M/s Punjab Infrastructure Development Board, Chandigarh V. ACIT (TDS), Chandigarh

ITA 880/CHANDI/2013

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 9209 (ITAT-CHANDIGARH)
• Duration Of Justice: 5 year(s) 6 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-03-2019
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 13-03-2019
• Assessment Year: 2009-2010
• Appeal Filed On: 03-09-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: MANJIT SINGH
• Keywords: TDS
• Section: 40(a)(ia); 201(1); 6; 15; 139

Judgement Text

, - , IN THE INCOME TAX APPELLATE TRIBUNAL DIVISION BENCH, B, CHANDIGARH , ! '# $ % & '# , () BEFORE SHRI SANJAY GARG, JUDICIAL MEMBER AND MS. ANNAPURNA GUPTA, ACCOUNTANT MEMBER ./ ITA NOS. 880 & 881/CHD/2013 / ASSESSMENT YEARS : 2009-10 & 2010-11 PUNJAB INFRASTRUCTURE DEVELOPMENT BOARD, SCO 33-35, SECTOR 34A, CHANDIGARH ASSTT. COMMISSIONER OF INCOME TAX (TDS), CHANDIGARH ./PAN NO: AAALP6048F APPEAL AGAINST THE ORDER OF CIT(A), CHANDIGARH DATE D 28.06.2013 ./ ITA NO. 09/CHD/2013 / ASSESSMENT YEARS : 2008-09 PUNJAB INFRASTRUCTURE DEVELOPMENT BOARD, SCO 33-35, SECTOR 34A, CHANDIGARH ASSTT. COMMISSIONER OF INCOME TAX (TDS), CHANDIGARH ./PAN NO: AAALP6048F APPEAL AGAINST THE ORDER OF CIT(A), CHANDIGARH DATE D 13.10.2012 ./ ITA NOS. 788 TO 791/CHD/2014 / ASSESSMENT YEARS : 2009-10, 2010-11 & 2011-12 PUNJAB INFRASTRUCTURE DEVELOPMENT BOARD, SCO 33-35, SECTOR 34A, CHANDIGARH JOINT COMMISSIONER OF INCOME TAX (TDS), CHANDIGARH ./PAN NO: AAALP6048F APPEAL AGAINST THE ORDER OF CIT(A), CHANDIGARH DATE D 13.6.2014 /ASSESSEE BY : SH. DEEPAK AGGARWAL, CA / REVENUE BY : SH. MANJIT SINGH, SR. DR ! /DATE OF HEARING : 13.03.2019 '#$% ! /DATE OF PRONOUNCEMENT : 29. 03.2019 ITA NOS. 880, 881 & 9-C-13, 788 TO 7891-C-2014- PUNJAB INFRASTRUCTURE DEVELOPMENT BOARD, CHANDIGARH 2 (* / ORDER PER BENCH: THESE APPEALS HAVE BEEN REMANDED BACK BY THE HON'BL E PUNJAB & HARYANA HIGH COURT VIDE COMMON ORDERS PASSED IN ITA NOS. 100, 68 & 64 OF 2016 DATED 20.12.2016 AND SEPARATE ORDERS DATED 9.5.2017 IN ITA NOS. 65, 69, 97 & 98 (O&M) OF 2016 RESPECTIVELY TO DECIDE AS TO WHETHER THE ASSESSEE HEREIN BEFORE US NAMELY PUNJAB INFRAS TRUCTURE DEVELOPMENT BOARD (HEREIN REFERRED TO AS PIDB) WAS REQUIRED TO COLLECT TAX AT SOURCE (TCS) AS PER THE PROVISIONS OF SECTION 206(1C) OF T HE INCOME-TAX ACT, 1961 (IN SHORT 'THE ACT'). 2. THE BRIEF FACTS RELATING TO THE ISSUE ARE THAT D URING THE COURSE OF TDS INSPECTION AND ASSESSMENT PROCEEDINGS U/S 206C(1C) / 206C(7) OF THE ACT, THE ASSESSING OFFICER NOTICED THAT ASSESSEE PIDB HAD RECEIVED CERTAIN AMOUNTS FROM THE CONTRACTOR [HEREIN REFERRED TO AS CONCESSIONAIRE] IN AWARDING / ENTERING INTO CONCESSION AGREEMENT FOR T OLL PLAZA OPERATION / TOLL BASED OPERATION AND MAINTENANCE CONCESSION F OR CERTAIN SEGMENTS OF ROADS. THAT THE ASSESSEE BEING PERSON RESPONSIBLE ( PR) WAS REQUIRED TO COLLECT TAX AT SOURCE U/S 206C OF THE ACT, HOWEVER , THE ASSESSEE FAILED TO SO. THEREFORE, THE ASSESSING OFFICER ISSUED NOTICE D TO THE ASSESSEE / PR TO THE EFFECT AS TO WHY IT MAY NOT BE HELD RESPONSIBLE UNDER THE PROVISIONS OF SECTION 206C (1C) / 206C (7) OF THE ACT FOR NOT COL LECTING TAX AT SOURCE. HOWEVER, THE ASSESSEE DENIED ITS LIABILITY TO COLL ECT THE TAX AT SOURCE. IT WAS PLEADED THAT THE CONCESSIONAIRE NAMELY M/S ROH AN RAJDEEP TOLLWAYS ITA NOS. 880, 881 & 9-C-13, 788 TO 7891-C-2014- PUNJAB INFRASTRUCTURE DEVELOPMENT BOARD, CHANDIGARH 3 LTD. FILED ITS RETURN OF INCOME AND PAID THE DUE TA XES, THEREFORE, EVEN THOUGH THE ASSESSEE HAD NOT COLLECTED THE TAX AT S OURCE BUT IT COULD NOT BE TREATED AS ASSESSEE IN DEFAULT IN THE LIGHT OF TH E DECISION OF THE HON'BLE SUPREME COURT IN THE CASE OF HINDUSTAN COCA COLA B EVERAGE (P) LTD VS. CIT [2007] 293 ITR 226 (SC) HOWEVER, THE ASSESSI NG OFFICER OBSERVED THAT THE DECISION CITED BY THE ASSESSEE WAS NOT APP LICABLE TO THE FACTS AND CIRCUMSTANCES OF THE CASE. THE ASSESSING OFFICER OB SERVED THAT SINCE THE ASSESSEE / PR HAD FAILED TO COLLECT AND DEPOSIT TAX U/S 206C OF THE ACT, THEREFORE, THE ASSESSEE WAS LIABLE TO BE HELD AS A SSESSEE IN DEFAULT U/S 206C OF THE ACT. HE ACCORDINGLY CREATED THE DEMAND OF TAX AND INTEREST AS PER THE PROVISIONS OF SECTION 206C (1C) / 206 C(7) OF THE ACT. 3. ON APPEAL, THE LD. CIT(A) UPHELD THE ORDER OF TH E ASSESSING OFFICER. 4. BEFORE THE TRIBUNAL, IT WAS PLEADED BY THE ASSES SEE THAT THE PROVISO INSERTED TO SECTION 206C (6A)OF THE ACT W.E.F. 1.7 .2012 STIPULATES THAT IF THE PR FAILS TO COLLECT THE TAX AT SOURCE, BUT THE CONCERNED BUYER / LICENSEE OR LESSEE, AS THE CASE MAY BE, HAS FURNISHED HIS RE TURN OF INCOME U/S 139 OF THE ACT AND HAS TAKEN INTO ACCOUNT SUCH AN AMOUNT F OR COMPUTING THE INCOME IN SUCH RETURN OF INCOME AND HAS PAID THE DU E TAXES ON INCOME DECLARED BY HIM AND HAS FURNISHED A CERTIFICATE T O THIS EFFECT FROM THE ACCOUNTANT, THEN SUCH ASSESSEE / PR, WOULD NOT BE D EEMED TO BE AS ASSESSEE IN DEFAULT. THE TRIBUNAL HELD THAT THE AFORESAID PROVISO WHICH WAS AKIN TO THE FIRST PROVISO TO SECTION 201(1) OF THE ACT READ WITH SECOND PROVISO TO SECTION 40(A)(IA) OF THE ACT WAS TO BE T AKEN AS DECLARATORY AND CURATIVE IN NATURE AND THE SAME HAS THE RETROSPECT IVE EFFECT FROM 1.4.2005. THE TRIBUNAL, THEREFORE, HELD THAT THE ASSESSEE UND ER THE CIRCUMSTANCES ITA NOS. 880, 881 & 9-C-13, 788 TO 7891-C-2014- PUNJAB INFRASTRUCTURE DEVELOPMENT BOARD, CHANDIGARH 4 COULD NOT BE HELD AS ASSESSEE IN DEFAULT AND ACCO RDINGLY DELETED THE IMPUGNED DEMAND CREATED U/S 206C (1C) / 206C (7) OF THE ACT VIDE COMMON ORDER DATED 30.09.2015. 5. BEING AGGRIEVED BY THE ABOVE ORDER OF THE TRIBUN AL, THE REVENUE PREFERRED APPEAL BEFORE THE HON'BLE PUNJAB & HARYAN A HIGH COURT. THE HON'BLE HIGH COURT HELD THAT THOUGH IN THE LIGHT OF THE DECISION OF THE HON'BLE SUPREME COURT IN HINDUSTAN COCA COLA BEVER AGE (P) LTD VS. CIT (SUPRA), WHEREBY, THE PAYEE / PURCHASER / LIC ENSEE HAD FILED A RETURN OF INCOME AND PAID THE DUE TAXES AND THEN IN THAT CASE AS PER THE NEWLY INSERTED PROVISO TO SECTION 206 C(6A) OF THE ACT, T HE DEMAND FOR THE PARTICULAR AMOUNT CANNOT BE ENFORCED UPON BY THE AS SESSEE / PR. HOWEVER, THIS WOULD NOT ALTER THE LIABILITY TO PAY INTEREST UNDER THE PROVISIONS OF SECTION 206 C(7) AND PENALTY U/S 271CA OF THE ACT, AS THE CASE MAY BE. THE HON'BLE HIGH COURT FURTHER HELD THAT TERMINAL POINT FOR CALCULATION OF THE INTEREST / PENALTY PAYABLE HAS TO BE TAKEN AS T HE DATE ON WHICH THE ASSESSEE WAS LIABLE TO COLLECT TAX I.E. THE DATE OF PAYMENT TILL THE DATE ON WHICH THE CONCESSIONAIRE SHOULD HAVE FILED THE RETU RN HOWEVER, A PLEA WAS TAKEN BY THE ASSESSEE BEFORE TH E HON'BLE HIGH COURT THAT THE LIABILITY TO PAY INTEREST OR THE PEN ALTY, AS THE CASE MAY BE, UNDER THE PROVISIONS OF SECTION 206C(7) OR 271 CA, AS THE CASE MAY BE, WOULD ARISE ONLY, IF THE ASSESSEE WAS HELD TO BE PERSON RESPONSIBLE TO DEDUCT / COLLECT TAX AT SOURCE. IT WAS PLEADED THAT THE CONCESSION AGREEMENT WAS ENTERED INTO BETWEEN THE STATE OF PUN JAB AND THE CONCESSIONAIRE M/S ROHAN RAJDEEP TOLLWAYS LTD. AN D THAT THE ASSESSEE PIDB WAS JUST A CONFIRMING PARTY. THE ASSESSEE AC TED JUST AS A NODAL ITA NOS. 880, 881 & 9-C-13, 788 TO 7891-C-2014- PUNJAB INFRASTRUCTURE DEVELOPMENT BOARD, CHANDIGARH 5 AGENCY ON BEHALF OF THE GOVERNMENT OF PUNJAB, WHERE AS, THE TOLL RIGHTS WERE IN FACT GRANTED BY THE GOVERNMENT OF PUNJAB TO THE CONCESSIONAIRE. IT WAS ALSO CONTENDED THAT THE CONCESSIONAIRE WAS RESP ONSIBLE FOR THE OVERALL OPERATION AND MAINTENANCE OF THE PROJECT FACILITY AND THAT IT WAS NOT MERELY GRANTED USAGE OF THE TOLL PLAZA, THEREFORE , THE PROVISIONS OF SECTION 206 C(IC) WERE NOT ATTRACTED IN THIS CASE. 6. THE HON'BLE HIGH COURT CONSIDERING THE ABOVE PLE A OF THE ASSESSEE OBSERVED THAT THE TRIBUNAL ONLY CONSIDERED THE ASSE SSEES ALTERNATIVE CONTENTION TO THE EFFECT THAT THE CONCESSIONAIRE HA D FILED THE RETURN AND PAID THE DUE TAXES. HOWEVER, THE TRIBUNAL DID NOT C ONSIDER THE ASSESSEES MAIN CONTENTION THAT THE PROVISIONS OF SECTION 20 6 C(1C) WERE NOT APPLICABLE AT ALL. THE MATTER, THEREFORE, WAS REMAN DED BACK TO THE TRIBUNAL TO DECIDE THE ISSUE WHETHER THE PROVISIONS OF SECTI ON 206C(1C) OF THE ACT WERE ATTRACTED IN THESE CASES OR NOT FOR THE PURPOS E OF LEVY OF INTEREST LIABILITY U/S 206C(7) OR THE PENALTY U/S 271CA OF THE ACT. 7. IT IS PERTINENT TO MENTION HERE THAT IN THE MEAN TIME THE CONCESSIONAIRE NAMELY M/S ROHAN RAJDEEP TOLLWAYS L TD. FILED A CIVIL WRIT PETITION NO.20680 OF 2014 AGITATING HIS LIABIL ITY TO PAY THE DEMAND CREATED UNDER THE PROVISIONS OF SECTION 206 C(1C) O F THE ACT OR THE INTEREST UNDER THE PROVISIONS OF SECTION 206C(7) OR THE PEN ALTY UNDER THE PROVISIONS OF SECTION 271CA OF THE ACT. IT HAS BEE N PLEADED BEFORE THE HON'BLE HIGH COURT THAT THERE WAS NO OBLIGATION OF THE CONCESSIONAIRE NAMELY ROHAN RAJDEEP TOLLWAYS LTD. TO INDEMNIFY TH E ASSESSEE I.E. PIDB FOR ANY DEFAULT ON THE PART OF PIDB TO COLLECT THE TAX AT SOURCE. THAT THE ITA NOS. 880, 881 & 9-C-13, 788 TO 7891-C-2014- PUNJAB INFRASTRUCTURE DEVELOPMENT BOARD, CHANDIGARH 6 PETITIONER / CONCESSIONAIRE HAD TO REPEATEDLY RENEW THE BANK GUARANTEE THOUGH IT WAS UNDER NO OBLIGATION TO INDEMNIFY THE RESPONDENT /ASSESSEE PIDB AS THE CONCESSIONAIRE HAS ALREADY CLEARED THE ENTIRE TAX LIABILITY. THE HON'BLE HIGH COURT VIDE ORDER DATED 06.02.2019 DIRE CTED THIS TRIBUNAL TO MAKE ENDEAVOR TO PROMPTLY DECIDE THE APPEALS PREFE RRED BY THE ASSESSEE PIDB RELATING TO ITS TAX / INTEREST / PENALTY LIABI LITY UNDER THE PROVISIONS SECTION 206C (1C) / 206C(7) OR 271CA, AS THE CASE MAY BE. 8. THE APPEALS WERE TAKEN UP FOR HEARING FOR 7.3.20 19, HOWEVER, THE LD. COUNSEL FOR THE ASSESSEE SOUGHT TIME TO GIVE AN SWER TO THE CERTAIN QUERIES RELEVANT TO THE ISSUE RAISED BY THE BENCH. UNDER THE CIRCUMSTANCES, ON HIS REQUEST, THE HEARING WAS ADJOURNED TO 13.3.2 019. THE MATTER WAS ACCORDINGLY HEARD ON 13.3.2019. 9. BEFORE PROCEEDING FURTHER, IT IS PERTINENT TO ME NTION HERE THAT THE HON'BLE HIGH COURT WHILE REMANDING THE IDENTICAL M ATTER TO THIS TRIBUNAL IN SOME OTHER APPEALS HAS MADE CERTAIN OBSERVATION S IN ORDERS DATED 20.12.2016 IN ITA NOS. 66, 71 AND 99 OF 2017 THAT T HE CONSTRUCTION/INTERPRETATION OF THE CONTRACT REFERRE D TO BY THE PARTIES AS CONCESSIONAIRE AGREEMENT WOULD BE OF VITAL IMP ORTANCE IN ASCERTAINING WHETHER THE ASSESSEE ENTERED INTO THE SAME ON ITS OWN ACCOUNT AND FOR AND ON BEHALF ITSELF OR WHETHER IT DID SO AS A NODAL AGENCY FOR AND ON BEHALF OF THE GOVERNMENT OF PUNJA B. FURTHER THE MATTER MAY NOT END BY A MERE READING OF THE CONTRAC T. IT MAY BE NECESSARY TO CONSIDER THE SURROUNDING CIRCUMSTANCES IF THE TERMS THEREOF ARE NOT CLEAR. IT HAS ALSO BEEN OBSERVED B Y THE HON'BLE HIGH COURT IN THE ORDER DATED 20.12.2016 IN ITA NO. 73 -2016 RELATING TO THE ITA NOS. 880, 881 & 9-C-13, 788 TO 7891-C-2014- PUNJAB INFRASTRUCTURE DEVELOPMENT BOARD, CHANDIGARH 7 IDENTICAL ISSUE RAISED THEREIN THAT THERE IS A POS SIBILITY OF QUESTIONS OF FACT ARISING. FOR INSTANCE, IT WOULD BE NECESSARY T O CONSIDER WHETHER THE ASSESSEE WAS MERELY A NODAL AGENCY FOR THE GOVE RNMENT OF PUNJAB OR WHETHER IT WAS ACTING ON ITS OWN ON A PRI NCIPLE TO PRINCIPLE BASIS WITH THE CONCESSIONAIRE. THE ANSWER TO THIS I SSUE MAY NOT DEPEND ONLY UPON THE TERMS OF THE AGREEMENT. 10. WE THEREFORE, PROCEED TO DECIDE THE ISSUE IN TH E LIGHT OF THE ABOVE OBSERVATIONS MADE BY THE HON'BLE HIGH COURT. AT THE OUTSET, THE LD. COUNSEL FOR THE ASSESSEE I NVITED OUR ATTENTION TO THE CONCESSION AGREEMENT DATED 21.2.2007 FOR TOLL BASED OPERATION AND MAINTENANCE CONCESSION OF ROPAR-PHAGWARA ROAD PROJECT AND HAS SUBMITTED THAT THIS AGREEMENT MAY BE TAKEN AS A BAS E AGREEMENT AS THE OTHER AGREEMENTS RELATING TO THE OTHER ROADS WERE ALMOST IDENTICAL TO THIS AGREEMENT. HE INVITED OUR ATTENTION TO THE NAMES AN D DETAILS OF THE PARTIES, TO THE AGREEMENT, AND HAS STATED THAT PERUSAL OF TH E AFORESAID AGREEMENT DATED 21.2.2007 REVEALS THAT THE SAME HAS BEEN ENTE RED INTO BY THE GOVERNOR OF STATE OF PUNJAB IN HIS EXECUTIVE CAPAC ITY FOR THE STATE OF PUNJAB ACTING THROUGH THE SECRETARY, PUBLIC WORKS D EPARTMENT, GOVERNMENT OF PUNJAB, AS FIRST PARTY AND HAS BEEN R EFERRED TO AS GOP (GOVERNMENT OF THE STATE OF PUNJAB) WITH M/S ROHAN RAJDEEP TOLLWAYS LTD., REFERRED TO AS CONCESSIONAIRE FOR THE GRANT OF CONCESSION AGREEMENT FOR ROPAR PHAGWARA ROAD SEGMENT TO ESTA BLISH TOLLING FACILITY FOR THE PROFESSIONAL MANAGEMENT, OPERATIONS AND MAI NTENANCE OF THE PROJECT ON A COMMERCIAL PUBLIC PRIVATE PARTNERSHIP FORMAT BY THE LEVY OF USER CHARGES. THAT THE ASSESSEE I.E. PIDB HAS ALSO BEEN NAMED AS A PARTY TO ITA NOS. 880, 881 & 9-C-13, 788 TO 7891-C-2014- PUNJAB INFRASTRUCTURE DEVELOPMENT BOARD, CHANDIGARH 8 THE CONTRACT BUT ONLY AS A CONFIRMING PARTY AND T HAT THE PIDB ACTED FOR AND ON BEHALF OF THE GUARANTOR I.E. GOVERNMENT OF P UNJAB HAD UNDERTAKEN A TRANSPARENT COMPETITIVE BIDDING PROCESS TO SELECT T HE PRIVATE SECTOR PARTICIPANT FOR IMPLEMENTING THE PROJECT AND PURSUA NT TO THE ABOVE, THE CONCESSIONAIRE BEING FOUND THE PREFERRED BIDDER, WA S ACCORDINGLY GRANTED THE CONCESSION. THE LD. COUNSEL, THEREFORE, HAS SUB MITTED THAT THE CONCESSION WAS GRANTED BY THE PUNJAB GOVERNMENT AND THAT THE ASSESSEE PIDB HAD ACTED ONLY AS NODAL AGENCY ON BEHALF OF TH E GOVERNMENT OF PUNJAB AND THAT THE TOLL FEE / PAYMENT, IF ANY, COL LECTED FROM THE CONCESSIONAIRE WAS ON BEHALF OF THE GOVERNMENT OF P UNJAB. THEREFORE, THE ASSESSEE WAS NOT LIABLE TO COLLECT TAX AT SOURCE AS PER THE PROVISIONS OF SECTION 206C (1C) OF THE ACT. THE LD. COUNSEL HAS FURTHER INVITED OUR ATTENTION TO THE PUNJAB INFRASTRUCTURE (DEVELOPMENT & REGULATION) ACT, 2002 [HEREIN AFTER REFERRED TO PI (D&R) ACT, 2002] TO STATE THAT AS PER THE PROVISIONS OF THE ACT, TH E ASSESSEE BOARD HAS BEEN ESTABLISHED U/S 18 OF THE S AID ACT THAT IT HAS BEEN SPECIFICALLY PROVIDED UNDER THE PROVISIONS OF SECTI ON 20 OF THE SAID ACT THAT THE BOARD HAS TO ACT AS A NODAL AGENCY TO CO-O RDINATE ALL EFFORTS OF THE STATE GOVERNMENT REGARDING DEVELOPMENT OF THE INFRA STRUCTURE SECTOR. THAT AS PER SECTION 20 (2)(V) OF THE PI (D&R) ACT , 2002 THE BOARD CAN RECOMMEND THE GRANT OF CONCESSIONS TO THE PUBLIC IN FRASTRUCTURE AGENCY IN ACCORDANCE WITH THE PROVISIONS OF THE ACT AND THAT THE CONCESSION AGREEMENT ARE TO BE ENTERED INTO BETWEEN THE CONCE SSIONAIRE AND THE PUBLIC INFRASTRUCTURE AGENCY AS PER PROVISIONS OF THE ACT. THAT AS PER SECTION 2(23) OF THE ACT, THE PUBLIC INFRASTRUCTU RE AGENCY MEANS A GOVERNMENT DEPARTMENT, GOVERNMENT COMPANY, GOVERNME NT-OWNED OR ITA NOS. 880, 881 & 9-C-13, 788 TO 7891-C-2014- PUNJAB INFRASTRUCTURE DEVELOPMENT BOARD, CHANDIGARH 9 CONTROLLED CORPORATION, LOCAL AUTHORITY OR A PUBLIC BODY WHICH OWN OR GOVERNS OR CONTROL INFRASTRUCTURE SECTORS OR INFRAS TRUCTURE PROJECTS. THE LD. COUNSEL, THEREFORE, HAS SUBMITTED THAT A PERUSA L OF THE CONCESSION AGREEMENT AS WELL AS OF THE STATUTORY PROVISIONS WO ULD REVEAL THAT NEITHER THE PIDB HAD ACTUALLY ENTERED INTO AN AGREEMENT WIT H THE CONCESSIONAIRE NOR THE PIDB WAS STATUTORILY AUTHORISED TO DO SO. S INCE THE PIDB HAD NOT GRANTED THE CONCESSION AGREEMENT, HENCE, IT WAS NOT AUTHORIZED TO COLLECT TOLL FEE ALSO. THAT WHAT HAS BEEN COLLECTED BY PIDB WAS ONLY A CONCESSION FEE BEING A CONFIRMING PARTY TO THE AGREEMENT AND THAT TOO HAS BEEN COLLECTED ON BEHALF OF THE GOVERNMENT OF PUNJAB. TH E LD. COUNSEL FOR THE ASSESSEE, THEREFORE, SUBMITTED THAT THE PROVISION S OF SECTION 206 C(1C) OF THE INCOME TAX ACT WERE ATTRACTED IN THIS CASE. 11. THE LD. DR, ON THE OTHER HAND, HAS ALSO RELIED UPON THE VARIOUS STATUTORY PROVISIONS TO SHOW THAT IT IS ONLY THE AS SESSEE BOARD WHICH IS NOT ONLY AUTHORISED TO GRANT CONCESSION, ENTER INTO AGR EEMENT WITH THE CONCESSIONAIRE BUT ALSO TO COLLECT THE CONCESSION F EE / TOLL FEE FROM THE CONCESSIONAIRE. HE IN THIS RESPECT HAS INVITED OUR ATTENTION TO SECTION 20(4) OF THE PUNJAB INFRASTRUCTURE (DEVELOPMENT & REGULATION) AC T, 2002 WHICH, READS AS UNDER:- (4) IN ORDER TO CARRY OUT ITS FUNCTIONS CONSISTENT WITH THE PROVISIONS OF THIS ACT THE BOARD SHALL HAVE THE POW ERS TO DO ALL OR ANY OF THE FOLLOWING, NAMELY:- (I) ACQUIRE, HOLD, DEVELOP OR CONSTRUCT SUCH PROPERTY, BOTH MOVABLE AND IMMOVABLE, AS THE BOARD MAY DEEM NECESSARY FOR THE PERFORMANCE OF ANY OF ITS ACTIVIT IES RELATED TO THE DEVELOPMENT OF INFRASTRUCTURE SECTOR S OL INFRASTRUCTURE PROJECTS; (II) ADVISE OR RECOMMEND TO THE STATE GOVERNMENT ITA NOS. 880, 881 & 9-C-13, 788 TO 7891-C-2014- PUNJAB INFRASTRUCTURE DEVELOPMENT BOARD, CHANDIGARH 10 ACQUISITION OF LAND UNDER THE LAND ACQUISITION ACT. , 1894 FOR THE PURPOSES OF INFRASTRUCTURE PROJECTS; (III) LEASE, SELL, EXCHANGE, OR OTHERWISE MAKE ALLO TMENTS OF THE PROPERTY REFERRED TO IN CLAUSE (I) TO CONCESSIO NAIRE AND TO MODIFY OR RESCIND ALLOTMENT, INCLUDING THE R IGHT AND POWER TO EVICT THE ALLOTTEES CONCERNED ON BREAC H OF ANY OF THE TERMS OR CONDITIONS OF SUCH ALLOTMENT; (IV) BORROW AND RAISE MONEY IN SUCH MANNER AS THE B OARD MAY THINK FIT AND TO SECURE THE REPAYMENT OF ANY MO NEY BORROWED, RAISED OR OWING BY MORTGAGE, CHARGE, STANDARD SECURITY, LIEN OR OTHER SECURITY UPON THE WHOLE OR ANY PART OF THE BOARDS PROPERTY OR ASSETS @WHET HER PRESENT OR FUTURE), AND ALSO BY A SIMILAR MORTGAGE, CHARGE, STANDARD SECURITY, LIEN OR SECURITY TO SECU RE AND GUARANTEE THE PERFORMANCE BY THE BOARD OF ANY OBLIGATION OR LIABILITY, IT MAY HAVE UNDERTAKEN OR WHICH MAY BECOME BINDING ON IT; (V) CONSTITUTE A PROJECT MANAGEMENT TEAM AND ONE OR MOR E ADVISORY COMMITTEE OR COMMITTEES OR SECTORAL SUB- COMMITTEE OR PROJECT IMPLEMENTATION SUB-COMMITTEE, OR ENGAGE SUITABLE SERVICE PROVIDERS OR ADVISORS OR CONSULTANTS TO ADVISE THE BOARD FOR THE EFFICIENT DISCHARGE OF ITS FUNCTIONS; (VI) ENTER INTO AND PERFORM ALL SUCH CONTRACTS AS IT MAY THINK NEE EXPEDIENT FOR PERFORMING ANY OF ITS FUNCTIONS; AND (VII) DO SUCH OTHER THINGS AND PERFORM SUCH OTHER ACTS AS IT MAY THINK NECESSARY OR EXPEDIENT FOR THE PROPER CON DUCT OF ITS FUNCTIONS AND FOR CARRYING INTO EFFECT THE P URPOSES OF THIS ACT. 12. HE FURTHER HAS INVITED OUR ATTENTION TO SECTION 34 (7) OF THE PI (D&R) ACT, 2002, WHICH READS AS UNDER:- (7) IN THE CASE OF INFRASTRUCTURE PROJECTS BASED O N PRIVATE PARTICIPATION SCHEMES, THE BOARD SHALL AWAR D THE CONTRACT TO THE BIDDER WHOSE PROPOSED TOLLS OR FEES OR RENTALS OR CHARGES OR PERIOD OF CONCESSION IN RESPECT OF MODELS OF CONTRACT (SHORTLY INDICATED AS BOT, BOO, CAO, DOT, ROT, ROO IN SCHEDULE II) AND OTHER SIMILAR SCHEMES OR PROPOSED SCHEDULE OF AMORTIZATION PAYMENTS IN RESPECT OF BT,BLT,BTO (AS SHORTLY INDICATED IN SCHEDULE II) AND OTHER SIMILAR SCHEMES ARE DETERMINED TO HAVE THE LOWEST PRESENT VALUE. ITA NOS. 880, 881 & 9-C-13, 788 TO 7891-C-2014- PUNJAB INFRASTRUCTURE DEVELOPMENT BOARD, CHANDIGARH 11 13. FURTHER, ATTENTION HAS BEEN INVITED TO THE RELE VANT PROVISIONS OF SECTION 35 OF THE SAID ACT WHICH READS AS UNDER:- 35. GRANT OF CONCESSION : (1) THE CONCESSION SHALL BE GRANTED BY A PUBLIC INFRASTRUCTURE AGENCY TO A BIDDER WHO:- . (3) IMMEDIATELY AFTER THE COMPLETION OF THE SECOND STAGE EVALUATION, A DECISION ON WHETHER OR NOT TO AWARD T HE CONTRACT SHALL BE TAKEN BY THE BOARD. (4) IF THE BOARD TAKES A DECISION TO AWARD THE CONT RACT, THE BOARD SHALL ISSUE TO THE PROPOSED AWARDEE, THE NOTICE OF AWARD IMMEDIATELY AFTER SUCH DECISION. 14. IN VIEW OF THE ABOVE, THE LD. DR HAS SUBMITTED THAT IT IS THE ASSESSEE BOARD WHO HAS BEEN AUTHORISED TO ENTER INTO CONTRAC T, RECEIVE THE CONSIDERATION / TOLL FEE / CONCESSION FEE ETC. BY WHATEVER NAME IT IS SO CALLED. THAT THE ASSESSEE BOARD IS AN INDEPENDENT CORPORATE ENTITY. THAT THE PAYMENT, IF ANY, WAS RECEIVED BY IT WAS ON ITS OWN BEHALF AND NOT ON BEHALF OF THE GOVERNMENT OF PUNJAB AND FURTHER THAT CONSIDERATION RECEIVED BY THE BOARD HAS NOT BEEN DEPOSITED TO THE GOVERNM ENT FUND, RATHER, THE SAME HAS BEEN USED BY THE ASSESSEE BOARD FOR ITS OW N PURPOSES. 15. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND AL SO HAVE GONE THROUGH THE RELEVANT CLAUSES OF THE CONCESSION AGREEMENT AS WELL AS THE RELEVANT PROVISIONS OF THE PI (D&R) ACT, 2002. THOUGH ON PERUSAL OF THE AGREEMENT IT APPEARS THAT THE ASSESSEE BOARD IS JUST A NODAL AGENCY AS CONFIRMING PARTY AND THAT THE AGREEMENT HAS BEEN ENTERED INTO BETWEEN THE GOVERNMENT OF PUNJAB AND THE CONCESSIONAIRE, HOWEVE R, ON THE DEEPER ITA NOS. 880, 881 & 9-C-13, 788 TO 7891-C-2014- PUNJAB INFRASTRUCTURE DEVELOPMENT BOARD, CHANDIGARH 12 SCRUTINY OF THE RELEVANT FACTS AND OF THE ACTUAL AC TIVITIES AND FUNCTIONS CARRIED OUT BY THE ASSESSEE BOARD, IT REVEALS THAT , IN FACT, THE AFORESAID AGREEMENT IS JUST A PAPER DOCUMENT SHOWN TO BE EXE CUTED BETWEEN THE GOVERNMENT OF PUNJAB AND THE CONCESSIONAIRE. HOWEVE R, ACTUALLY THE ASSESSEE-BOARD, ITSELF, IS ACTING AS THE GRANTOR IN ITS INDEPENDENT CAPACITY ON PRINCIPLE TO PRINCIPLE BASIS. 16. ON 7.3.2019, DURING THE HEARING OF THE MATTER, A STRAIGHT AND DIRECT QUESTION WAS ASKED TO THE LD. COUNSEL FOR THE ASSES SEE SHRI DEEPAK AGGARWAL, WHO WAS BEING FURTHER ASSISTED IN THE CO URT BY OFFICIALS OF THE BOARD AS TO IF THE BOARD WAS ACTING JUST AS A NODA L AGENCY / CONFIRMING PARTY, IN WHAT CAPACITY IT HAD RECEIVED THE TOLL F EE / CONCESSION FEE / THE AMOUNT IN QUESTION FROM THE CONCESSIONAIRE? FURTH ER, THAT AS TO WHETHER THE AMOUNT RECEIVED BY IT WAS DEPOSITED IN THE GOV ERNMENT FUND OR WAS USED BY THE BOARD ITSELF? THE LD. COUNSEL, HOWEVER, SOUGHT TIME TO GET APPROPRIATE INSTRUCTIONS FROM THE ASSESSEE BOARD. ON THE NEXT DAY OF HEARING, HE ALONG WITH OTHER OFFICIALS OF THE BOARD COULD NOT SATISFACTORILY EXPLAIN IN THIS RESPECT, RATHER, IT WAS ADMITTED TH AT IT WAS THE ASSESSEES BOARD WHICH WAS COLLECTING THE TOLL FEE / CONCESSIO N FEE FROM THE CONCESSIONAIRE AND FURTHER THAT THE AMOUNT SO COL LECTED WAS DEPOSITED IN THE OWN FUNDS / USED BY THE BOARD AND WAS NOT DEPO SITED WITH THE GOVERNMENT OF PUNJAB. 17. THOUGH, THE LD. COUNSEL FOR THE ASSESSEE BOAR D TRIED TO CONVINCE US FROM THE AGREEMENT AS WELL AS FROM THE RELEVAN T STATUTORY PROVISIONS THAT IT WAS JUST A NODAL AGENCY OF THE GOVERNMENT A ND BEING SO, WAS THE CONFIRMING PARTY IN THE AGREEMENT AND THAT THE AGRE EMENT, IF ANY, HAS BEEN ITA NOS. 880, 881 & 9-C-13, 788 TO 7891-C-2014- PUNJAB INFRASTRUCTURE DEVELOPMENT BOARD, CHANDIGARH 13 EXECUTED BETWEEN THE GOVERNMENT OF PUNJAB AND THE CONCESSIONAIRE AND THAT IT IS THE GOVERNMENT OF PUNJAB WHICH IS ENTITL ED TO GRANT THE CONCESSION AND COLLECT CONCESSION FEE / TOLL FEE BY WHATEVER NAME IT IS CALLED, HOWEVER, WE FIND THAT PRACTICALLY IT IS THE ASSESSEE BOARD WHICH HAS COLLECTED THE TOLL FEE / CONCESSION FEE AND IT IS P ERFORMING SUCH DAY TO DAY ACTIVITIES AS A GRANTOR OF THE CONCESSION ON PRIN CIPLE TO PRINCIPLE BASIS AND EVEN THE SO COLLECTED TOLL FEE / CONCESSION FE E HAS BEEN USED / APPLIED BY THE BOARD FOR ITS OWN PURPOSES / DEPOSITED IN I TS OWN FUNDS AND HAS NOT BEEN DEPOSITED WITH THE GOVERNMENT OF PUNJAB. NOW COMING TO THE STATUTORY PROVISIONS, FROM THE RE ADING OF THE ENTIRE STATUTORY PROVISIONS OF THE ACT, IT REVEALS THAT THE PROVISIONS OF PI (D&R) ACT 2002, ARE ALL THE MORE AMBIGUOUS, CONFUSING AND CRYPTIC AND LEAD TO UNCLEAR, INDETERMINATE, VAGUE AND ABSURD I NTERPRETATION. IN SOME OF THE PROVISIONS IT HAS BEEN MENTIONED THAT IT IS THE GOVERNMENT OF PUNJAB WHICH HAS TO CARRY OUT DEVELOPMENT PROJECTS AND THAT THE BOARD WILL ACT AS A NODAL AGENCY, WHEREIN, IN THE OTHER PROVISIONS AS DISCUSSED ABOVE, THE BOARD HAS BEEN AUTHORISED NOT ONLY FOR THE IDENTIFICATION OF THE SITES / ROADS / DEVELOPMENT OF PROJECTS BUT ALSO HA S BEEN GIVEN THE RESPONSIBILITY OF THE DEVELOPMENT OF THE PROJECTS, CALLING FOR BIDS FOR PUBLIC PRIVATE PARTNERSHIP, POWER TO ACQUIRE HOLD, DEVELOP OR CONSTRUCT BOTH IMMOVABLE AND IMMOVABLE PROPERTY AS THE BOARD DEEM NECESSARY FOR PERFORMANCE OF ANY OF ITS OBJECTS RELATING TO THE D EVELOPMENT OF THE INFRASTRUCTURE SECTOR OR INFRASTRUCTURE PROJECTS. IT IS AUTHORISED TO LEASE, SELL, EXCHANGE OR OTHERWISE MAKE ALLOTMENT OF THE P ROPERTY TO THE CONCESSIONAIRE AND TO MODIFY OR RESCIND ALLOTMENTS INCLUDING THE RIGHT AND POWER TO EVICT THE ALLOTTEES CONCERNED ON BREACH OF ANY OF THE TERMS AND ITA NOS. 880, 881 & 9-C-13, 788 TO 7891-C-2014- PUNJAB INFRASTRUCTURE DEVELOPMENT BOARD, CHANDIGARH 14 CONDITIONS OF SUCH ALLOTMENT, ENTER INTO AND PERFOR M ALL SUCH CONTRACTS AS IT MAY THINK NECESSARY FOR PERFORMING ANY OF ITS FU NCTIONS. A PERUSAL OF THE DIFFERENT PROVISIONS OF THE ACT REVEALS THAT THERE IS AN OVERLAPPING, CONFUSION AND INTERCHANGING OF THE POWERS AND FUNCT IONS OF THE GOVERNMENT AND THE BOARD AND, HENCE, THE PROVISIONS OF THE PI (D&R) ACT, 2002 ARE NOT CAPABLE OF BEING GIVEN A SIMPLE AND PLAIN MEANING AND INTERPRETATION. 18. CONSIDERING THE ACTUAL ACTIVITY PERFORMED BY TH E ASSESSEE BOARD AND OTHER SURROUNDING CIRCUMSTANCES, IT IS APPARENT AND CLEAR THAT THE BOARD HAS ACTED AS A GRANTOR OF THE CONCESSION ON ITS OWN ACCOUNT ON A PRINCIPLE TO PRINCIPLE BASIS WITH THE CONCESSIONAIRE AND H AS BEEN PERFORMING ALL THE FUNCTIONS ACTUALLY AND PRACTICALLY OF THE GRANT ER OF THE CONCESSION AGREEMENT. AT THIS STAGE, , WE ARE OF THE VIEW, TH AT THE IRRESPECTIVE OF THE WORDINGS OF THE CONCESSION AGREEMENT OR THE CONFUSI ON AND AMBIGUITY COMING OUT OF THE PROVISIONS OF THE PI (D&R) ACT 20 02, THE FACT RELEVANT FOR DETERMINATION OF THE PRESENT TAX DISPUTE IS THA T THE ASSESSEE BOARD HAD COLLECTED THE TOLL FEE OR TO SAY CONCESSION FEE IN ITS OWN CAPACITY AS AN INDEPENDENT BODY CORPORATE AND HAD USED THE FUNDS F OR ITS OWN PURPOSES AND ACTIVITIES, AND AS SUCH, THE ASSESSEE BOARD ( P DBI) FALLS UNDER THE DEFINITION OF LICENSOR AND HAS ACTED AS A GRANTOR O F THE LICENSEE /CONTRACT IN THE TOLL PLAZA TO THE CONCESSIONAIRE AND HAS REC EIVED FROM THE LICENSEE / CONCESSIONAIRE THE CONSIDERATION FOR THE AWARD OF SAID CONTRACT AND, AS SUCH, IT WAS LIABLE TO COLLECT TAX AT SOURCE AS PE R THE PROVISIONS OF SECTION 206C (1C)OF THE ACT. ITA NOS. 880, 881 & 9-C-13, 788 TO 7891-C-2014- PUNJAB INFRASTRUCTURE DEVELOPMENT BOARD, CHANDIGARH 15 19. SO FAR AS THE CONTENTION OF THE LD. COUNSEL FOR THE ASSESSEE THAT IT WAS NOT MERELY GRANT OF USAGE OF TOLL PLAZA, RATHER , THE CONCESSIONAIRE WAS RESPONSIBLE FOR THE OVERALL OPERATION AND MAINTENAN CE OF THE PROJECT FACILITY, IS CONCERNED, THE LD. COUNSEL FOR THE ASS ESSEE COULD NOT ESTABLISH FROM THE EVIDENCE OR DOCUMENTS ON RECORD THAT AS TO WHY THESE AGREEMENT BE NOT TREATED AS AGREEMENT FOR GRANT OF LICENSE / TOLL RIGHTS AS PER THE PROVISIONS OF SECTION 206 C(1C) OF THE ACT. A PER USAL OF THE LICENSE /CONCESSION AGREEMENTS RELATING TO THESE APPEALS, CONSIDERING THE NATURE, SCOPE AND AMBIT OF THE AGREEMENT AND ALSO CONSIDERI NG THE ACTUAL ACTIVITY CARRIED ON BY THE ASSESSEE PIDB, WE ARE OF THE FIR M VIEW THAT THE PROVISIONS OF SECTION 206C(1C) ARE SQUARELY APPLICA BLE TO THE CASE IN HAND. BEING HELD SO, THE ASSESSEE PIDB. AS PER THE LAW L AID DOWN BY THE HON'BLE PUNJAB & HARYANA HIGH COURT, IS HELD TO B E LIABLE TO PAY INTEREST AS PER THE PROVISIONS OF SECTION 206C(7) AND PENALT Y UNDER THE PROVISIONS OF SECTION 271CA OF THE ACT. 20. IN VIEW OF THE ABOVE, THE ISSUE RESTORED BY THE HON'BLE HIGH COURT TO THE TRIBUNAL, IS DECIDED AGAINST THE ASSESSEE AND I N FAVOUR OF THE REVENUE. 21. BEFORE PARTING WITH THE ORDER, IT IS PERTINENT TO NOTE HERE THAT THOUGH THE HON'BLE HIGH COURT HAS DIRECTED THE TRIB UNAL TO DECIDE THE APPEALS ON THE DATE OF HEARING I.E. 7.3.2019 OR WIT HIN 10 DAYS THEREAFTER, HOWEVER, DUE TO INABILITY OF THE COUNSE L OF THE ASSESSEE AND OFFICIAL OF THE DEPARTMENT TO ANSWER THE RELEVA NT QUERIES RAISED BY THE BENCH ON THE DATE OF HEARING, AN ADJOURNMENT WAS SOUGHT AND, THEREFORE, THE CASE WAS ADJOURNED TO 13.3.2019. THE CASE WAS ACCORDINGLY HEARD ON 13.3.2019, HOWEVER, THE APPEA LS COULD NOT BE ITA NOS. 880, 881 & 9-C-13, 788 TO 7891-C-2014- PUNJAB INFRASTRUCTURE DEVELOPMENT BOARD, CHANDIGARH 16 DECIDED WITHIN THE STIPULATED TIME AS CONSIDERABLE TIME HAS BEEN TAKEN TO GO THROUGH AND CONSIDER THE VOLUMINOUS EVI DENCES, DOCUMENTS INCLUDING CONTRACTS ETC., AND OTHER RELEV ANT DOCUMENTS INVOLVED. HOWEVER, EVERY ENDEAVOR WAS MADE BY THE B ENCH TO DECIDE THE APPEAL AS PROMPTLY AS POSSIBLE. ALL THE APPEALS ARE, THEREFORE, DISPOSED OFF ACCORD INGLY. ORDER PRONOUNCED IN THE OPEN COURT ON 29.03.2019. SD/- SD/- ( $ % & '# / ANNAPURNA GUPTA) () / ACCOUNTANT MEMBER ( / SANJAY GARG) / JUDICIAL MEMBER ,$ /DATE: 29. 03.2019 . . #& ' () *) / COPY OF THE ORDER FORWARDED TO : 1. + / THE APPELLANT 2. ',+ / THE RESPONDENT 3. - / CIT 4. - ( )/ THE CIT(A) 5. )./ ' 0 , ! 0 , 123/4 / DR, ITAT, CHANDIGARH 6. /3 5 / GUARD FILE #& / BY ORDER, 6 / ASSISTANT