ACIT, Khanna V. Sh. Hardev Singh, Machhiwara

ITA 883/CHANDI/2010

• Counselvise Citation: 88321514 RSA 2010
• Duration Of Justice: 1 year(s) 10 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-05-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 22-03-2012
• Assessment Year: 2006-2007
• Appeal Filed On: 07-06-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: JAI SHREE SHARMA
• Keywords: Rectification of order; Additional evidence
• Section: 143(3); 54; 154

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL CHANDIGARH BENCH B CHANDIGARH BEFORE SHRI H.L.KARWA, VICE PRESIDENT AND SHRI MEHAR SINGH, ACCOUNTANT MEMBER ITA NO.837/CHD/2008 ASSESSMENT YEAR: 2002-03 M/S PUNJAB URBAN DEVELOPMENT V ACIT, C-2(1), AUTHORITY, PUDA BHAWAN, CHANDIGARH. SECTOR 62, MOHALI. PAN : AAALP-0045J (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI PARIKSHIT AGGARWAL RESPONDENT BY : SMT.JAI SHREE SHARMA DATE OF HEARING : 09.04.2012 DATE OF PRONOUNCEMENT : 07.05.2012 ORDER PER MEHAR SINGH, AM THE PRESENT APPEAL HAS BEEN FILED BY THE ASSESSEE AGAINST THE ORDER DATED 21.07.2008 PASSED BY THE LD . CIT(A) U/S 250 OF THE INCOME-TAX ACT,1961 (IN SHORT 'THE A CT'). 2. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL: 1. THAT THE WORTHY CIT (A) HAS ERRED IN PASSING THE ORD ER U/S 154 OF THE INCOME TAX ACT, 1961. 2. THAT THE WORTHY COMMISSIONER OF INCOME TAX (AP PEALS) HAS NOT GIVEN ANY COMMENT AND CLEAR VIEW ON GROUND N O.2 & 3 OF THE APPELLANT AS UNDER:- - 'THAT THE RECTIFICATION OF INTIMATION U/S 143 (1) (A) OF THE I.T. ACT BY INVOKING THE PROVISION OF SECTION 154/155 IS ILLEGAL AND BAD IN THE EYES OF LAW. 'THAT THE DISALLOWANCE OF CREDIT OF TDS WHILE FRAMING RECTIFICATION ORDER U/S 154/155 IS ILLEGAL AND OUTSID E THE PROVISION OF INCOME TAX ACT, 1961. THAT THE TDS CERT IFICATE 2 WITH COMPLETE PARTICULARS AND INFORMATION HAVE BEEN PROVIDED TO THE LD. ASSESSING OFFICER FROM TIME TO TIME.' (I) THUS, THE ORDER AS PASSED U/S 154 OF THE ACT IS BAD IN LAW. 3. THAT THE WORTHY COMMISSIONER OF INCOME TAX (APPEALS) WHILE PASSING THE ORDER HAS GIVEN THE FINDINGS IN PAR A-8 OF THE ORDER AS UNDER:- 'THIS ISSUE IS DEBATABLE IN NATURE AND THE APPEAL AGAIN ST RECTIFICATION U/S 154 WHERE SUBJECT MATTER IS DEBATA BLE CANNOT BE ALLOWED.' (I) IN THIS RESPECT, IT IS SUBMITTED THAT EITH ER TDS CERTIFICATE IS CORRECT OR INCORRECT, IT CANNOT BE DEBATABLE ISSU E. EVEN IF, IT IS PRESUMED THAT THE ISSUE IN QUESTION WAS DEBATABLE TH EN, HOW, THE LD. ASSESSING OFFICER PASSED THE ORDER U/S 154 O F THE DEBATABLE ISSUE, AS RECTIFICATION U/S 154 CAN BE PAS SED ONLY OF ISSUE/MISTAKE WHICH IS APPARENT FROM RECORD AND NOT OF DEBATABLE ISSUE. 4. THAT THE WORTHY COMMISSIONER OF INCOME TAX (APPEA LS) RELIED UPON THE VARIOUS CONTENTION OF THE ASSESSING OFFICER THAT CERTAIN TDS CERTIFICATES DID NOT BEAR THE SIGNATURE S OF THE ISSUING AUTHORITY OR WERE RELATED TO SOME OTHER ASSESSMENT YEAR, WITHOUT FURTHER ENQUIRING FROM THE ASSESSING OFFICE R OR FROM THE APPELLANT ABOUT THE EXACT PARTICULARS OF THE TDS CE RTIFICATES AND ALSO, IF THEY WERE SUBSEQUENTLY RECTIFIED AFTER BEI NG SIGNED BY THE ISSUING AUTHORITY THEN THE RELIEF OF TDS OUGHT T O BE GIVEN FOR THESE YEARS. AS SUCH, THE ORDER OF THE CIT (A) IS INCONCLUSIVE . 5. THAT THE WORTHY COMMISSIONER OF INCOME TAX (APPEAL S) HAS WRONGLY ENDORSED THE VIEW OF THE ASSESSING AUTH ORITY THAT THE SERVICE OF NOTICE U/S 154 WAS CORRECTLY MADE AN D NO OBJECTION FOR RECTIFICATION WAS PROPERLY GIVEN THROU GH THE COUNSEL OF THE ASSESSEE WAS NEVER INSTRUCTED TO GIVE NO OBJECTIO N. 6. THAT THE APPELLANT CRAVES LEAVE TO ADD OR AMEND ANY GROUNDS OF APPEAL BEFORE THE APPEAL IS FINALLY HEARD OR DISPOSED OFF. 3. IN THE COURSE OF PRESENT APPELLATE PROCEEDINGS B EFORE THE BENCH, BOTH LD. 'AR' AND LD. 'DR' WERE OF THE O PINION 3 THAT THE CORE ISSUE PERTAINING TO TDS CERTIFICATES, BE RESTORED TO THE FILE OF THE AO, FOR THE PURPOSE OF DUE VERIFICATION, IN RESPECT OF CERTAIN DEFECT IN TDS C ERTIFICATES. LD. 'DR' REFERRED TO THE DECISION OF THE HON'BLE HI GH COURT DATED 27.09.2010 IN ITA 122 OF 2010 O&M, WHEREBY TH E HON'BLE HIGH COURT RESTORED THE MATTER TO THE TRIBU NAL FOR ADJUDICATING THE ISSUES, AFTER CONDONING THE DELAY. 4. THE FINDINGS OF THE LD. CIT(A), AS CONTAINED IN APPELLATE ORDER PASSED ON 21.07.2008 ARE REPRODUCED HEREUNDER : 5. I HAVE CAREFULLY CONSIDERED THE ORDER AS WELL AS SUBMISSIONS OF THE ASSESSEE. THE CIRCUMSTANCES REVEA L THAT THE ASSESSEE HAS BEEN SERVED THE ORDER U/S 154 ON T HE SAME DAY WHEN THE COUNSEL OF THE ASSESSEE GAVE HIS NO OB JECTION. THE ASSESSEE DID NOT OBJECT TO ANY KIND OF MISTAKE IN THE ORDER U/S 143(3) WHICH WAS SERVED ON THE ASSESSEE ON 14/11/200 3. MOREOVER, IT MAY BE MENTIONED THAT THE CALCULATIONS WHICH HAVE BEEN MADE IN ORDER U/S 154 HAVE GOT MERGED IN THE ORDER U /S I43(3) BECAUSE RECOMPUTATION IS ALWAYS DONE AFTER ORDER U/ S 143(3). THE ASSESSEE DID NOT MAKE ANY APPEAL IN REGARD TO THE CO MPUTATION OF CREDIT OF TDS IN THE REGULAR APPEAL FOR A.Y. 2002-0 3. THE FILING OF APPEAL ON 8.3.2007 IS DELAYED. ON THE FACTS AND PECUL IAR CIRCUMSTANCES OF THE CASE, THE DELAY IN FILING OF A PPEAL IS NOT CONDONED. 6. WITHOUT PREJUDICE TO THE ABOVE, THE APPEAL OF THE ASSESSEE IS ALSO DECIDED ON MERITS. THE PROCESSING U /S 143(L)(A) WAS DONE ON 28/2/03 DETERMINING REFUND OF RS.2656974/-. LATER ON, IT WAS FOUND BY THE ASSESSIN G OFFICER THAT CERTAIN TDS CERTIFICATES DID NOT BEAR THE SIGNATURE OF ISSUING AUTHORITY OR WERE RELATED TO SO ME OTHER ASSESSMENT YEAR. A NOTICE U/S 154/145 WAS ISSUED TO T HE ASSESSING OFFICER. THE COUNSEL OF THE ASSESSEE ATTENDED THE OFFICE AND GAVE NO OBJECTION FOR RECTIFICA TION. 4 CONSEQUENTLY, TDS ALREADY ALLOWED WAS WITHDRAW N AND THE ASSESSING OFFICER RE-DETERMINED THE REFUND OF RS. 109690/-, A COPY OF THE NOTICE U/S 1 54 AND ALSO THE NO OBJECTION GIVEN BY THE COUNSEL OF THE ASSESSEE IS AN NEXED AS ANNEXURE-2 AND ANNEXURE-3 RESPECTIVELY. 7. THE ASSESSEE HAS DISPUTED THAT THE COUNSEL OF THE ASSESSEE WAS NEVER INSTRUCTED TO REPRESENT THE CASE OF THE ASSESSEE WHEREAS THE A.O, HAS GIVEN HIS REASONS THA T HE WAS THE AUTHORIZED REPRESENTATIVE. THE ASSESSING OFF ICER HAS SENT HIS REPORT VIDE LETTER DATED 5/11/ 2007 WHEREI N II WAS SUBMITTED (THAT THE COUNSELS IN THE CASE OF PUDA HA VE BEEN CHANGING IN THE PAST YEAR. IT WAS FURTHER SUBMITTED T HAT ON THE SAME ISSUE, A REQUEST FOR RECTIFICATION OF MISTA KE FOR THE A.Y. 2001-02 WAS FILED BY THE ASSESSEE ON 12/3/2007. T HE APPLICATION DATED 12/3/2001 WAS REJECTED AS IT HAD G OT TIME BARRED. IT WAS FURTHER SUBMITTED BY THE ASSESS ING OFFICER THAT THE ASSESSEE HAD BEEN CHANGING ITS STA NCE ON THIS ISSUE. THE ASSESSING OFFICER STATED THAT THE EARLI ER STAND TAKEN BY THE ASSESSEE WAS THAT IT HAD REMOVED THE DISCREPANCY REGARDING TDS CERTIFICATES AND THUS (HE C REDIT OF THESE CERTIFICATES MAX 1 BE ALLOWED FOR THE A.Y. 2001-02. THE ASSESSING OFFICER FURTHER SUBMITTED THAT NOW THE AS SESSEE HAS CHANGED ITS STAND BY STATING THAT THE SIGNATURE IN THE NOTICE DATED 14/8/2003 ARE NEITHER OF ITS COUNSEL NOR OF ANY AUTHORIZED PERSON. 8 THIS ISSUE IS DEBATABLE IN NATURE. THE APPEAL AGAINST RECTIFICATION U/S 154 WHERE SUBJECT MATTER IS DEBAT ABLE CANNOT BE ALLOWED, IT IS ALSO A MATTER OF FACT THAT CERTAIN CERTIFICATES WERE NOT RELATED TO THE RELEVANT ASSESSMENT YEAR AND ALS O CERTAIN CERTIFICATES WERE DEFECTIVE. THE ASSESSING OFFICER WI THDRAW THE CREDIT FOR T DS WHILE PASSING ORDER U/S I54. THE COUNSEL OF THE ASSESSEE NOW COULD NOT POINT OUT ANY MISTAKE IN THE ORDER U/S 154.. THEREFORE, THE ASSESSEE CANNOT SUCCEED WHERE THE ISS UE IS DEBATABLE AND THE ASSESSEE COULD NOT POINT OUT ANY MISTA KE 5 9 MOREOVER, WHATEVER CALCULATIONS WERE MADE WHILE PA SSING ORDER LI / S 154,GOT MERGED IN THE ORDER U/S 143(3) DATED 12/11/2003 WHICH WAS SERVED ON THE ASSESSEE ON 14.11. 2003. IF THE ASSESSEE WAS AGGRIEVED, HE COULD HAVE AGAIN TAK EN A GROUND OF APPEAL FOR NON GIVING OF' CREDIT OF TDS IN THIS ASSES SMENT YEAR, WHILE FILING APPEAL AGAINST THE ORDER U/S 143(3). TH IS ALSO SHOWS THAT THE ASSESSEE WAS WELL AWARE OF THE CREDIT OF LA X BEING GIVEN TO THE ASSESSEE. 5. LD. CIT(A) HAS REJECTED THE RECTIFICATION APPLIC ATION FILED BY THE ASSESSEE ON THE GROUND THAT THE ISSUE INVOLV ED IS IN THE NATURE OF DEBATABLE ISSUE. 6. WE HAVE CAREFULLY PERUSED THE RIVAL SUBMISSIONS, FACTS OF THE CASE AND THE RELEVANT RECORD. THE RELEVANT PART OF THE DECISION, INCLUDING THE OBSERVATION OF HON'BLE JURI SDICTIONAL HIGH COURT IN ITA NO. 122 OF 2010 O&M DATED 22.09.2 010, WHEREBY IT HAS BEEN HELD THAT AFTER CONDONING THE D ELAY, ISSUE MAY BE CONSIDERED ON MERITS. THE RELEVANT PA RT OF THE SAME IS REPRODUCED HEREUNDER : 6. AFTER GIVING OUR THOUGHTFUL CONSIDERATION TO TH E RESPECTIVE SUBMISSIONS OF LD. COUNSEL FOR THE PARTI ES, KEEPING IN VIEW TOTALITY OF PECULIAR FACTS AND CIRCUMSTANCES OF THE CASE AND IN THE INTEREST OF JU STICE AND MORE PARTICULARLY, IN THE ABSENCE OF ANY LEGAL AUTHORIZATION TO THE CHARTERED ACCOUNTANT TO GIVE NO OBJECTION FOR RECTIFICATION, THE MATTER DESERVED T O BE DECIDED ON MERITS AFTER CONDONING THE DELAY. FURTHE R, IN THE LIGHT OF THE DOCUMENTS FILED ALONGWITH THE APPLICATION, WE ARE OF THE OPINION THAT THE MATTER REQUIRES TO BE REMANDED TO THE TRIBUNAL TO DECIDE AFRESH ON MERITS AFTER EXAMINING THE EVIDENCE AVAIL ABLE ON RECORD AND WHICH MIGHT BE PRODUCED BY THE ASSESSEE, IF PERMISSIBLE UNDER RULE 29 OF THE INCOM E 6 TAX (APPELLATE TRIBUNAL)RULES, 1963 BY WAY OF ADDITIONAL EVIDENCE. 7. LD. CIT(A) DID NOT CONDONE THE DELAY, AS IS EVID ENT FROM PARA 5 OF HIS FINDINGS, REPRODUCED EARLIER. 8. HAVING REGARD TO THE PECULIAR FACTS OF THE CASE AND THE OBSERVATIONS MADE BY THE HON'BLE JURISDICTIONAL HIG H COURT, KEEPING IN VIEW THE TOTALITY OF PECULIAR FACTS AND CIRCUMSTANCES OF THE CASE, AND IN THE INTEREST OF J USTICE, AND MORE PARTICULARLY, IN THE ABSENCE OF ANY LEGAL AUTH ORIZATION OF THE CHARTERED ACCOUNTANT TO GIVE NO OBJECTION FOR RECTIFICATION, THE MATTER WAS REMANDED FOR CONDONIN G THE DELAY AND ADJUDICATION ON MERIT. 9. IN VIEW OF FACTS THAT NO OBJECTION WAS GIVEN B Y THE UNAUTHORIZED REPRESENTATIVE OF THE ASSESSEE, THE DE LAY IS CONDONED. 10. IN THE COURSE OF PRESENT ASSESSMENT PROCEEDINGS , LD. 'AR' CONTENDED THAT THE TDS CERTIFICATES SUFFERED F ROM CERTAIN DEFECTS, WHICH NEEDS CLOSE EXAMINATION AND VERIFICATION AND HENCE, THE ISSUE CANNOT BE ADJUDIC ATED WITHOUT SUCH EXAMINATION, ENQUIRY AND VERIFICATION. LD. 'AR' WAS ALSO OF THE VIEW THAT IN THE ABSENCE OF SU CH ENQUIRY, EXAMINATION AND VERIFICATION, IT MAY NOT B E POSSIBLE TO ADJUDICATE THE ISSUE ON MERIT. BOTH LD. 'DR' AN D LD. 'AR' STATED THAT ISSUE BE RESTORED TO THE FILE OF THE AO FOR THIS PURPOSE. ACCORDINGLY, WE DEEM IT FIT TO RESTORE TH E ISSUE IN QUESTION, TO THE FILE OF AO, FOR FRESH ADJUDICATION , AFTER MAKING NECESSARY EXAMINATION, ENQUIRY AND VERIFICAT ION OF 7 THE TDS CERTIFICATE, AS DEEMED FIT. THE AO IS REQU IRED TO AFFORD PROPER AND REASONABLE OPPORTUNITY, TO THE AS SESSEE, AND THE ASSESSEE IS ALSO DIRECTED TO RENDER NECESSA RY COOPERATION IN THE MATTER. ACCORDINGLY, THE ISSUE IS RESTORED TO THE FILE OF THE AO. 11. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWE D FOR STATISTICAL PURPOSES ONLY. ORDER PRONOUNCED IN THE OPEN COURT ON 7 TH MAY,2012. SD/- SD/- (H.L.KARWA) (MEHAR SINGH) VICE PRESIDENT ACCOUNTANT MEMBER DATED: 7 TH MAY.2012. POONAM COPY TO: THE APPELLANT, THE RESPONDENT, THE CIT(A), THE CIT ,DR ASSISTANT REGISTRAR, ITAT CHANDIGARH