ACIT, Sikar V. SIKAR & JHUNJHUNU ZILA DUGDH UTPADAK SAHAKARI SANGH LTD., Sikar

ITA 950/JPR/2016

• Counselvise Citation: [2017] 130 COUNSELVISE.COM (IT) 5660 (ITAT-JAIPUR)
• Duration Of Justice: 2 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-01-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: misc
• Appeal Filed On: 04-11-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R A VERMA
• Assessee Lawyers: P C PARWAL CA DHK

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES , JAIPUR JH HKKXPUN] YS[KK LNL; ,O JH DQY HKKJR] U;KF;D L NL; DS LE{K BEFORE: SHRI BHAGCHAND, AM & SHRI KUL BHAR AT, JM VK;DJ VIHY LA-@ ITA NO. 950/JP/2016 FU/KZKJ.K O'K Z@ ASSESSMENT YEAR : 2013-14 THE ACIT CIRCLE- SIKAR SIKAR CUKE VS. M/S. SIKAR & JHUNJHUNU ZILA DUGDH UTPADAK SAHAKARI SANGH LTD. V&P: PALSANA, DISTT. SIKAR LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO .: AABAS 0852L VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT JKTLO DH VKSJ LS@ REVENUE BY: SHRI R.A VERMA, ADDL. CIT -DR FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY : SHRI P.C. PARWAL, CA LQUOKBZ DH RKJH[K@ DATE OF HEARING : 09/01/2017 ?KKS'K .KK DH RKJH[K@ DATE OF PRONOUNCEMENT : 11 /01/2017 VKNS'K@ ORDER PER BHAGCHAND, AM THE REVENUE HAS FILED AN APPEAL AGAINST THE ORDER OF THE LD. CIT(A)- III, JAIPUR DATED 23-08-2016 FOR THE ASSESS MENT YEAR 2013-14 RAISING THEREIN FOLLOWING GROUND OF APPEAL. (I). ON THE FACTS AND IN THE CIRCUMSTANCES OF THE C ASE, THE LD. CIT(A) ERRED IN DELETING DISALLOWANCE OF RS. 1,69,68,809/- HOLDING THAT PAYMENT TO MILK SOCI ETIES ON ACCOUNT OF MILK PRICE DIFFERENCE IS NOT LIABLE FOR TDS U/S 194H IGNORING THAT SUCH MILK SOCIETIES PROVIDE SER VICE OF ITA NO. 950/JP/2016 THE ACIT, CIRCLE- SIKAR VS. M/S. SIKAR JHUNJHUNU ZI LA DUGDH UTPADAK SAHAKARI SANGH LTD. . 2 FACILITATING PURCHASE OF MILK BY THE ASSESSEE FROM CATTLE OWNERS AND ARE LIABLE FOR TDS. 2.1 AT THE OUTSET OF HEARING, THE LD. AR OF THE ASS ESSEE RELIED ON RECENT ORDER DATED 14-09-2016 OF THE ITAT, COORDINATE BEN CH, JAIPUR IN ASSESSEE'S OWN CASE IN ITA NO. 33/JP/2016 FOR THE A SSESSMENT YEAR 2012- 13 WHICH HAS BEEN DECIDED AGAINST THE REVENUE. FOR THE SAKE OF CONVENIENCE, THE OBSERVATION OF ITAT JAIPUR BENCH I N THE CASE OF THE ASSESSEE IS AS UNDER:- 2.1 AT THE OUTSET OF THE HEARING, THE LD. AR OF T HE ASSESSEE SUBMITTED THAT THE ISSUES RAISED BY THE REVENUE IN THIS APPEAL ARE COVERED VIDE ORDER DATED 04-03-2016 OF ITAT COORDI NATE BENCH IN ASSESSEE'S OWN CASE (IN ITA NO. 87/JP/2015 FOR T HE ASSESSMENT YEAR 2011-12 AND IN ITA NO. 96/JP/2015 OF REVENUE F OR THE ASSESSMENT YEAR 2011-12). THE LD. AR FURTHER SUBMIT TED THAT THE LD. CIT(A) HAS GRANTED THE RELIEF TO THE ASSESSEE ON TH E BASIS OF DECISION OF THE ITAT COORDINATE BENCH IN ASSESSEE'S OWN CASE FOR THE ASSESSMENT YEAR 2008-09 IN ITA NO. 277/JP/2013 ASSESSEE AND IN ITA NO. 383/JP/2013 REVENUE BY OBSERVING A T PARA 4.3. OF HIS ORDER WHICH IS REPRODUCED AS UNDER:- 4.3 I HAVE CAREFULLY CONSIDERED THE FACTS OF THE CASE AND THE SUBMISSION O THE LD. AR . AO MADE THE DISAL LOWANCE OF RS. 1,77,66,242/- BY HOLDING THAT PAYMENT OF MIL K PRICE PURCHASE DIFFERENCE TO MILK SOCIETIES IS PAYMENT OF COMMISSION AND THEREFORE, ASSESSEE IS LIABLE FOR DE DUCTION OF TAX AT SOURCE U/S 194H WHICH IT FAILED TO DEDUCT. T HE LD. AR ARGUED THAT TOTAL BILL FOR MILK PURCHASE AND MARGIN IS RAISED BY THE SOCIETIES ITSELF AND MILK PRICE PURCHASE DIF FERENCE REPRESENTS MARGIN OF PROFIT. FURTHER, THE SIMILAR D ISALLOWANCE WAS MADE IN A.Y. 2008-09 WHICH HAS BEEN DELETED BY THE HON'BLE ITAT VIDE ITS ORDER DATED 14-07-2015. IT I S SEEN ITA NO. 950/JP/2016 THE ACIT, CIRCLE- SIKAR VS. M/S. SIKAR JHUNJHUNU ZI LA DUGDH UTPADAK SAHAKARI SANGH LTD. . 3 THAT THE HON'BLE ITAT IN ASSESSEE'S OWN CASE FOR A .Y. 2008- 09 WHEREIN SIMILAR DISALLOWANCE WAS MADE, DECIDED T HIS ISSUE IN FAVOUR OF THE ASSESSEE BY HOLDING AS UNDER :- APROPOS PAYMENT OF MILK PRICE DIFFERENCE, THE ASSESSEE SOCIETY DOES NOT PURCHASE MILK FROM CATTLE OWNER AS MISTAKENLY HELD BY LD. AO. SINCE THE LIABI LITY HAS BEEN FASTENED UNDER MISCONCEPTION OF FACTS, WE HOLD THAT THIS PAYMENT ALSO IS NOT LIABLE U/S 194H OF THE ACT. IN VIEW THEREOF, SECOND GROUND OF THE ASSE SSEE WITH REGARD TO DISALLOWANCE U/S 40(A)(IA) STANDS ALLOWED. RESPECTFULLY FOLLOWING THE SAME, THE DISALLOWANCE MADE BY THE AO IS DELETED. 2.2 THE LD. DR RELIED ON THE ORDER OF THE AO. 2.3 WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIALS AVAILABLE ON RECORD. IT EMERGES FROM THE RECORD THAT IN THE CASE OF THE ASSESSEE, RELIEF HAS BEEN GRANTE D BY THE LD. CIT(A) ON THE BASIS OF THE DECISION OF ITAT COORDIN ATE BENCH IN ASSESSEE'S OWN CASE (SUPRA). HENCE, RESPEC TFULLY FOLLOWING THE DECISION OF COORDINATE BENCH IN ASSES SEE'S OWN CASE (SUPRA), WE DISMISS THE APPEAL OF THE REVE NUE. 2.2 IN THIS APPEAL OF THE ASSESSEE, THE LD. CIT(A) DELETED THE DISALLOWANCE MADE BY THE AO U/S 40(A)(IA) OF THE AC T BY OBSERVING AS UNDER:- 4.3 I HAVE CAREFULLY CONSIDERED THE FACTS OF THE CASE AND THE SUBMISSION OF THE LD. AR. AO MADE THE DISAL LOWANCE OF RS. 1,69,68,809/- BY HOLDING THAT PAYMENT OF MIL K PRICE PURCHASE DIFFERENCE TO MILK SOCIETIES IS PAYMENT OF COMMISSION AND THEREFORE, ASSESSEE IS LIABLE FOR DE DUCTION OF ITA NO. 950/JP/2016 THE ACIT, CIRCLE- SIKAR VS. M/S. SIKAR JHUNJHUNU ZI LA DUGDH UTPADAK SAHAKARI SANGH LTD. . 4 TAX AT SOURCE U/S 194H WHICH IT FAILED TO DEDUCT. T HE LD. AR ARGUED THAT TOTAL BILL FOR MILK PURCHASE AND MARGIN IS RAISED BY THE SOCIETIES ITSELF AND MILK PRICE PURCHASE DIF FERENCE REPRESENTS MARGIN OF PROFIT. FURTHER, THE SIMILAR D ISALLOWANCE WAS MADE IN A.Y. 2008-09 WHICH HAS BEEN DELETED BY THE HON'BLE ITAT VIDE ITS ORDER DATED 14-07-2015. IT IS SEEN THAT THE HON'BLE ITAT IN ASSESSEE'S OWN CASE FOR A.Y. 2008-09 WHEREIN SIMILAR DISALLOWANCE WAS MADE, DECIDED THIS ISSUE IN FAVOUR OF THE ASSESSEE BY HOLDING AS UNDER:- APROPOS PAYMENT FOR MILK PRICE DIFFERENCE, THE ASSESSEE SOCIETY DOES NOT PURCHASE MILK FROM CATTLE OWNER AS MISTAKENLY HELD BY LD. AO. SINCE THE LIABI LITY HAS BEEN FASTENED UNDER MISCONCEPTION OF FACTS, WE HOLD THAT THIS PAYMENT ALSO IS NOT LIABLE U/S 194H OF THE ACT. IN VIEW THEREOF, SECOND GROUND OF THE ASSE SSEE WITH REGARD TO DISALLOWANCE U/S 40(A)(IA) STANDS ALLOWED. SIMILARLY, THE HON'BLE ITAT VIDE ORDER DATED 4-03- 2016 FOR A.Y. 2006-07 TO 2010-11 IN PARA NO. 25 HELD THAT AS SESSEE IS NOT LIABLE FOR DEDUCTION OF TDS. I HAVE GONE THROUGH THE ORDER OF THE ITAT AND FACTS OF THE CASE BEFORE ME. THERE WERE NO CHANGE IN THE FACTS O F BOTH THE YEAR. THUS BY RESPECTFULLY FOLLOWING THE ORDER OF ITAT, SINCE THE ASSESSEE IS NOT LIABLE FOR DEDUCTIONS OF TAX AT SOURCE U/S 194H, THE DISALLOWANCE MADE BY THE AO U/S 40(A) (IA) IS DELETED. 2.3 DURING THE COURSE OF HEARING, THE LD. DR RELIED ON THE ORDER OF THE AO. ITA NO. 950/JP/2016 THE ACIT, CIRCLE- SIKAR VS. M/S. SIKAR JHUNJHUNU ZI LA DUGDH UTPADAK SAHAKARI SANGH LTD. . 5 2.4 WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIALS AVAILABLE ON RECORD. IT EMERGES FROM THE RECORDS TH AT IN THE CASE OF THE ASSESSEE, RELIEF HAS BEEN GRANTED BY THE LD. CIT(A) ON THE BASIS OF THE DECISION OF ITAT COORDINATE BENCH IN ASSESSEE'S OWN CASE (SUPRA). HENCE, RESPECTFULLY FOLLOWING THE DECISION OF COORD INATE BENCH IN ASSESSEE'S OWN CASE (SUPRA), WE DISMISS THE APPEAL OF THE REVENUE. 3.0 IN THE RESULT, APPEAL OF THE REVENUE IS DISMISS ED. ORDER PRONOUNCED IN THE OPEN COURT ON 11 /0 1/2017. SD/- SD/- DQY HKKJR HKKXPUN (KUL BHARAT) ( BHAGCHAND) U;KF;D LNL; / JUDICIAL MEMBER YS[KK LNL;@ ACCOUNTANT MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 11 /01/ 2017 *MISHRA VKNS'K DH IZFRFYFI VXZSF'KR@ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ@ THE APPELLANT- THE ACIT, CIRCLE-SIKAR, SIKAR 2. IZR;FKHZ@ THE RESPONDENT- M/S SIKAR & JHUNJHUNU ZILA DUGDH UTPADAK SAHAKARI SANGH LTD. SIKAR 3. VK;DJ VK;QDRVIHY@ CIT(A). 4. VK;DJ VK;QDR@ CIT, 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ@ DR, ITAT, JAIPUR 6. XKMZ QKBZY@ GUARD FILE (ITA NO. 950/JP/2016) VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASSISTANT. REGISTRAR