M/s. Sagarmal Fakirchand HUF, Dhar V. ITO , Dhar

ITA 836/Ind/2019

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 2930 (ITAT-INDORE)
• Duration Of Justice: 6 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-03-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2014-2015
• Appeal Filed On: 23-08-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R P MOURYA
• Assessee Lawyers: S S DESHPANDE
• Keywords: TDS; Set aside
• Section: 143(3); 40(a)(ia); 40a(ia); 22

Judgement Text

[ITA NO.826/IND/2019] [SAGARMAL FAKIR CHAND 1 IN THE INCOME TAX APPELLATE TRIBUNAL INDORE SMC BENCH, INDORE BEFORE SHRI KUL BHARAT, JUDICIAL MEMBER ITA NO.836/IND/2019 ASSESSMENT YEAR: 2014-15 M/S. SAGARMAL FAKIRCHAND HUF CHOUPATI KANVAN DHAR / VS. ITO DHAR ( APPELLANT ) ( REVENUE ) P.A. N O. AAAHF0192F APPELLANT BY SHRI S.S. DESHPANDE CA RESPONDENT BY SHRI R . P . MOURYA , SR. DR DATE OF HEARING: 05.03.2020 DATE OF PRONOUNCEMENT: 09.03.2020 / O R D E R THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST ORDER O F THE CIT(A)-I, INDORE DATED 03.06.2019 PERTAINING TO T HE ASSESSMENT YEAR 2014-15. THE ASSESSEE HAS RAISED FOLLOWING GROUNDS OF APPEAL: THE LD. CIT(A) HAS ERRED IN MAINTAINING THE DISALLO WANCE OF RS.3,08,970/- BEING THE INTEREST PAID U/S 40A(IA) O N THE GROUND THAT TDS IS NOT MADE. THE ADDITION IS BAD IN LAW AN D DESERVES TO BE DELETED. THE SECOND PROVISO TO SECTION 40A(IA0 IS APPLICABL E SINCE THE [ITA NO.826/IND/2019] [SAGARMAL FAKIR CHAND 2 PAYEE HAS FILED THE RETURN AND HAS SHOWN THE INTERE ST IN ITS RETURN. THE CERTIFICATE TO THIS EFFECT WAS FILED BE FORE THE LD. CIT(A). THE ADDITION MAINTAINED MAY PLEASE BE DELET ED. 2. THE ONLY EFFECTIVE GROUND IN THIS APPEAL IS AGAINST SUSTAINING THE DISALLOWANCE OF RS. 3,08,970/- BEING TH E INTEREST FOR NOT DEDUCTING TAX AT SOURCE. 3. THE FACTS IN BRIEF ARE THAT THE CASE OF THE ASSESSEE WAS PICKED UP FOR SCRUTINY ASSESSMENT AND THE ASSESSMENT U/S 143(3) OF THE INCOME TAX ACT 1961(HEREIN AFTER REFER RED AS THE ACT ) WAS FRAMED VIDED ORDER DATED 27.11.2016. THE ASSESSING OFFICER WHILE FRAMING THE ASSESSMENT OBSERVE D THAT THE ASSESSEE HAD MADE PAYMENT OF INTEREST TO SMT. RIYA RAJAT KUMAR BOKADIYA ON 31.03.2014 FOR A SUM OF RS.3,08,970/-, THEREFORE, THE ASSESSING OFFICER MADE ADDITION OF RS.3,08,970/- BY INVOKING THE PROVISION OF U/S 40(A)(IA) OF THE ACT. [ITA NO.826/IND/2019] [SAGARMAL FAKIR CHAND 3 4. AGGRIEVED AGAINST THIS, THE ASSESSEE PREFERRED AN APPEAL BEFORE LD. CIT(A), WHO AFTER CONSIDERING SUBMISSIONS SUSTAINED THE ADDITION. NOW, THE ASSESSEE IS IN FURTHER APPEAL BEFORE THE TRIBUNAL. 5. AT THE OUTSET, LD. COUNSEL FOR THE ASSESSEE SUBMI TTED THAT THE ASSESSING OFFICER HAS DISALLOWED THE CLAIM OF THE ASSESSEE FOR PAYMENT OF INTEREST TO M/S CHAMBAL FERTI LIZERS & CHEMICALS LTD. WRONGLY MENTIONED BY THE ASSESSING OFFICER AS SMT. RIYA RAJAT KUMAR BOKADIYA. THESE EXPENS ES HAVE BEEN DISALLOWED U/S 40(A)(IA) OF THE ACT FOR NON- DEDUCTION OF THE TAX. HE SUBMITTED THAT THE SAID COMP ANY IS ASSESSED TO TAX AND HAS DISCLOSED THIS INCOME IN I TS RETURN AND HAS ISSUED A CERTIFICATE TO THIS FACT. HE HAS DRAWN MY ATTENTION TO THE CERTIFICATE ISSUED BY THE COMPANY. [ITA NO.826/IND/2019] [SAGARMAL FAKIR CHAND 4 6. LD. D.R. OPPOSED THESE SUBMISSIONS AND SUPPORTED THE ORDERS OF THE AUTHORITIES BELOW. 7. I HAVE HEARD THE RIVAL SUBMISSIONS, PERUSED THE MATERIALS AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW. THE CONTENTION OF THE ASSE SSEE IS THAT THE INTEREST WAS PAID TO THE COMPANY BUT NOT TO TH E INDIVIDUAL AS OBSERVED BY THE ASSESSING OFFICER FURTHE R THE SAID COMPANY NAMELY M/S CHAMBAL FERTILIZERS & CHEMICALS LTD. HAS GIVEN A CERTIFICATE TO THIS EFFECT AN D DISCLOSED THE INCOME IN ITS RETURN OF INCOME. THE AS SESSEE HAS ALSO PLACED RELIANCE ON THE DECISION OF THE COORDIN ATE BENCH IN THE CASE OF ACIT VS. PRATIBHA EXIM 22 ITJ P. 287 AND ALSO JUDGMENT OF THE HON'BLE SUPREME COURT RENDER ED IN THE CASE OF CIT VS. CALCUTTA EXPORT REPORTED IN 17 SCC 489 . CONSIDERING THE CASE LAWS AND THE FACTS STATED BY THE LD. COUNSEL FOR THE ASSESSEE. I DEEM IT PROPER TO SET ASIDE THE ORDERS OF THE AUTHORITIES BELOW AND RESTORE THE I SSUE TO [ITA NO.826/IND/2019] [SAGARMAL FAKIR CHAND 5 THE FILE OF ASSESSING OFFICER TO VERIFY THE CONTENT ION OF THE ASSESSEE THAT THE INTEREST WAS PAID TO THE COMPANY BUT N OT TO INDIVIDUAL AND THE SAID COMPANY HAS DISCLOSED SUCH INTEREST IN ITS RETURN OF INCOME AS PER AFORESAID CERT IFICATE AND IF THE FACTS STATED BY THE ASSESSEE ARE FOUND TO BE CORRECT THEN THE AO IS HEREBY DIRECTED TO DELETE TH E ADDITION. GROUNDS RAISED IN THIS APPEAL ARE ALLOWED FOR STATISTICAL PURPOSES. 8. THE APPEAL FILED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER WAS PRONOUNCED IN THE OPEN COURT ON 09 . 03.2020. SD/- (KU L BHARAT) JUDICIAL MEMBER INDORE; DATED : 09/03/2020 PATEL/PS COPY TO: ASSESSEE/AO/PR. CIT/ CIT (A)/ITAT (DR)/GUAR D FILE. BY ORDER ASSISTANT REGISTRAR, INDORE