Homes at Leisure LLP, Gurgaon V. DCIT - CPC, Bangalore

ITA 7423/DEL/2019

• Counselvise Citation: [2021] 108 COUNSELVISE.COM (IT) 2332 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 9 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-06-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2016-2017
• Appeal Filed On: 09-09-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Reasonable cause; Condonation of delay; TDS; Set aside
• Section: 143(1); 20

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI BENCH: SMC-2 NEW DELHI BEFORE SHRI KUL BHARAT, JUDICIAL MEMBER AND SHRI O.P. KANT, ACCOUNTANT MEMBER [THROUGH VIDEO CONFERENCING] ITA NO. 7423/DEL./2019 ASSESSMENT YEAR: 2016-17 HOMES AT LEISURE LLP, 224, VIPUL TRADE CENTRE, SOHNA ROAD, GURGAON VS. DCIT, CPC, BANGALORE PAN :AAGFH9418M (APPELLANT) (RESPONDENT) ORDER PER O.P. KANT, AM: THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST OR DER DATED 20/06/2019 PASSED BY THE LEARNED COMMISSIONER OF IN COME-TAX (APPEALS)-1, GURGAON [IN SHORT THE LD. CIT(A)] FO R ASSESSMENT YEAR 2016-17 AGAINST THE ORDER PASSED UNDER SECTION 143(1) OF THE INCOME-TAX ACT, 1961 (IN SHORT THE ACT) BY THE DE PUTY COMMISSIONER OF INCOME-TAX, CENTRAL PROCESSING CENT RE, BANGLORE [HEREINAFTER REFERRED TO AS THE ASSESSING OFFICER ]. THE LD. CIT(A) APPELLANT BY SH. SATYEN SETHI, ADV. MS. GARGEE SETHEE, ADV. RESPONDENT BY SH. R.K. GUPTA, SR.DR DATE OF HEARING 08.06.2021 DATE OF PRONOUNCEMENT 28.06.2021 2 ITA NO.7423/DEL/2019 HAS DISMISSED THE APPEAL ON ACCOUNT OF DELAY OF 20 MONTHS, WHICH HAS NOT BEEN CONDONED BY HIM. THE GROUNDS RAI SED BY THE ASSESSEE ARE REPRODUCED AS UNDER: 1. THAT, ON FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, LD. COMMISSIONER OF INCOME TAX (APPEALS) [HEREIN AFTER REFERRED TO AS LD. CIT(A)] FAILS TO CONSIDER THE CAUSE FOR DELAY IN FILING THE APPEAL THAT HAS BEEN SUBMITTED AND ALSO EXPLAINED B Y THE APPELLANT IN THE COURSE OF APPELLATE PROCEEDINGS. T HE CIT(A) HAS ERRED IN REJECTING THE CONDONATION OF DELAY IN FDIN G THE APPEAL, ALTHOUGH THERE WAS A SUFFICIENT AND REASONABLE CAUS E FOR THE DELAY IN FILING. 2. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF TH E CASE AND IN LAW, LD. CLT(A)ERRED IN UPHOLDING THE DISALLOWANCE OF CR EDIT OF TDS OF RS. 1,44,167/- IN THE ASSESSMENT YEAR 2016-17, WITH OUT APPRECIATING THE CONTENTION OF THE APPELLANT REGARD ING THE ALLOWABILITY OF THE SAID CREDIT. 3. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF TH E CASE AND IN LAW, LD. CIT(A) ERRED IN DISREGARDING THE PROVISIONS OF RULE 37BA OF THE INCOME TAX RULES, 1962 READ WITH SECTION 199 OF THE INCOME TAX ACT, 1961, AND THEREBY UPHOLDING THE DISALLOWANCE O F CREDIT THE TDS OF RS. 1,44,167/- FOR THE ASSESSMENT YEAR 2016- 17, THE ASSESSMENT YEAR FOR WHICH CORRESPONDING INCOME IS A SSESSABLE. 4. WITHOUT PREJUDICE TO THE ABOVE GROUNDS OF APPEAL , THE APPELLANT SUBMIT THAT, THE CREDIT OF TDS OF RS. 1,44,167/- SH OULD BE ALLOWED IN THE YEAR IN WHICH TDS WAS DEDUCTED I.E. HERE IN THE PRESENT CASE, IN ASSESSMENT YEAR 2015-16, IF THE SAME IS NO T ALLOWED IN THE YEAR IN WHICH INCOME IS OFFERED (I.E. HERE IN T HE ASSESSMENT YEAR 2016-17). 5. THAT THE APPELLANT CRAVES LEAVE TO ADD, ALTER, A MEND OR VARY ANY OF THE GROUND EITHER AT OR BEFORE THE HEARING OF TH E APPEAL. 2. BRIEFLY STATED FACTS OF THE CASE ARE THAT THE ASSES SEE FILED RETURN OF INCOME 31/07/2016, DECLARING TOTAL INCOME OF 4,28,020/- AND CLAIMED CREDIT OF TAX DEDUCTED AT SO URCE (TDS) OF 1,44,167/-. ACCORDING TO THE ASSESSEE, THE PAYEE I .E. MAHINDRA HOMES PRIVATE LIMITED, HAS SHOWN ABOVE TDS IN THE STATEMENT CORRESPONDING TO ASSESSMENT YEAR 2015-16 AND 3 ITA NO.7423/DEL/2019 CONSEQUENTLY, CREDIT OF THIS TDS IS BEING REFLECTED IN FORM NO. 26AS OF THE ASSESSEE FOR ASSESSMENT YEAR 2015-16. T HE ASSESSING OFFICER WHILE PASSING ORDER UNDER SECTION 143(1) DA TED 27/09/2016 DID NOT ALLOW THE CLAIM OF CREDIT OF SAI D TDS AMOUNT OF 1,44,167 /- AND DEMAND OF 1,45,082/- WAS RAISED IN THE IMPUGNED ORDER DATED 27/09/2016 UNDER SECTION 143(1 ) OF THE ACT. AGGRIEVED, THE ASSESSEE FILED APPEAL BEFORE TH E LEARNED CIT(A) ON 06/02/2018 I.E. AFTER A DELAY OF ALMOST 20 MONTH S. 2.1 BEFORE THE LD. CIT(A) , THE ASSESSEE SUBMITTED THA T AS PER THE PROVISIONS OF SECTION 199 OF THE ACT READ WITH RULE 37BA OF INCOME TAX RULES, 1962 (IN SHORT THE RULES) THE CREDIT OF THE TDS HAS TO BE GIVEN IN THE ASSESSMENT YEAR IN WHICH CORRESPONDING INCOME IS OFFERED FOR TAXATION/ASSESS ABLE. ACCORDING TO THE ASSESSEE IN VIEW OF THE DENIAL OF TDS CREDIT, THERE WERE TWO OPTIONS BEFORE HIM. FIRST OPTION WAS FILIN G OF RECTIFICATION APPLICATION BEFORE THE ASSESSING OFFICER AND SECOND OPTION WAS TO FILE APPEAL BEFORE THE LEARNED CIT(A). THE ASSESSEE SUBMITTED THAT HE EXERCISED FIRST OPTION OF FILING RECTIFICATION A PPLICATION, HOWEVER LATER ON THE ASSESSEE CAME TO KNOW THAT THE FIRST O PTION EXERCISE BY IT WAS NOT APPROPRIATE AND THEREFORE RESORTED TO SECTION OPTION FOR FILING THE APPEAL BEFORE THE LEARNED CIT(A). 2.2 THE LD. CIT(A) DID NOT CONDONE THE DELAY IN FILING THE APPEAL ON THE GROUND THAT THERE WAS NO SUFFICIENT CAUSE FO R THE DELAY IN FILING THE APPEAL. THE LEARNED CIT(A) RELIED ON THE VARIOUS DECISIONS CITED IN HIS ORDER. 3. BEFORE US, BOTH THE PARTIES APPEARED THROUGH VIDE O- CONFERENCING FACILITY. 4 ITA NO.7423/DEL/2019 4. WE HAVE HEARD RIVAL SUBMISSION OF THE PARTIES ON T HE ISSUE IN DISPUTE. ACCORDING TO US THE ONLY DISPUTE IS WHE THER THE REASON FOR DELAY IN FILING THE APPEAL CONSTITUTES SUFFICIE NT CAUSE OR NOT. THE CONTENTION OF THE ASSESSEE THAT IT HAS FILED RE CTIFICATION APPLICATION BEFORE THE ASSESSING OFFICER AND WHICH WAS NOT DISPOSED OFF AND THEREFORE THE FILED THE PRESENT AP PEAL BEFORE THE LEARNED CIT(A). IN OUR OPINION, THE TAX OF 1,44,167/- HAS BEEN DEDUCTED AT SOURCE BY THE PAYEE AND DEPOSITED IN GO VERNMENT ACCOUNT ON BEHALF OF THE ASSESSEE. THE PAYEE IN HIS TDS RETURN SHOWN THE TAX DEDUCTED IN ASSESSMENT YEAR 2015-16, WHEREAS ACCORDING TO THE ASSESSEE, THIS INCOME WAS RECEIVED IN ASSESSMENT YEAR 2016-17 AND THEREFORE CREDIT WAS CL AIMED IN THE RETURN FILED FOR ASSESSMENT YEAR 2016-17. THE ASSES SING OFFICER IN ORDER UNDER SECTION 143(1) HAS NOT GIVEN CREDIT, PR OBABLY BECAUSE SAME WAS NOT REFLECTED IN INFORMATION OF THE PRE-PA ID TAXES FOR THE YEAR UNDER CONSIDERATION AVAILABLE ON SYSTEM OF THE INCOME-TAX DEPARTMENT. IN OUR OPINION, PRIMA-FACIE THIS WAS AN ISSUE OF RECTIFICATION AND THE ASSESSING OFFICER SHOULD HAVE DISPOSED THE RECTIFICATION APPLICATION OF THE ASSESSEE. BUT THE ASSESSEE CAUTIOUSLY OPTED FOR THE ALTERNATIVE REMEDY. THERE IS NO DISPUTE AS TO DEDUCTION OF THE TAX AMOUNTING TO 1, 44, 167/- AND THE ASSESSEE CANNOT BE DEPRIVED OF THE CREDIT OF THE SA ID TAX DEPOSITED. THE DELAY HAS OCCURRED DUE TO EXERCISING OF THE OPTION OF RECTIFICATION APPLICATION, WHICH REMAINED UNATTE NDED BY THE DEPARTMENT. THE ASSESSEE IS NOT GAINING IN ANY MANN ER IN FILING THE APPEAL WITH THE DELAY. NO MALAFIDE HAS BEEN OBSERVED IN THE ACTION OF THE ASSESSEE. IN OUR OPINION, IN SUCH CI RCUMSTANCES, FILING OF THE APPEAL WITH THE DELAY, CONSTITUTE A S UFFICIENT AND 5 ITA NO.7423/DEL/2019 REASONABLE CAUSE. IN THE INTEREST OF SUBSTANTIAL JU STICE, REJECTING THE REQUEST OF CONDONATION OF THE DELAY IN FILING THE APPEAL BY THE LD. CIT(A) IS NOT JUSTIFIED . ACCORDINGLY, THE FIND ING OF THE LD. CIT(A) ON THE ISSUE IN DISPUTE IS SET ASIDE AND THI S APPEAL IS RESTORED TO FILE OF THE LD. CIT(A) FOR DECIDING AFR ESH ON MERIT. THE GROUNDS OF THE APPEAL OF THE ASSESSEE ARE ACCORDING LY ALLOWED FOR STATISTICAL PURPOSES. 5. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOW ED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 28 TH JUNE, 2021 SD/- SD/- (KUL BHARAT) (O.P. KANT) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 28 TH JUNE, 2021. RK/- (DTDS) COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR ASST. REGISTRAR, ITAT, NEW DELHI