXES ARE GRANTED TO THE ASSESSEE IN ACCORDANCE WITH THE MANDATE OF THE ACT. THERE IS FURTHER GRIEVANCE OF THE ASSESSEE WITH RESPECT TO DENIAL ON PART OF REVENUE IN GRANTING CREDIT OF TDS OF RS 2790/- TO THE ASSESSE E WHICH SHALL ALSO BE LOOKED INTO BY THE AO/ACIT(CPC) IN SET ASIDE PROCEE DINGS. NEEDLESS TO SAY THAT THE LEARNED AO/ACIT(CPC) SHALL GRANT PROPER AN D SUFFICIENT OPPORTUNITY ITA 7019/MUM/2014 6 OF BEING HEARD TO THE ASSESSEE IN ACCORDANCE WITH T HE PRINCIPLES OF NATURAL JUSTICE IN ACCORDANCE WITH LAW. THE ASSESSEE WILL B E ALLOWED TO FILE ALL NECESSARY AND RELEVANT EVIDENCES AND EXPLANATIONS I N SUPPORT OF HIS CONTENTIONS. WE ORDER ACCORDINGLY. 6. IN THE RESULT, APPEAL FILED BY THE ASSESSEE IN I TA NO. 7019/MUM/2014 IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 15 TH SEPTEMBER, 2016. # $% &' 15-09-2016 ( ) SD/- SD/- (MAHAVIR SINGH) (RAMIT KOCHAR) JUDICIAL MEMBER ACCOUNTANT MEMBER $ MUMBAI ; & DATED 15-09-2016 [ .9../ R.K. R.K. R.K. R.K. , EX. SR. PS !'#$%&%# / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. : ( ) / THE CIT(A)- CONCERNED, MUMBAI 4. : / CIT- CONCERNED, MUMBAI 5. =>( 99?@ , ?@ , $ / DR, ITAT, MUMBAI A BENCH 6. (BC D / GUARD FILE. / BY ORDER, = 9 //TRUE COPY// / ( DY./ASSTT. REGISTRAR) , $ / ITAT, MUMBAI