Walvekar Sons, Pune V. Income-tax Officer, Ward - 3(2), Pune

ITA 771/PUN/2018

• Counselvise Citation: [2018] 118 COUNSELVISE.COM (IT) 9680 (ITAT-PUNE)
• Duration Of Justice: 7 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-12-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2013-2014
• Appeal Filed On: 27-04-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: M K VERMA
• Section: 205

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH SMC, PUNE BEFORE SHRI R.S. SYAL, VICE PRESIDENT . / ITA NO.771/PUN/2018 / ASSESSMENT YEAR : 2013-14 WALVEKAR SONS, 1, DWARAKA APARTMENT, HKM ROAD, OPPO. CENTRAL MALL, MODEL COLONY, PUNE-411 016. PAN : AAAFW7084Q .... / APPELLANT / V/S. THE INCOME TAX OFFICER, WARD 3(2), PUNE. / RESPONDENT ASSESSEE BY : SHRI M.K. KULKARNI REVENUE BY : SHRI M.K. VERMA / DATE OF HEARING : 13.12.2018 ! / DATE OF PRONOUNCEMENT : 13.12.2018 / ORDER PER R.S. SYAL, VP : THIS APPEAL BY THE ASSESSEE ARISES OUT OF THE ORDER PASSED BY THE CIT (APPEALS)-3, PUNE ON 07.02.2018 IN RELATION TO THE ASSESSMENT YEAR 2013-14. 2. THIS APPEAL WAS FILED BELATEDLY BY 3 DAYS. THE A SSESSEE HAS FILED AN AFFIDAVIT GIVING REASONS FOR THE DELAY. THE REASON S ASCRIBED FOR THE DELAY 2 ITA NO. 771/PUN/2018 A.Y.2013-14 ARE SATISFACTORY. I, THEREFORE, CONDONE THE DELAY A ND ADMIT THE APPEAL FOR HEARING ON MERITS. 3. THE ASSESSEE IS AGGRIEVED BY NOT ALLOWING CREDIT FOR TAX COLLECTED AT SOURCE AGAINST THE TAX DUE ON TOTAL INCOME. 4. BRIEFLY STATED, THE FACTS OF THE CASE ARE THAT T HE ASSESSEE IS A PARTNERSHIP FIRM ENGAGED IN THE BUSINESS OF IMFL PR ODUCTS, INCLUDING WINES AND BEERS FOR MANY LIQUOR AND BEER MANUFACTUR ING COMPANIES. THE ASSESSEE FURNISHED RETURN DECLARING TOTAL INCOM E AT RS.23,70,003/-. THE ASSESSING OFFICER COMPLETED THE ASSESSMENT BY A SSESSING THE TOTAL INCOME AT THE SAME LEVEL, BUT DID NOT ALLOW THE BEN EFIT OF TCS AGAINST THE AMOUNT OF TAX DUE ON TOTAL INCOME. THE ASSESSEE CON TENDED BEFORE THE LD. CIT(APPEALS)-3 THAT BENEFIT OF TDS/TCS AMOUNTING TO RS.7,41,781/- SHOULD BE ALLOWED AGAINST TAX LIABILITY OF RS.7,32, 330/- AND THE REFUND OF RS.9,450/- BE GRANTED. THE LD. CIT(APPEALS) OBSERVE D THAT ONE SUPPLIER, NAMELY, M/S. CROMEX LIQUORS PVT. LTD., FROM WHOM TH E ASSESSEE HAD PURCHASED LIQUOR DURING THE YEAR UNDER CONSIDERATI ON, COLLECTED TAX AT SOURCE TO THE TUNE OF RS.6,37,931/-, BUT DID NOT DE POSIT THE SAME IN THE GOVERNMENT ACCOUNT. HE, THEREFORE, DENIED THE BENEF IT OF SUCH TAX CREDIT. THE ASSESSEE IS AGGRIEVED BY THE DECISION OF CIT(A) ON THIS SCORE. 5. I HAVE HEARD BOTH THE PARTIES AND PERUSED THE RE LEVANT MATERIAL AVAILABLE ON RECORD. IT IS AN UNDISPUTED POSITION THAT M/S. CROMEX LIQUORS PVT. LTD. COLLECTED TAX AT SOURCE FROM THE ASSESSEE AMOUNTING TO RS.6,37,931/- BUT DID NOT DEPOSIT THE SAME IN THE G OVERNMENT 3 ITA NO. 771/PUN/2018 A.Y.2013-14 EXCHEQUER. THE MOOT ISSUE IS AS TO WHETHER THE BEN EFIT OF TAX COLLECTED AT SOURCE SHOULD BE ALLOWED TO THE ASSESSEE UNDER SUCH CIRCUMSTANCES. IN MY VIEW, THE LOWER AUTHORITIES ERRED IN DENYING THE BENEFIT OF TAX COLLECTED AT SOURCE FROM THE ASSESSEE BY M/S. CROME X LIQUOR PVT. LTD. TO THE EXTENT OF RS.6,37,931/-. THE ASSESSING OFFICER, IN THE REMAND REPORT, HAS FAIRLY ADMITTED THAT TAX OF SUCH A MAGNITUDE WA S IN FACT, COLLECTED AGAINST THE SUPPLIES MADE TO THE ASSESSEE. THE BEN EFIT OF TAX CREDIT WAS DENIED ONLY ON THE GROUND THAT M/S. CROMEX LIQUOR P VT. LTD. DID NOT DEPOSIT THE AMOUNT OF TAX COLLECTED AT SOURCE IN TH E GOVERNMENT ACCOUNT. 6. I FAIL TO COMPREHEND AS TO HOW THE ASSESSEE CAN BE CALLED UPON TO PAY THE AMOUNT OF SUCH TAX AGAIN, WHEN IT WAS LAWFU LLY COLLECTED AT SOURCE BY SOMEONE ON BEHALF OF GOVERNMENT OF INDIA. IF THE COLLECTOR HAS NOT DEPOSITED THE AMOUNT, AFTER DUE DEDUCTION, IT I S SUCH A TAX COLLECTOR WHO SHOULD BE HELD RESPONSIBLE FOR HIS DEFAULT. UN DER NO CIRCUMSTANCE, THE DEPARTMENT CAN PRESS THE ASSESSEE TO NOT TAKE C REDIT FOR THE AMOUNT OF TAX LEGITIMATELY COLLECTED TAX AT SOURCE FROM IT . SECTION 205 OF THE ACT CLEARLY PROVIDES THAT WHERE TAX IS DEDUCTABLE AT T HE SOURCE UNDER THE FOREGOING PROVISIONS OF THIS CHAPTER, THE ASSESSEE SHALL NOT BE CALLED UPON TO PAY THE TAX HIMSELF TO THE EXTENT TO WHICH TAX HAS BEEN DEDUCTED FROM THAT INCOME. IT IS, THEREFORE, ABUNDANTLY C LEAR THAT THE INCOME-TAX ACT ITSELF CARRIES A BAR AGAINST RECOVERY OF ANY T AX DEDUCTED/COLLECTED AT SOURCE FROM THE ASSESSEE WHERE IT HAS BEEN ACTUALLY DEDUCTED/COLLECTED AT SOURCE. IN VIEW OF THE FOREGOING DISCUSSION, I A M UNABLE TO SUSTAIN THE VIEW CANVASSED BY THE AUTHORITIES BELOW IN NOT ALLO WING CREDIT FOR TAX COLLECTED AT SOURCE BY M/S. CROMEX LIQUORS PVT. LTD . FROM THE ASSESSEE 4 ITA NO. 771/PUN/2018 A.Y.2013-14 MERELY ON THE GROUND THAT SUCH COLLECTED TAX AT SOU RCE AMOUNT DID NOT GET DEPOSITED IN THE GOVERNMENT ACCOUNT. I, THEREF ORE, OVERTURN THE IMPUGNED ORDER AND DIRECT THE ASSESSING OFFICER TO GRANT ADJUSTMENT OF SUCH TAX COLLECTED AT SOURCE AGAINST THE TAX LIABIL ITY OF THE ASSESSEE. 7. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED . ORDER PRONOUNCED ON 13 TH DAY OF DECEMBER, 2018. SD/- R.S. SYAL /VICE-PRESIDENT ' / PUNE; #$ / DATED : 13 TH DECEMBER, 2018. SB / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT. 2. / THE RESPONDENT. 3. THE CIT (APPEALS)-3, PUNE. 4. THE PR. CIT-2, PUNE. 5. &'( ) , ) , - * + , , ' / DR, ITAT, SMC BENCH, PUNE. 6. (- ./ / GUARD FILE. // TRUE COPY // $'0 / BY ORDER, 1 ), / PRIVATE SECRETARY ) , ' / ITAT, PUNE. 5 ITA NO. 771/PUN/2018 A.Y.2013-14 * DATE 1 DRAFT DICTATED ON 1 3 .12.2018 SR. PS/PS 2 DRAFT PLACED BEFORE AUTHOR 13 .12.2018 SR. PS/PS 3 DRAFT PROPOSED AND PLACED BEFORE THE SECOND MEMBER JM/AM 4 DRAFT DISCUSSED/APPROVED BY SECOND MEMBER AM/JM 5 APPROVED DRAFT COMES TO THE SR. PS/PS SR. PS/PS 6 KEPT FOR PRONOUNCEMENT ON SR. PS/PS 7 DATE OF UPLOADING OF ORDER SR. PS/PS 8 FILE SENT TO BENCH CLERK SR. PS/PS 9 DATE ON WHICH THE FILE GOES TO THE HEAD CLERK 10 DATE ON WHICH FILE GOES TO THE A.R 11 DATE OF DISPATCH OF ORDER