SMT. SANDHYA GUGALIA, JAIPUR V. DEPUTY COMMISSIONER OF INCOME TAX-CPC-TDS, GHAZIABAD

ITA 77/JPR/2018

• Counselvise Citation: [2018] 121 COUNSELVISE.COM (IT) 6112 (ITAT-JAIPUR)
• Duration Of Justice: 4 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-06-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2014-2015
• Appeal Filed On: 23-01-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: PG J VIHYKFKHZ IZRFKHZ
• Assessee Lawyers: PRADEIP GUGALIA SMT

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHE S, JAIPUR JH FOT; IKWY JKO] U;KF;D LNL; ,OA JH FOE FLAG ;KNO] YS[KK LNL; DS LE{K BEFORE: SHRI VIJAY PAL RAO, JM & SHRI VIKRAM SINGH YADAV, AM VK;DJ VIHY LA-@ ITA NO. 77 & 78/JP/2018 FU/KZKJ.K O'K Z@ ASSESSMENT YEAR : 2014-15 SMT. SANDHYA GUGALIA F-80, RAM PATH, SHYAM NAGAR, JAIPUR CUKE VS. DCIT, CPC-TDS, GHAZIABAD, U.P LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO.: ABYPG0441J VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ L S@ ASSESSEE BY : SHRI PRADEIP GUGALIA JKTLO DH VKSJ LS @ REVENUE BY : SMT POONAM RAI (DCIT) LQUOKBZ DH RKJH[ K@ DATE OF HEARING : 04/06/2018 MN?KKS'K.KK DH RKJH[ K@ DATE OF PRONOUNCEMENT: 08/06/2018 VKNS'K@ ORDER PER: VIKRAM SINGH YADAV, A.M. THESE ARE TWO APPEALS FILED BY THE ASSESSEE AGAINST THE ORDER OF LD. CIT(A)-3, JAIPUR DATED 27.11.2017 AND 02.11.2017 FO R ASSESSMENT YEAR 2014- 15. IN ITS APPEAL, THE ASSESSEE HAS CHALLENGED THE LEVY OF INTEREST AND LATE FEES U/S 234E OF THE ACT. 2. BRIEFLY STATED, THE FACTS OF THE CASE ARE THAT T HE ASSESSEE ENTERED INTO AN AGREEMENT FOR PURCHASE OF A RESIDENTIAL HOUSE AT C-127, RISHABH PATH, BHAGIRATH MARG, SHYAM NAGAR, JAIPUR WHICH WAS JOINT LY OWNED BY SMT. RASHI HARNEJA AND SMT. RAVINDRA HARNEJA FOR A SUM OF RS. 75,00,000/-. THEREAFTER, IN RESPECT OF PAYMENT OF RS. 37,50,000/- TO SMT. RA SHI HARNEJA, THE ASSESSEE DEPOSITED A SUM OF RS. 37,500/- TOWARDS TDS VIDE CH ALLAN-CUM-FORM 26QB ON 25.09.2013. SIMILARLY, IN RESPECT OF PAYMENT OF RS. 37,50,000/- TO SMT. ITA NO. 77 & 78/JP/2018 SMT. SANDHYA GUGALIA, JAIPUR VS DCIT,GHAZIABAD, UP 2 RAVINDRA HARNEJA, THE ASSESSEE DEPOSITED A SUM OF R S. 37,500/- VIDE CHALLAN- CUM-FORM 27Q ON 25.09.2013. THEREAFTER, INTIMATION U/S 200A WAS RECEIVED BY THE ASSESSEE ON 30.03.2015 ABOUT LEVY OF INTERES T OF RS. 2,250/- AND LATE FEES U/S 234E WHICH WAS RECTIFIED TO RS. 15,800/-IN RESPECT OF EACH OF TWO FILINGS. THE SAID LEVY OF INTEREST AND LATE PAYMENT FEE U/S 234E HAS SINCE BEEN CONFIRMED BY THE LD. CIT(A) AND HENCE THE ASSESSEE IS IN APPEAL BEFORE US. 3. DURING THE COURSE OF HEARING, THE LD. AR SUBMITT ED THAT AS PER SECTION 194IA, THE LIABILITY TO DEDUCT TDS IS APPLICABLE IF THE CONSIDERATION FOR TRANSFER OF ANY IMMOVABLE PROPERTY IS EQUAL TO OR GREATER TH AN RS. 50,000,00/-. IT WAS SUBMITTED IN THE INSTANT CASE, THE ASSESSEE HAS PAI D A SUM OF RS. 37,50,000/- TO SMT. RASHI HARNEJA WHICH IS LESS THAN RS. 50,000 ,00/-. SIMILARLY, THE ASSESSEE HAS PAID A SUM OF RS. 37,50,000/- TO SMT. RAVINDRA HARNEJA WHICH IS LESS THAN RS. 50,000,00/-. IT WAS ACCORDINGLY SUBM ITTED THAT THE PROVISIONS OF SECTION 194IA ARE NOT APPLICABLE IN THE CASE OF THE ASSESSEE. 4. IT WAS FURTHER SUBMITTED THAT MERELY BECAUSE THE ASSESSEE HAS DEDUCTED TDS BY MISTAKE, THE SAME CANNOT BE BASIS F OR LEVY OF INTEREST AND LATE FEE U/S 234E OF THE ACT. 5. IT WAS FURTHER SUBMITTED THAT LATE FEE U/S 234E IS NOT APPLICABLE BEFORE 01.06.2015. IT WAS SUBMITTED THAT THE AMENDMENT MAD E U/S 200A WHICH HAS COME INTO EFFECT ON 01.06.2015 HAS BEEN HELD BY THE COURTS TO HAVE PROSPECTIVE EFFECT, HENCE, NO COMPUTATION OF FEE CO ULD HAVE BEEN MADE FOR TDS DEDUCTED FOR ASSESSMENT YEAR PRIOR TO 01.06.201 5. IT WAS SUBMITTED THAT THE TRANSACTION OCCURRED ON 26.06.2013 AND INTIMATI ON U/S 200A WAS RECEIVED ON 30.03.2015 WHICH WAS PRIOR TO 01.06.2015. IN SUP PORT, RELIANCE WAS PLACED ON THE DECISION OF THE HONBLE KARNATAKA HIGH COURT IN CASE OF FATHERAJ SINGHVI & OTHERS VS. UNION OF INDIA IN WRIT APPEAL NO. 2663-2674/2015 (T-IT) DATED 26 TH AUGUST, 2016. ITA NO. 77 & 78/JP/2018 SMT. SANDHYA GUGALIA, JAIPUR VS DCIT,GHAZIABAD, UP 3 6. PER CONTRA, THE LD. DR HAS RELIED ON THE ORDER O F THE LD. CIT(A) AND SUBMITTED THAT THE TRANSFER VALUE OF THE IMMOVABLE PROPERTY IS RS. 75,000,00/- WHICH IS MORE THAN PRESCRIBED LIMIT, HE NCE SECTION 194IA IS CLEARLY APPLICABLE. FURTHER, SHE RELIED ON THE HONBLE RAJA STHAN HIGH COURT DECISION IN CASE OF M/S DUNDLOD SHIKSHAN SANSTHAN AND OTHERS VI DE ORDER DATED 28.07.2015 WHERE IT WAS HELD THAT EVEN PRIOR TO THE SE AMENDMENTS THE IMPOSITION OF FEES U/S 234E WAS NOT ILLEGAL. 7. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. IT IS AN UNDISPUTED FACT THAT THE ASSESS EE HAS ACQUIRED AN IMMOVEABLE PROPERTY WHICH WAS JOINTLY OWNED BY SMT. RASHI HARNEJA AND SMT. RAVINDRA HARNEJA. IT IS ALSO AN UNDISPUTED FA CT THAT THOUGH THE TOTAL CONSIDERATION WAS AGREED AT RS 75,00,000, THE ASSES SEE HAS PAID RS 37,50,000/- EACH TO THE TWO INDIVIDUAL AND JOIN T OWNERS OF THE SAID IMMOVEABLE PROPERTY. 8. SECTION 194-IA WHICH HAS BEEN INVOKED IN THE IN STANT CASE READS AS UNDER: PAYMENT ON TRANSFER OF CERTAIN IMMOVABLE PROPERTY OTHER THAN AGRICULTURAL LAND 194-IA. (1) ANY PERSON, BEING A TRANSFEREE, RESPONSIBLE FOR PAYING (OTHER THAN THE PERSON REFERRED TO IN SECTION 194LA) TO A RESIDENT TRANSFEROR ANY SUM BY WAY OF CONSIDERATION FOR TRANSFER OF ANY IMMOVABLE PROPERT Y (OTHER THAN AGRICULTURAL LAND), SHALL, AT THE TIME OF CREDIT OF SUCH SUM TO THE ACC OUNT OF THE TRANSFEROR OR AT THE TIME OF PAYMENT OF SUCH SUM IN CASH OR BY ISSUE OF A CHE QUE OR DRAFT OR BY ANY OTHER MODE, WHICHEVER IS EARLIER, DEDUCT AN AMOUNT EQUAL TO ONE PER CENT OF SUCH SUM AS INCOME-TAX THEREON. (2) NO DEDUCTION UNDER SUB-SECTION (1) SHALL BE MAD E WHERE THE CONSIDERATION FOR THE TRANSFER OF AN IMMOVABLE PROPERTY IS LESS THAN FIFT Y LAKH RUPEES. ITA NO. 77 & 78/JP/2018 SMT. SANDHYA GUGALIA, JAIPUR VS DCIT,GHAZIABAD, UP 4 (3) THE PROVISIONS OF SECTION 203A SHALL NOT APPLY TO A PERSON REQUIRED TO DEDUCT TAX IN ACCORDANCE WITH THE PROVISIONS OF THIS SECTION. EXPLANATION.FOR THE PURPOSES OF THIS SECTION, (A) 'AGRICULTURAL LAND' MEANS AGRICULTURAL LAND IN INDIA, N OT BEING A LAND SITUATE IN ANY AREA REFERRED TO IN ITEMS (A) AND (B) OF SUB-CLAUSE (III) OF CLAUSE (14 ) OF SECTION 2; (B) 'IMMOVABLE PROPERTY' MEANS ANY LAND (OTHER THAN AGRICUL TURAL LAND) OR ANY BUILDING OR PART OF A BUILDING. 9. A CLOSE READING OF THE ABOVE PROVISIONS PROVIDE S THAT ANY PERSON, BEING A TRANSFEREE, RESPONSIBLE FOR PAYING TO A RESIDENT TRANSFEROR ANY SUM BY WAY OF CONSIDERATION FOR TRANSFER OF ANY IMMOVABLE PROP ERTY SHALL, AT THE TIME OF CREDIT OF SUCH SUM TO THE ACCOUNT OF THE TRANSFEROR OR AT THE TIME OF PAYMENT OF SUCH SUM IN CASH OR BY ISSUE OF A CHEQUE OR DRAF T OR BY ANY OTHER MODE, WHICHEVER IS EARLIER, DEDUCT AN AMOUNT EQUAL TO ONE PER CENT OF SUCH SUM AS INCOME-TAX THEREON. IT HOWEVER, PROVIDES AN EXCEPTI ON THAT NO DEDUCTION UNDER SUB-SECTION (1) SHALL BE MADE WHERE THE CONSI DERATION FOR THE TRANSFER OF AN IMMOVABLE PROPERTY IS LESS THAN FIFTY LAKH RU PEES. IN OTHER WORDS, IT PROVIDES THAT ANY PERSON RESPONSIBLE FOR PAYING TO A RESIDENT TRANSFEROR ANY SUM BY WAY OF CONSIDERATION FOR TRANSFER OF ANY IMM OVABLE PROPERTY EXCEEDING RS 50 LACS, SHALL BE LIABLE FOR DEDUCTION OF TAX AT SOURCE AT THE RATE OF ONE PERCENT OF SUCH SUM. IN THE INSTANT CASE, E VEN THOUGH THE TOTAL CONSIDERATION FOR THE IMMOVABLE PROPERTY HAS BEEN A GREED AT RS 75,00,000, THE ASSESSEE IS RESPONSIBLE FOR PAYING CONSIDERATIO N OF RS 37,50,000 EACH TO SMT. RASHI HARNEJA AND SMT. RAVINDRA HARNEJA INDIVI DUALLY. IN FACT, THE ASSESSEE HAS ACTUALLY PAID RS 37,50,000 INDIVIDUALL Y TO THESE TWO INDIVIDUALS AS DEMONSTRATED BY ITS FILINGS IN FORM 27Q WHICH HA S BEEN ACCEPTED BY THE REVENUE AUTHORITIES AND SUBSEQUENTLY PROCESSED AND INTIMATION ISSUED UNDER SECTION 200A OF THE ACT. IN LIGHT OF THE SAME, IN OUR VIEW, THE PROVISIONS OF ITA NO. 77 & 78/JP/2018 SMT. SANDHYA GUGALIA, JAIPUR VS DCIT,GHAZIABAD, UP 5 SECTION 194-IA ARE NOT APPLICABLE IN THE INSTANT CA SE. GIVEN THAT THE PROVISIONS OF SECTION 194-IA ARE NOT ATTRACTED, THE RE IS NO BASIS FOR LEVY OF INTEREST AND LATE FEE UNDER SECTION 234E OF THE ACT AND THE DEMAND SO RAISED IS HEREBY DIRECTED TO BE DELETED. HOWEVER, WE MAKE IT CLEAR THAT TDS ALREADY DEPOSITED SHALL NOT BE REFUNDED TO THE ASSE SSEE AS THE TRANSFEROR WOULD BE ENTITLED TO CLAIM CREDIT OF THE SAME IN TH EIR RESPECTIVE RETURN OF INCOME. IN THE RESULT, BOTH THE APPEALS OF THE ASSESSEE ARE ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 08/06/2018. SD/- SD/- FOT; IKWY JKO FOE FLAG ;KNO (VIJAY PAL RAO) (VIKRAM SINGH YADAV) U;KF;D LNL;@ JUDICIAL MEMBER YS[KK LNL;@ ACCOUNTANT MEMBER JAIPUR DATED:- 08/06/2018 *GANESH KR VKNS'K DH IZFRFYFI VXZSF'KR @ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ@ THE APPELLANT - SMT. SANDHYA GUGALIA, JAIPUR 2. IZR;FKHZ@ THE RESPONDENT - DCIT, GHAZIABAD, UP 3. VK;DJ VK;QDR@ CIT 4. VK;DJ VK;QDRVIHY@ THE CIT(A) 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ@ DR, ITAT, JAIPUR 6. XKMZ QKBZY@ GUARD FILE (ITA NO. 77 & 78 /JP/2018 ) VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASSISTANT. REGISTRAR. ITA NO. 77 & 78/JP/2018 SMT. SANDHYA GUGALIA, JAIPUR VS DCIT,GHAZIABAD, UP 6