ACIT 25(3), MUMBAI V. BHAVARLAL C. SUTHAR, MUMBAI

ITA 7840/MUM/2010

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 3962 (ITAT-MUMBAI)
• Duration Of Justice: 5 year(s) 3 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-02-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 15-02-2016
• Assessment Year: 2007-2008
• Appeal Filed On: 12-11-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Charitable institution; Additional evidence
• Section: 143(3); 80G

Judgement Text

, , , IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES B, MUMBAI , , , BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER, AND SHRI SANJAY ARORA, ACCOUNTANT MEMBER ITA NO.7840/MUM/2010 ASSESSMENT YEARS:2007-08 ACIT-25(3), C-11, R. NO.308, PRATYAKSH KAR BHAVAN, BANDRA KURLA COMPLEX, BANDRA (EAST), MUMBAI-400051 SHRI BHAVARLAL C.SUTHAR C/4/705, SAI KRUPA CHSL, SECTOR-7, KANDIVALI (WEST), MUMBAI-400067 ( / REVENUE) ( !'# $ /ASSESSEE) PAN. NO. AAOPS8548P % & ' $ ( / DATE OF HEARING : 15/02/2016 ' $ ( / DATE OF ORDER: 29/02/2016 / O R D E R PER JOGINDER SINGH (JUDICIAL MEMBER) THE REVENUE IS AGGRIEVED BY THE IMPUGNED ORDER DATE D 20/08/2010, OF THE LD. FIRST APPELLATE AUTHORITY, M UMBAI, ON / REVENUE BY SHRI PRAKASH L. PATHADE !'# $ / ASSESSEE BY NONE ITA NO.7840/MUM/2010 BHAVARLAL C.SUTHAR 2 THE GROUND THAT THE LD. COMMISSIONER OF INCOME TAX (APPEALS) ERRED IN DELETING THE ADDITION OF RS.64,1 6,212/- WITHOUT APPRECIATING THE PROVISIONS OF SECTION 40(A )(IA) OF THE ACT AND FURTHER ERRED IN ALLOWING DEDUCTION OF RS.2 5,500/-, ACCEPTING ADDITIONAL EVIDENCE WITHOUT SEEKING REMAN D REPORT FROM THE ASSESSING OFFICER. 2. DURING HEARING OF THIS APPEAL, SHRI PRAKASH L. PATHADE, LD. DR, ADVANCED ARGUMENTS WHICH IS IDENTI CAL TO THE GROUND RAISED. ON THE OTHER HAND, NOBODY WAS PRESE NT FOR THE ASSESSEE IN SPITE OF ISSUANCE OF REGISTERED NOTICES ON VARIOUS DATES. EVEN ON 20/09/2012, THE HEARING WAS ADJOURNE D AT THE REQUEST OF THE ASSESSEE. IT SEEMS THAT THE ASSESSEE IS NOT INTERESTED TO RESPOND, THEREFORE, WE HAVE NO OPTION BUT TO PROCEED EX-PARTE, QUA THE ASSESSEE, AND TEND TO DIS POSE OF THIS APPEAL ON THE BASIS OF MATERIAL AVAILABLE ON RECORD . 2.1. WE HAVE CONSIDERED THE SUBMISSIONS OF THE LD. DR AND PERUSED THE MATERIAL AVAILABLE ON RECORD. THE F ACTS, IN BRIEF, ARE THAT THE ASSESSEE, AN INDIVIDUAL, ENGAGE D IN CARPENTRY CONTRACT WORK, DECLARED INCOME OF RS.10,2 2,327/- IN HIS RETURN FILED ON 03/10/2007, ACCEPTING THE SAME U/S 143(1) OF THE ACT. CASE OF THE ASSESSEE, SUBSEQUENT LY, WAS SELECTED FOR SCRUTINY, AND THE ASSESSMENT WAS COMPL ETED U/S 143(3) OF THE ACT DETERMINING THE TOTAL INCOME AT RS.1,09,02,510/-. THE LD. ASSESSING OFFICER NOTED T HAT THE ASSESSEE DID NOT DEDUCT TAX AT SOURCE IN RESPECT OF PAYMENTS MADE TO LABOUR CONTRACTORS TO THE EXTENT OF RS.97,9 2,917/- AS REQUIRED U/S 194C(2) OF THE ACT. BEFORE THE LD. ASS ESSING ITA NO.7840/MUM/2010 BHAVARLAL C.SUTHAR 3 OFFICER AS WELL AS BEFORE THE LD. COMMISSIONER OF I NCOME TAX (APPEALS), THE EXPLANATION OF THE ASSESSEE IS THAT THE ASSESSEE DULY DEDUCTED THE TAX AT SOURCE AND DEPOSITED IN TH E GOVERNMENT ACCOUNT IN SUBSEQUENT YEAR. IT WAS ALSO ASSERTED THAT THE RESPECTIVE PARTIES PAID THEIR TAXES, THERE FORE, THERE WAS NO LIABILITY TO DEDUCT TAX BY THE ASSESSEE. REL IANCE WAS PLACED UPON THE DECISION IN HINDUSTAN COCA COLA BEV ERAGES (P.) LTD. 293 ITR 226 (SC) BY CONTENDING THAT SECTI ON 40(A)(IA) OF THE ACT IS NOT APPLICABLE. WITHOUT GOING INTO M UCH DELIBERATION, IT IS NOTED THAT THE REQUIREMENT OF T HE ACT IS THAT THE TAXES HAS TO BE PAID AND DEDUCTION OF TAX IS ON E OF THE MODE OF PAYMENT. UNDISPUTEDLY, TAX HAS ALREADY BEE N RECOVERED/PAID EITHER BY THE ASSESSEE OR BY THE REC IPIENT, THEREFORE, THERE IS NO LOSS OF THE REVENUE. THE ASS ESSEE DEBITED LABOUR CHARGES OF RS.97,92,917/- TO THE PRO FIT & LOSS ACCOUNT OUT OF THE WHICH THE AMOUNT OF RS.64,16,212 /- WAS DEBITED BEFORE THE END OF FEBRUARY 2007 AND RS.33,7 6,705/- WAS DEBITED IN THE MONTH OF MARCH 2007. THE ASSESSE E PAID THE AMOUNT OF RS.64,16,212/- BEFORE THE END OF THE PREVIOUS YEAR AND THE ASSESSEE DEDUCTED TDS IN RESPECT OF AL L THE AMOUNT TOWARDS LABOUR CHARGES AND REMITTED INTO THE GOVERNMENT ACCOUNT ON 07/08/2007 I.E. BEFORE DUE DA TE OF FILING OF RETURN. IN VIEW OF THIS FACTUAL MATRIX, W E FIND NO INFIRMITY IN THE CONCLUSION OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS), CONSEQUENTLY, THERE WAS NO QUESTION OF DISALLOWING RS.33,76,705/- IGNORING THE RETROSPECTI VE AMENDMENT MADE BY THE FINANCE ACT, 2008. ITA NO.7840/MUM/2010 BHAVARLAL C.SUTHAR 4 2.2. SO FAR AS, THE BALANCE AMOUNT OF RS.64,16,212 /- IS CONCERNED, BEFORE THE LD. COMMISSIONER OF INCOME TA X (APPEALS), IT WAS THE PLEA OF THE ASSESSEE THAT THE ASSESSEE HAS NOT AWARDED ANY SUB-CONTRACT, THEREFORE, SECTION 19 4C(2) IS NOT APPLICABLE AS THE ASSESSEE WAS SOLELY RESPONSIB LE FOR EXECUTION OF WORK TO THE PRINCIPAL AS NO PART OF TH E WORK WAS SUB-CONTRACTED. EVEN IF IT IS PRESUMED THAT THE ASS ESSEE ENTERED INTO A ORAL CONTRACT FOR SUPPLY OF LABOUR S TILL IT CANNOT BE BROUGHT WITHIN AMBIT OF SECTION 194C(1) AS THE P ROVISION IS APPLICABLE ONLY FROM 01/06/2007, THUS, THE ASSESSEE WAS NOT LIABLE TO DEDUCT TAX, THEREFORE, THERE IS NO QUESTI ON OF DISALLOWANCE OF THE IMPUGNED AMOUNT. IT IS ALSO N OTED THAT THE LD. COMMISSIONER OF INCOME TAX (APPEALS) HAS AL READY RELIED UPON THE DECISION OF THE TRIBUNAL IN THE CAS E OF TEJA CONSTRUCTION VS ACIT (36 DTR 220)(HYD. ITAT) AND AN OTHER DECISION OF THE JAIPUR BENCH OF THE TRIBUNAL IN JAI PUR VIDYUT VITRAN NIGAM LTD. VS DCIT (26 DTR 79), IN WHICH THE DECISION FROM HONBLE APEX COURT IN CIT VS MOTHER INDIA REFR IGERATION PVT. LTD. 48 CTR (SC) 176; 155 ITR 711 (SC) AND CBD T CIRCULAR NO.5 OF 2005 DATED 15/07/2005 (2005) 197 C TR (ST.) 1 HAS BEEN DISCUSSED. TOTALITY OF FACTS CLEARLY IN DICATES THAT SINCE THE AMOUNT HAD ALREADY BEEN PAID DURING THE Y EAR, THEREFORE, SECTION 40(A)(IA) OF THE ACT IS NOT ATTR ACTED. IN VIEW OF THESE FACTS, WE AFFIRM THE STAND OF THE LD. COMMISS IONER OF INCOME TAX (APPEALS). 2.3. SO FAR AS, THE CLAIMED DEDUCTION OF RS.25,500 /- U/S 80G OF THE ACT IS CONCERNED, THE ASSESSEE PAID RS.5 1,000 TO A ITA NO.7840/MUM/2010 BHAVARLAL C.SUTHAR 5 CHARITABLE TRUST NAMELY SHREE VISHWAKARMA CHARITABL E TRUST. THE DEDUCTION WAS DISALLOWED ON THE PLEA THAT THE E XEMPTION WAS VALID UPTO 31/03/2006, HOWEVER, BEFORE THE LD. COMMISSIONER OF INCOME TAX (APPEALS), IT WAS EXPLAI NED THAT THE APPROVAL U/S 80G WAS EXTENDED BY THE LD. DIT(E) TILL 31/03/2009. IN VIEW OF THIS FACTUAL MATRIX, WE AFFI RM THE STAND OF THE LD. COMMISSIONER OF INCOME TAX (APPEAL S). FINALLY, THE APPEAL OF THE REVENUE IS HAVING NO MER IT, CONSEQUENTLY, DISMISSED. THIS ORDER WAS PRONOUNCED IN THE OPEN COURT IN THE PRESENCE OF LD. DR AT THE CONCLUSION OF THE HEARING ON 15/02/2016. SD/- SD/- ( SANJAY ARORA ) (JOGINDER SINGH) ! ' / ACCOUNTANT MEMBER # ' /JUDICIAL MEMBER % & MUMBAI; ) DATED : 29/02/2016 F{X~{T? P.S/. . . $#%&'(')% / COPY OF THE ORDER FORWARDED TO : 1. +,- / THE APPELLANT 2. ./,- / THE RESPONDENT. 3. 0 0 % 1$ ( + ) / THE CIT, MUMBAI. 4. 0 0 % 1$ / CIT(A)- , MUMBAI 5. 34 .$ ! , 0 +( ! 5 , % & / DR, ITAT, MUMBAI 6. ' 7& / GUARD FILE. / BY ORDER, /3+$ .$ //TRUE COPY// / (DY./ASSTT. REGISTRAR) , % & / ITAT, MUMBAI