M/s. Odion Builders and Developers, Bangalore V. The Income Tax Officer (TDS) - Ward - 2(3), Bangalore

ITA 807/BANG/2019

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 6851 (ITAT-BANGALORE)
• Duration Of Justice: 3 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-07-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Assessment Year: 2014-2015
• Appeal Filed On: 16-04-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DR S PALANI KUMAR
• Assessee Lawyers: G N BHATT
• Keywords: Salary income; Reasonable cause; Non passing of speaking order; Condonation of delay; TDS; Set aside
• Section: 80C; 143(3); 133A; 201(1); 250; 6; 2; 15

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL BANGALORE BENCHES C BENCH: BANGALORE BEFORE SHRI A.K. GARODIA, ACCOUNTANT MEMBER AND SHRI PAVAN KUMAR GADALE, JUDICIAL MEMBER ITA. NO S . 807 TO 810 /BANG/201 9 (ASSESSMENT YEAR S: 201 4 - 15 TO 2017 - 18 ) M/S. ODION BUILDERS & DEVELOPERS, NO.1556 & 1557, 19 TH MAIN ROAD, HSR LAYOUT, SECTOR 1, BENGALURU 560 102 PAN: AACFO 7322D VS. INCOME TAX OFFICER (TDS) , WARD 2(3), BANGALORE. (APPELLANT) (RESPONDENT) ASSESSEE BY: SHRI G. N. BHATT, C.A. REVENUE BY: DR. S. PALANI KUMAR, ADDL. CIT (D.R) DATE OF HEARING : 24.07 .2019 DATE OF PRONOUNCEMENT : 29 .07 .2019 O R D E R PER SHRI PAVAN KUMAR GADALE, JM : THESE ARE THE APPEALS FILED BY THE ASSESSEE AGAINST DIFFERENT ORDERS OF THE CIT(APPEALS) PASSED UNDER SECTION 201(1), 201(1A) AND 250 OF THE INCOME TAX ACT, 1961. SINCE ALL THE APPEALS ARE FILED BY THE ASSESSEE FOR DIFFERENT ASSESSMENT YEARS WHERE THE ISSUES ARE COMMON AND IDENTICAL, THEY ARE HEARD TOGETHER AND CONSOLIDATED ORDER IS PASSED. FOR THE SAKE OF CONVENIENCE, WE 2 ITA NO S . 807 TO 810/BANG/2019 SHALL TAKE UP ITA NO.807/BANG/2019 FOR THE ASSESSMENT YEAR 2014 - 15 AND THE FACTS NARRATED THEREIN. 2. THE ASSESSEE HAS RAI SED THE FOLLOWING GROUNDS OF APPEAL : 3. THE ASSESSEE IS A PARTNERSHIP FIRM ENGAGED IN THE BUSINESS OF PROPERTY DEVELOP MENT AND REAL ESTATE SECTOR. THERE WAS A SURVEY OPERATION UNDER SECTION 133A OF THE ACT AT THE BUSINESS PREMISES 3 ITA NO S . 807 TO 810/BANG/2019 OF THE ASS ESSEE'S FIRM ON 12.7.2016 TO VERIFY THE COMPLIANCE OF TDS PROVISIONS. THE ASSESSING OFFICER ON VERIFYING THE FACTS AND THE INFORMATION AND DEALT O N THE PROVISIONS OF SECTION 194I A OF THE ACT AND FOUND THAT THE ASSESSEE HAS NOT DEDUCTED TDS ON PAYMENTS AND RAISED DEMAND UNDER SECTION 201(1) AND 201(1A) OF THE ACT ON NON - COMPLIANCE OF PROVISIONS OF SECTION 194LA AND DETERMINED TOTAL DEMAND PAYABLE OF RS.91,487. AGGRIEVED BY THE ORDER, THE ASSESSEE HAS FILED AN APPEAL WITH THE CIT(APPEALS). THE CIT(APPEALS ) BEFORE GOING INTO MERITS OF THE CASE FOUND THAT THERE IS A DELAY OF 215 DAYS IN FILING THE APPEAL, SINCE THE EXPLANATIONS OF THE ASSESSEE ARE NOT SATISFACTORY CIT (APPEALS) HAS NOT CONDONED THE DELAY IN FILING THE APPEAL AND DISMISSED THE ASSESSEE'S AP PEAL. AGGRIEVED BY THE ORDER OF CIT(APPEALS), THE ASSESSEE HAS FILED AN APPEAL WITH THE TRIBUNAL. 4. AT THE TIME OF HEARING, THE LEARNED AUTHORISED REPRESENTATIVE RESTRICTED HIS ARGUMENTS AND SUBMISSIONS IN RESPECT OF CONDONATION OF DELAY ONL Y T H A T THE CIT(APPEALS) HAS NOT CONSIDERED THE ASSESSEE'S SUBMISSIONS ON DELAY IN FILING THE APPEAL AND OVERLOOKED THE AFFIDAVIT FILED BY THE ASSESSEE AND THE LD. AR SUBMITTED THAT THE CIRCUMSTANCES WERE BEYOND THE ASSESSEE'S CONTROL . HENCE DELAY IN FILING THE APPEAL AND PRAYED FOR CONDONATION OF DELAY OF 215 DAYS AND ALSO PROVIDE ONE MORE OPPORTUNITY BEFORE THE CIT(APPEALS) TO SUBSTANTIATE THE CASE AND SUPPORTED WITH JUDICIAL DECISIONS. CONTRA, THE LEARNED DEPARTMENTAL REPRESENTATIVE SUPPORTED THE O RDERS OF CIT (APPEALS). 4 ITA NO S . 807 TO 810/BANG/2019 5. WE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIAL ON RECORD. THE SOLE MATRIX OF THE DISPUTED ISSUE IS ON THE CONDONATION OF DELAY WHICH WAS REJECTED BY THE CIT(APPEALS). THE LEARNED AUTHORISED REPRESENTATIVE SUBM ITTED THAT THERE IS A DELAY OF 215 DAYS IN FILING THE APPEAL BEFORE THE APPELLATE AUTHORITIES AND ALSO EXPLANATIONS WERE FILED IN THE APPELLATE PROCEEDINGS WHEREAS CIT (APPEALS) HAS REJECTED THE SUBMISSIONS AND DELAY WAS NOT CONDONED. WE FOUND THAT THE CI T(APPEALS) HAS RELIED ON THE JUDICIAL DECISIONS AND IS OF THE OPINION THAT THERE IS NO SUFFICIENT CAUSE FOR CONDONING THE DELAY WHEREAS THE LEARNED AUTHORISED REPR ESENTATIVE EMPHASIZED THAT THE ASSESSEE HAS A REASONABLE CAUSE FOR NOT FILING THE APPEAL WITH IN THE TIME LIMIT SPECIFIED UNDER THE ACT. WE FIND THE APPEAL HAS TO BE FILED ON OR BEFORE 30.04.2017 BUT THE ASSESSEE HAS FILED THE APPEAL ON 1.12.2017, WE CONSIDER IT APPROPRIATE TO REFER TO THE P E T I T I O N FILED BY THE ASSESSEE PLACED AT PARA 4 ON PAGE 3 OF THE CIT(APPEALS) ORDER AS UNDER : 5 ITA NO S . 807 TO 810/BANG/2019 WE CONSIDERING THE SUBMISSIONS OF THE LEARNED AUTHORISED REP RESENTATIVE AND THE CONDONATION PETITION FILED BEFORE THE CIT(APPEALS) ARE OF THE OPINION THAT THE ASSESSEE SHALL NOT GAIN BY DELAYING IN FILING THE APPEAL AND SUPPORT OUR VIEW RELYING ON THE FOLLOWING DECISIONS -- I) COLLECTOR, LAND ACQUISITION VS. MST. KATIJI & OTHERS (1987) 167 ITR 471 (SC). II) ANUPAM BISWAS VS. ITO (2016) 157 ITD 0445 . III) YUVRAJ MAHAJAN VS. ITO (2016) 46 CCH 0311 (CHANDIGARH TRIB.) 6 ITA NO S . 807 TO 810/BANG/2019 IV) S S M AHMED HUSSAIN & OTHERS VS. ITO47 CCH 0208 (CHENNAI TRIB.) V) VEMI REDDY YASHODAR REDDY VS. ITO (2017) 51 CCH 0293 (BANG) (ITA NO.953/BANG/2017 DT.27.09.2017) WE FIND IN THE CASE OF VEMI REDDY YASHODAR REDDY VS. ITO (SUPRA) WHERE THE CO - ORDINATE BENCH HAS DEALT ON THE DECISION OF THIRD MEMBER RELIED BY THE CIT(APPEALS) AND WE CONSIDER IT APPROPRIATE TO REFER TO THESE SUBMISSIONS AS UNDER AT PARAS 4.4.1 TO 4.4.4 : 4.4.1 WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED AND CAREFULLY CONSIDERED THE MATERIAL ON RECORD. WE FIND THAT WHILE THE REASONS PUT FORTH BY THE ASSESSEE FOR THE DELAY OF 323 DAYS IN FILING THE APPEAL BEFORE THE LD CIT(A) FIND MENTION IN THE IMPUGNED ORDER, THE LD CIT(A) HAS REJECTED THE ASSESSEES EXPLANAT IONS FOR THE SAID DELAY WITHOUT CONTROVERTING THE FACTS AS PER THE EXPLANATIONS PUT FORTH BY THE ASSESSEE. THE UNDISPUTED FACTS ARE THAT THE ASSESSEE IS AN INDIVIDUAL MAINLY DERIVING INCOME FROM SALARY. IT APPEARS TO US, FROM A CAREFUL PERUSAL OF THE ASSES SEES SUBMISSIONS IN RESPECT OF THE DELAY IN FILING THE APPEAL BEFORE THE CIT(A), THAT THE ASSESSEE WAS NOT AWARE OF THE SUBSEQUENT LEGAL STEPS TO BE TAKEN AFTER RECEIPT OF THE ADVERSE ORDER OF ASSESSMENT U/S 143(3) OF THE ACT FOR ASST. YEAR 2010 - 11. IT D OES NOT STAND TO REASON THAT ANY MAN WOULD INTENTIONALLY JEOPARDIZE HIS OWN CASE BY DELIBERATELY FILING THE APPEAL BELATEDLY; MORE SO WHEN HIS INCOME WAS DETERMINED AT RS.51,73,610/ - , ALMOST 3 TIMES MORE THAN HIS RETURNED INCOME OF RS.18,67,220/ - , RESULTIN G IN TAX DEMAND OF RS.14,81,440/ - BEING RAISED. FURTHER, AS SEEN FROM THE ORDER OF ASSESSMENT AND AS CONTENDED BY THE ASSESSEE, THE ADDITIONS/DISALLOWANCES MADE BY THE AO I.E DISALLOWANCE OF INTEREST ON REPAYMENT OF HOUSING LOAN; DISALLOWANCE OF DEDUCTION U/S 80C OF THE ACT, CREDIT CARD PAYMENT, CASH DEPOSITS AND DIFFERENT IN 26AS AS REGARDS TO GROSS RECEIPTS ARE BASICALLY FACTUAL IN NATURE AND CAN BE EXAMINED AND VERIFIED. WE ALSO NOTICE THAT THE ORDER OF ASSESSMENT CLEARLY EVIDENCES THAT THE ISSUES ON WHI CH ADDITIONS/DISALLOWANCES HAVE BEEN MADE, HAVE NEITHER BEEN DISCUSSED NOR HAS ANY REASONED FINDING/SPEAKING ORDER BEEN RENDERED BY THE AO ON ANY ISSUE IN THE ORDER OF ASSESSMENT. ON APPEAL ALSO, THE LD CIT(A) WITHOUT GOING INTO AND EXAMINING THE MERITS OF THE VARIOUS GROUNDS RAISED BY THE ASSESSEE ON THE AFORESAID DISALLOWANCES/ADDITIONS HAS DISMISSED THE ASSESSEES APPEAL IN LIMINE BY DECLINING TO CONDONE THE DELAY IN FILING THE APPEAL. 4.4.2 THE HONBLE APEX COURT IN THE CASE OF MST. KATIJI AND OTHERS ( SUPRA) HAS LAID DOWN THE PRINCIPLES FOR EXAMINING PETITIONS FOR CONDONATION OF DELAY IN FILING APPEALS, I.E, THAT SUBSTANTIAL JUSTICES SHOULD PREVAIL OVER TECHNICAL CONSIDERATIONS. IT 7 ITA NO S . 807 TO 810/BANG/2019 IS SETTLED POSITION THAT WHILE CONFIRMING SUFFICIENT CAUSE THE COURT S HOULD TAKE A LIBERAL VIEW IN THE INTEREST OF SUBSTANTIAL JUSTICE, ESPECIALLY WHERE IT IS FOUND THAT THE PARTIES HAVE NOT ACTED WITH MALAFIDE INTENTIONS AND THE REASONS/EXPLANATIONS PUT FORTH ARE SATISFACTORY. IN THE CASE ON HAND, THE FACTUAL EXPLANATION PU T FORTH BY THE ASSESSEE AS THE REASONS FOR DELAY IN FILING THE APPEAL HAVE NOT BEEN CONTROVERTED BY REVENUE, THOUGH THE LD CIT(A) DID NOT FIND THAT SAME SUFFICIENT ENOUGH TO CONDONE THE DELAY. IN OUR VIEW, AFTER A CAREFUL PERUSAL OF THE EXPLANATIONS PUT FO RTH FOR DELAY IN FILING THE APPEAL, WE FIND THAT THE ASSESSEES DEFAULT IS NEITHER INTENTIONAL NOR MALAFIDE, AS BY FILING THE APPEAL BELATEDLY THE ASSESSEE DID NOT STAND TO BENEFIT. IN THE FACTUAL AND LEGAL MATRIX OF THE CASE, WE ARE OF THE CONSIDERED OPIN ION THAT THE ASSESSES EXPLANATION PUT FORTH ESTABLISH SUFFICIENT CAUSE FOR THE DELAY OF 323 DAYS IN FILING THE APPEAL BEFORE THE CIT(A). IN THIS VIEW OF THE MATTER AND RESPECTFULLY FOLLOWING THE RATIO OF THE DECISION OF THE HONBLE APEX COURT IN THE CASE OF MST. KATIJI & OTHERS (SUPRA), WE ARE OF THE OPINION THAT THIS IS A FIT CASE FOR CONDONATION OF DELAY AND CONDONE THE DELAY OF 323 DAYS IN FILING THE APPEAL FOR ASST. YEAR 2010 - 11 BEFORE THE LD CIT(A). 4.4.3 WE HAVE CAREFULLY PERUSED THE DECISION OF TH E HONBLE APEX COURT IN THE CASE OF BRIJESH KUMAR & OTHERS VS. STATE OF HARYANA & OTHERS IN SLP NO.6609 TO 6613 OF 2014 DATED 24/3/2014, RELIED UPON BY THE LD DR FOR REVENUE. IN THIS CITED CASE THERE WAS AN INORDINATE DELAY OF APPROX. 10 YEARS 2 MONTHS AND 29 DAYS IN FILING THE APPEALS. THE FACTS WERE THAT THE PETITIONERS HAD ORIGINALLY NOT PREFERRED APPEALS BEFORE THE HONBLE HIGH COURT FOR ENHANCEMENT OF COMPENSATION, WHEREAS OTHER INTERESTED PERSONS DID SO. IT IS ONLY AFTER THE HONBLE COURT AWARDED ENHA NCED COMPENSATION AND OTHER STATUTORY BENEFITS TO THOSE OTHER INTERESTED PARTIES WHO HAD FILED THE APPEALS IN TIME, THAT THE PETITIONERS PREFERRED APPEALS FOR ENHANCED COMPENSATION AFTER A LAPSE OF ABOUT 10 YEARS 2 MONTHS AND 29 DAYS, WHICH THE HONBLE COU RT REFUSED TO CONDONE ON GROUNDS OF INORDINATE DELAY. IN OUR HUMBLE VIEW, NEITHER THE FACTS AND CIRCUMSTANCES NOR THE PERIOD OF DELAY IN THE CITED CASE (SUPRA) ARE APPLICABLE TO FACTS OF THE CASE ON HAND. 4.4.4 THE OTHER DECISION CITED BY THE LD DR FOR REV ENUE IS OF THE THIRD MEMBER DECISION OF THE ITAT, CHENNAI BENCH IN THE CASE OF JCIT VS. TRACTORS & FARM EQUIPMENTS LTD., (104 ITD 149). IN THIS CITED CASE (SUPRA), THE REASON PUT FORTH BY THE DIRECTOR OF THE COMPANY FOR DELAY IN FILING THE APPEAL WAS THAT THE ORDER OF THE CIT(A) WAS MISPLACED WITH SOME OTHER PAPERS AND IT IS ONLY ON SORTING OUT OF UNWANTED PAPERS THAT HE FOUND THAT NO STEPS HAD BEEN TAKEN TO FILE THE APPEAL. IN THAT CASE, REVENUE ESTABLISHED THE FACT THAT THE DIRECTOR WHO FILED THE AFFIDAVI T WAS NOT AUTHORIZED BY THE MANAGING DIRECTOR TO ATTEND/REPRESENT TAX MATTERS OF THE COMPANY. IN THAT FACTUAL MATRIX OF THE CASE THE TRIBUNAL CAME TO THE VIEW THAT THE REASONS PUT FORTH FOR CONDONING THE DELAY IN FILING THE APPEAL WERE NOT BONAFIDE AND ALS O THE SAID DELAY WAS DUE TO NEGLIGENCE AND INACTION ON THE PART OF THE ASSESSEE. IN THE CASE ON HAND, WE FIND THAT THERE IS NO DELIBERATE OR MALAFIDE INTENTION ON THE PART OF THE ASSESSEE IN FILING THE APPEAL BEFORE THE LD CIT(A) BELATEDLY; MORE SO WHEN TH E ASSESSEE, A SALARIED EMPLOYEE HAS BEEN FASTENED WITH A HUGE TAX LIABILITY OF RS.14,81,440/ - BY A CRYPTIC, NON SPEAKING ORDER OF ASSESSMENT U/S 143(3) OF THE ACT DATED 15/3/2013 FOR ASST. YEAR 2010 - 11 IN WHICH THERE IS NO DISCUSSION OR FINDING RENDERED B Y THE AO ON ANY OF THE ISSUES ON WHICH 8 ITA NO S . 807 TO 810/BANG/2019 ADDITIONS/DISALLOWANCES WERE MADE. IN OUR CONSIDERED VIEW, THE THIRD MEMBER DECISION OF ITAT, CHENNAI BENCH IN THE CASE OF TRACTORS & FARM EQUIPMENTS LTD., (SUPRA) IS NOT APPLICABLE TO THE FACTS OF THE CASE ON HAND. THE TRIBUNAL HAS CONDONED THE DELAY AND THE MATTER WAS RESTORED TO THE FILE OF CIT(APPEALS) FOR ADJUDICATION ON MERITS. WE FIND IN THE PRESENT CASE, THE ASSESSEE HAS SUFFICIENT CAUSE IN FILING THE APPEAL WITH DELAY OF 215 DAYS WITH THE SUPPORTING EVIDE NCE S AND ALSO APPLYING THE R ATIO OF DECISION TO THE PRESENT CASE WE FOUND THE DE LAY IN FILING THE APPEAL HAS A SUFFICIENT REASONABLE CAUSE . ACCORDINGLY WE CONDONE THE DELAY AND RESTORE THE APPEAL TO THE FILE OF CIT(APPEALS) TO ADJUDICATE ON MERITS AND TH E ASSESSEE SHOULD BE PROVIDED ADEQUATE OPPORTUNITY OF HEARING AND SHALL CO - OPERATE IN SUBMI TTING THE INFORMATION FOR EARLY DISPOSAL OF APPEAL. ACCORDINGLY, THE ORDER OF CIT(APPEALS) IS SET ASIDE AND RESTORE ENTIRE ISSUES TO THE FILE OF CIT(APPEALS) FOR AD JUDICATION AFRESH AND ALLOW THE GROUNDS OF APPEAL OF ASSESSEE FOR STATISTICAL PURPOSES. 7. IN THE RESULT, THE ASSESSEE'S APPEAL IS TREATED AS ALLOWED FOR STATISTICAL PURPOSES. 8. SIMILARLY, THE ASSESSEE HAS FILED APPEALS IN ITA NOS.808 , 809 AND 8 10/BANG/2019 WHERE THE ISSUE IS SIMILAR ON CON DONATION OF DELAY . WE APPLYING THE RATIO OF DECISION AS DEALT IN THE ABOVE PARAGRAPH, CONDONE THE DELAY IN FILING THE SE APPEALS BEFORE THE CIT (APPEALS) AND RESTORE THE DISPUTED ISSUE S TO THE FILE OF CIT (APPEALS) TO ADJUDICATE AFRESH ON MERITS AND ALLOW THE APPEALS OF ASSESSEE FOR STATISTICAL PURPOSES. 9 ITA NO S . 807 TO 810/BANG/2019 9. IN THE RESULT, THE ASSESSEE'S APPEALS IN ITA NOS.807, 808 , 809 AND 810/BANG/2019 ARE TREATED AS ALLOWED FOR STATISTICAL PURPOSES. ORDER P RONOUNCED IN THE OPEN COURT ON 2 9 T H JULY, 2019. S D / - S D / - (A.K. GARODIA) (PAVAN KUMAR GADALE) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 2 9 .07. 2019. *REDDY GP COPY TO 1. THE APPELLANT 2. THE RESPONDENT 3. CIT (A) 4. PR. CIT 5. DR, ITAT, BANGALORE. 6. GUARD FILE BY ORDER ASSISTANT REGISTRAR INCOME - TAX APPELLATE TRIBUNAL BANGALORE