Appeal details
Counselvise Citation
[2018] 121 COUNSELVISE.COM (IT) 6585 (ITAT-LUCKNOW)
Assessee PAN
Bench
Appeal Number
Duration Of Justice
2 year(s) 2 month(s) 6 day(s)
Appellant
Respondent
Appeal Type
Income Tax Appeal
Pronouncement Date
03-05-2018
Appeal Filed By
Assessee
Order Result
Partly Allowed
Bench Allotted
B
Next Hearing Date
01-05-2018
Assessment Year
misc
Appeal Filed On
26-02-2016
Judgement Text
IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH B , LUCKNOW BEFORE SHRI. T.S. KAPOOR, ACCOUNTANT MEMBER AND SHRI PARTHA SARATHI CHAUDHURY, JUDICIAL MEMBER ITA NO. 83 & 84/LKW/2016 ASSESSMENT YEAR: 2008 - 09 M/S STATE BANK OF BIKANER & JAIPUR 122/22 3, SAROJINI NAGAR KAUSHALPURI, KANPUR V. DY. CIT (TDS) KANPUR T AN /PAN : AADCS4750R (APP ELL ANT) (RESPONDENT) APPELLANT BY: SHRI VIKAS GARG, C.A. RESPONDENT BY: SHRI HARISH GIDWANI, D.R. DATE OF HEARING: 01 05 201 8 DATE OF PRONOUNCEMENT: 03 0 5 201 8 O R D E R PER P ARTHA SARATHI CHAUDHURY, J.M : THESE APPEALS PREFERRED BY THE ASSESSEE EMANATE FROM THE RESPECTIVE ORDERS OF THE LD. CIT(A) - II, KANPUR DATED 30/11/2015. 2 . THE MAIN GRIEVANCE OF THE ASSESSEE IS WITH REGARD TO THE DEMAND RAISED BY THE REVENUE AUTHORITIES FOR SHORT DEDUCTION OF TAX AT SOURCE. THESE CASES WERE HEARD TOGETHER AND THE FACTS BEING SIMILAR AND ISSUES COMMON, THEY ARE BEING DISPOSED OF IN THIS CONSOLIDATED ORDER. AS A MATTER OF CONVENIENCE, WE TAKE UP THE FACTS AS APPEARING IN ITA N O.83/LKW/2016. 3 . THE FACTS IN BRIEF ARE THAT THE ASSESSEE FURNISHED E - TDS RETURN FOR THE FINANCIAL YEAR 2007 - 08 IN THE PRESCRIBED FORM FOR THE SECOND QUARTER. THE SAID RETURN WHEN PROCESSED AND ANALYSED REVEALED DEFAULTS I.E. NON - PAYMENT OF TDS AMOUNT DEDUCT ED, LOW DEDUCTION OF TDS AT ITA NO.83 & 84/LKW/2016 PAGE 2 OF 6 PRESCRIBED RATE AND LATE PAYMENT OF TAXES. ACCORDINGLY, A SHOW CAUSE NOTICE UNDER SECTION 201(1A) OF THE INCOME TAX ACT, 1961 WAS ISSUED TO THE ASSESSEE ALONG WITH A DETAILED QUESTIONNAIRE INDICATING ENTRY - WISE REASONS OF THE D EFAULT NOTICED IN THE CASE OF DEDUCTOR I.E. ASSESSEE. SINCE THESE DEFAULTS WERE FACTUAL AND BASED ON THE ENTRIES REPORTED IN THE TDS STATEMENT, DEDUCTOR WAS ADVISED TO FILE 'CORRECTION STATEMENT' TO RECTIFY DATE ENTRY ERRORS, IF ANY, IN THE TDS STATEMENT W ITHIN 15 DAYS OF RECEIPT OF SUCH SHOW CAUSE NOTICE. THE NET DEFAULTS NOTICED AFTER THE EXPIRY OF STIPULATED PERIOD OF FIL ING THE 'CORRECTION STATEMENTS'. ACCORDINGLY, THE LD. DY. COMMISSIONER OF INCOME TAX (TDS), KANPUR DECLARED THE ASSESSEE TO BE AN ASS ESSEE IN DEFAULTS IN RESPECT OF AMOUNT OF RS.3,89,390/ - INCLUDING INTEREST UNDER SECTION 201(1A) OF THE ACT. 4 . B EING AGGRIEVED BY THE ORDER OF ASSESSING OFFICER , THE ASSESSEE PREFERRED AN APPEAL BEFORE THE LD. CIT(A) AND SUBMITTED THAT THE ASSESSEE HAS FIL ED HIS E - TDS RETURN FOR THE YEAR UNDER CONSIDERATION IN THE REQUISITE FORM IN 2 ND QTR FOR THE FINANCIAL YEAR 2007 - 08. TH IS RETURN WAS PROCESSED AND CERTAIN DISCREPANCIES WERE FOUND AND DEMAND RAISED FROM THE ASSESSEE ON FOLLOWING AMOUNTS : - (A) RS. 79,050/ - ON ACCOUNT OF SHORT DEDUCTION OF TDS IN FORM NO.26Q. (B) RS. 1,96,550/ - CHALLAN CLAIMED IN FORM 26Q BUT NOT FOUND IN OLTAS. (C) RS.1,13,790/ - ON ACCOUNT OF INTEREST U/S.201( 1 A) 5 . BEFORE THE LD. CIT(A), ASSESSEE SUBMITTED AS UNDER: - 1. THE LD. DY. COMMISS IONER OF INCOME TAX (TDS), KANPUR HAS CREATED DEMAND OF RS.79,050/ - ON ACCOUNT OF SHORT DEDUCTION OF TDS. IT IS UNDISPUTED FACT THAT STATUS OF DEDUCTEE WAS CORPORATE ITA NO.83 & 84/LKW/2016 PAGE 3 OF 6 ENTITY HENCEFORTH RATE OF DEDUCTION WAS 20.60% WHILE THE APPELLANT HAS DEDUCTED TAX AT SOU RCE @ 10.20% INADVERTENTLY. 2. YOUR HONOUR WILL APPRECIATE THERE WAS NO INTENTION TO DEFAULT THE PROVISION OF DEDUCTION AT SOURCE WHICH IS EVIDENT FROM FACTS ON RECORD THAT TAX HAS BEEN DEDUCTED WITHIN TIME AND REPORTED IN PRESCRIBED PROCEDURE. THE ONLY IS SUE UNDER THIS APPEAL IS SHORT DEDUCTION OF TDS WHICH CAUSED DUE TO MISINTERPRETATION OF PROVISION CONTEND IN SECTION 194A OF THE INCOME TAX ACT READ WITH RELEVANT RATE NOTIFIED AND MADE APPLICABLE DURING THE IMPUGNED PERIOD. 3. THE APPELLANT WISH TO ASSUR E YOUR ESTEEMED OFFICE THAT INCOME TAX LIABILITY PAYABLE BY DEDUCTEE THAT M/S MANTORA OIL PRODUCTS LIMITED AND 'M/S VISHAKHA TAX PRODUCTS LIMITED HAS BEEN DISCHARGED ON FULL TAXABLE INCOME OF THE SAID FINANCIAL YEAR. THE APPELLANT HAS REQUESTED TO THE DEDU CTEE TO PROVIDE THE COPY OF INCOME TAX RETURN ALONG WITH COMPUTATION OF INCOME FOR THE RELEVANT PERIOD TO SUBSTANTIATE OUR CLAIM. 4. THE APPELLANT WISH TO PLACE RELIANCE ON DECISION OF HONORABLE SUPREME COURT IN CASE OF HINDUSTAN COCA - COLA BEVERAGE PVT. LT D. V CIT (2007) 163 TAXMAN 355 (SC) HELD THAT TAX CANNOT BE RECOVERED FROM DEDUCTOR, IF THE SAME HAS BEEN PAID BY THE DEDUCTEE. THE ABOVE DECISION WAS GIVEN BY HON'BLE COURT BY REFERRING TO CIRCULAR NO. 275/201/95 - IT(B), DATED 29 - 01 - 1997 ISSUED BY CBDT. TH E CIRCULARS DECLARES THAT NO DEMAND VISUALIZED UNDER SECTION 201(1) SHOULD BE ENFORCED AFTER THE TAX DEDUCTOR HAS SATISFIED THE OFFICER - IN - CHARGE OF TDS THAT TAXES DUE HAVE BEEN PAID BY THE DEDUCTEE - ASSESSEE. 5. YOUR HONOUR WILL APPRECIATE THAT ON THE BASI S OF ABOVE FACTS AND DOCUMENTS, IT IS EVIDENT THAT THERE IS NO LOSS OF REVENUE HENCEFORTH IMPUGNED DEMAND OF TDS AND INTEREST THEREON MAY BE DROPPED IN THE LIGHT OF DECISION OF HON'BLE SUPREME COURT AS STATED ABOVE. ITA NO.83 & 84/LKW/2016 PAGE 4 OF 6 6. THE LD. DY. COMMISSIONER OF INCOME TA X (TDS), KAN PUR HAS CONFIRMED DEMAND OF RS. 1,96,553/ - ON THE PREMISE THAT DETAILS OF TDS DEPOSIT IS MISMATCHED. THE APPELLANT IS ENCLOSING HEREWITH A COPY OF CHALLAN ALONG WITH THE COPY OF CHALLAN STATUS FOR THE RELEVANT PERIOD AS EXTRACTED FROM THE TIN - NS DL SITE WHICH IS SELF EXPLANATORY TO ESTABLISH THAT DEDUCTED TAX HAS BEEN DEPOSITED WITHIN DUE TIME HOWEVER TAN OF DEDUCTOR HAS BEEN QUOTED AS KNPS02183U INSTEAD OF KNPS02183G INADVERTENTLY. YOUR HONOUR WILL APPRECIATE THAT CREDIT OF TAX (SUBSTANTIAL BENEF IT) COULD NOT BE DETACHED DUE TO PROCEDURAL MISTAKE. 7. THUS, UNDER THE ABOVE CIRCUMSTANCES, THE DEMAND RAISED BY THE LD. DY. COMMISSIONER OF INCOME TAX (TDS), KANPUR IS UNJUSTIFIED AND UNCALLED FOR AND WITHOUT GIVING OPPORTUNITY FOR SUBMITTING THE FACTS O F THE CASE. CONSIDERING THE ABOVE FACTS, YOUR GOODSELF IS PRAYED TO KINDLY ALLOW THE APPEAL SO THAT JUSTICE MAY BE DONE. 6 . THE LD. CIT(A), AFTER CONSIDERING THE ASSESSMENT ORDER AND THE WRITTEN SUBMISSIONS OF THE ASSESSEE, OBSERVED THAT IN THE DECISION OF THE HON'BLE APEX COURT IN THE CASE OF HINDUSTAN COCA - COLA BEVERAGE PVT. LTD. VS. CIT [2007] 163 TAXMAN 355 (SC), IT IS HELD THAT TAX CANNOT BE RECOVERED FROM DEDUCTOR, IF THE SAME HAS BEEN PAID BY THE DEDUCTEE. TH IS DECISION WAS GIVEN BASED ON THE CIRCULAR NO. 275/201/95 - IT(B), DATED 29 - 01 - 1997 ISSUED BY THE CBDT. THE CIRCULAR DECLARES THAT NO DEMAND VISUALIZED UNDER SECTION 201(1) SHOULD BE ENFORCED AFTER THE TAX DEDUCTOR HAS SATISFIED THE O FFICER - IN - CHARGE OF TDS THAT TAXES DUE HAVE BEEN PAID BY THE DEDUC TEE - ASSESSEE. HOWEVER, THE ONUS IS ON THE ASSESSE E TO PROVE BEFORE THE ASSESSING OFFICER THAT TAXES DUE HAVE BEEN PAID BY THE DEDUCTEE. BEFORE THE LD. CIT(A) ALSO NO SUCH DOCUMENTS WERE PLACED ON RECORD TO SUPPORT THAT DEDUCTEE HAS PAID TAX IN THE GOVERNME NT ACCOUNT AND, THEREFORE, IN THE ABSENCE OF THESE EVIDENCES, ITA NO.83 & 84/LKW/2016 PAGE 5 OF 6 THE LD. CIT(A) UPHELD THE ACTION OF THE ASSESSING OFFICER DECLARING THE ASSESSEE IN DEFAULT . 7 . AT THE TIME OF HEARING BEFORE US, THE LD. A.R. OF THE ASSESSEE PLACED STRONG RELIANCE UPON THE DECISI ON OF THE HON'BLE APEX COURT IN THE CASE OF HINDUSTAN COCA - COLA BEVERAGE PVT. LTD. VS. CIT (SUPRA) AND IN CONNECTION TO THAT VEHEMENTLY ARGUED THAT THEY HAVE GOT SUPPORTING EVIDENCES AND DOCUMENTS I.E. RELEVANT CHALLANS OF TAXES PAID TO THE GOVERNMENT ACCO UNT BY THE DEDUCTEE AND SINCE DEDUCTEE HAS PAID TAX, ASSESSEE CANNOT BE HELD TO BE AN ASSESSEE IN DEFAULT. 8 . THE LD. D.R., ON THE OTHER HAND, RELIED ON THE ORDERS OF THE AUTHORITIES BELOW. 9 . WE HAVE PERUSED THE CASE RECORDS, ANALYSED THE FACTS AND CIRCUMSTAN CES OF THE CASE AND WE FIND THAT BASIC SANCTITY OF TDS PROVISIONS IN TH E ACT HIGHLIGHTS THE FACT THAT R EVENUE SHOULD NOT BE DEFRAUDED. THE TAX HAS TO BE PAID BY WAY OF TDS EITHER BY THE DEDUCTOR OR BY THE DEDUCTEE. IF THE DEDUCTOR FAILS TO PAY TDS AND IF THE DEDUCTEE PAYS THE SAME TAX IN THE GOVERNMENT ACCOUNT , THEN AS PER THE DECISION OF THE HON'BLE APEX COURT (CITED SUPRA) AND IN VIEW OF THE VERY SPIRIT OF TDS PROVISIONS , WHICH IS ALSO EVIDENT I N THE CBDT CIRCULAR REFERRED TO ABOVE, THE DEDUCTOR SHOULD NOT BE HELD TO BE AN ASSESSEE IN DEFAULT. THE LOGIC BEING SIMPLE THAT THE GOVERNMENT REVENUE IS NOT BEING DEPRIVED OFF. BEFORE US, ASSESSEE HAS PLACED ALL THE CHALLANS OF THE DEDUCTEE AND CLAIMS THAT TAXES ARE PAID BY THE DEDUCTEE AND THEREFORE ASSESSEE - DEDUCTOR SHOULD NOT BE PENALIZED AND ASSESSEE SHOULD NOT BE DECLARED TO BE AN ASSESSEE IN DEFAULT. WE ARE OF THE CONSIDERED VIEW THAT THESE DOCUMENTS REQUIRE FACTUAL VERIFICATION BY THE ASSESSING OFFICER. WE, THEREFORE, SET ASIDE THE ORDER OF THE LD. CIT (A) AND RESTORE THE MATTER TO THE FILE OF THE ASSESSING OFFICER TO VERIFY THE ITA NO.83 & 84/LKW/2016 PAGE 6 OF 6 TDS PAID BY THE DEDUCTEE AND DECIDE THE ISSUE AFRESH IN THE LIGHT OF THE DECISION OF THE HON'BLE APEX COURT IN THE CASE OF HINDUSTAN COCA - COLA BEVERAGE PVT. LTD. VS. CIT (SUPRA) AFTER PROVIDING OPPORTUNITY OF HEARING TO THE ASSESSEE. 10 . NOW WE TAKE UP ITA NO.84/LKW/2016. THE FACTS BEING COMMON AND ISSUE SIMILAR, THEREFORE, IN THIS CASE ALSO WE SET ASIDE THE ORDER OF THE LD. CIT(A) AND RESTORE THE MATTER TO THE FILE OF THE ASSESSING OFFICER TO ADJUDICATE THE SAME AFRESH LOOKING INTO THE EVIDENCES FILED BY THE ASSESSEE IN THE FORM OF CHALLANS AND ALSO IN THE LIGHT OF THE DECISION OF THE HON'BLE APEX COURT IN THE CASE OF HINDUSTAN COCA - COLA BEVERAGE PVT. LTD. VS. CIT (SUPRA) AND AFTER P ROVIDING OPPORTUNITY OF HEARING TO THE ASSESSEE. 11 . IN THE RESULT, BOTH THE APPEALS OF THE ASSESSEE ARE ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 03 / 0 5 / 201 8 . SD/ - SD/ - [ T.S. KAPOOR ] [PARTHA SARATHI CHAUDHURY ] ACCOUNTANT MEM BER JUDICIAL MEMBER DATED: 3 RD MAY , 201 8 JJ: 0105 COPY FORWARDED TO: 1 . APPELLANT 2 . RESPONDENT 3 . CIT(A) 4 . CIT 5 . DR
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