Madhucon Projects Ltd., Hyd, Hyderabad V. DCIT, Circle-14(2), Hyd, Hyderabad

ITA 958/HYD/2015

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 6265 (ITAT-HYDERABAD)
• Duration Of Justice: 1 year(s) 1 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-08-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 16-08-2016
• Assessment Year: 2010-2011
• Appeal Filed On: 17-07-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: PALLAVI AGARWAL
• Assessee Lawyers: P MURALI MOHAN RAO
• Keywords: Opportunity of being heard; Additional evidence
• Section: 201(1)

Judgement Text

ITA NO 958 OF 2015 MADHUCON PROJECTS LTD HYDERABAD PAGE 1 OF 4 IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD A BENCH, HYDERABAD BEFORE SMT. P.MADHAVI DEVI, JUDICIAL MEMBER & SHRI B. RAMAKOTAIAH, ACCOUNTANT MEMBER ITA NO.958/HYD/2015 (ASSESSMENT YEAR: 2010-11) M/S. MADHUCON PROJECTS LIMITED HYDERABAD TAN:HYDM 01534 B VS. DY. COMMISSIONER OF INCOME TAX, CIRCLE 14 (2) (TDS) HYDERABAD (APPELLANT) (RESPONDENT) FOR ASSESSEE : SHRI P. MURALI MOHAN RAO FOR REVENUE : SMT. PALLAVI AGARWAL, DR DATE OF HEA R ING : 16.08.2016 DA TE OF PRONOUNCEMENT : 24 .08.2016 O R D E R PER SMT. P. MADHAVI DEVI, J.M. THIS IS ASSESSEES APPEAL FOR THE A.Y 2010-11 AGAIN ST THE PROCEEDINGS U/S 201(1) AND 201(1A) OF THE I.T. ACT. 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE IS A COMPANY WHICH IS ENGAGED IN THE BUSINESS OF CONSTRUCTION OF ROADS, DAMS AND OTHER PROJECTS. ON THE BASIS OF THE INFORMATION FURNISHED BY THE DGM (TAXATION) OF THE COMPANY, THE AO NOTICED V ARIOUS DEFECTS IN THE TDS RETURNS FILED BY THE ASSESSEE. H E OBSERVED THAT THE ASSESSEE HAS MADE HUGE ADVANCES TO THE CONTRACTORS/PROFESSIONALS. THE ASSESSEE WAS ASKED T O FURNISH THE DETAILS OF LOANS AND ADVANCES ON WHICH TDS WAS NOT DEDUCTED. AS PER THE LIST FURNISHED BY THE ASSESSEE , THE AO FOUND THAT ADVANCES OF RS. 374,48,38,139 WERE MADE WITHOU T ANY TDS. ITA NO 958 OF 2015 MADHUCON PROJECTS LTD HYDERABAD PAGE 2 OF 4 HE OBSERVED THAT SINCE THE NATURE OF THE ADVANCES I S NOT REFLECTED IN THE BOOKS, THE LIABILITY OF THE ASSESSEE TO MAKE TDS ARISES IRRESPECTIVE OF THE FACT WHETHER THEY HAVE BEEN PAI D OR NOT. HE ARRIVED AT THE LIABILITY U/S 201(1) @ 2.26% AT RS.7 ,48,96,762 AND INTEREST PAYABLE THEREON U/S 201(1A) AT RS.3,48,26, 994/- TOTALLING TO RS.11,53,06,707. AGGRIEVED, THE ASSESS EE FILED AN APPEAL BEFORE THE CIT (A) AND FILED THE REQUISITE D ETAILS ALONGWITH THE RELEVANT DOCUMENTS. THE CIT (A) CALLED FOR A RE MAND REPORT FROM THE AO. AO HOWEVER, OBJECTED TO THE ADMISSION OF THE ADDITIONAL EVIDENCE ON THE GROUND THAT THE ASSESSEE FAILED TO PRODUCE THE PROOF OF TDS COMPLIANCE INSPITE OF OPPO RTUNITIES GRANTED TO THE ASSESSEE. WITHOUT PREJUDICE TO THE A BOVE OBJECTION, AO ALSO SUBMITTED A DETAILED REMAND REPO RT ON THE MERITS OF THE TDS DEMAND RAISED. HE OBSERVED THAT T HE LOANS AND ADVANCES OF RS. 374,48,38,139 APPEARING IN THE BALA NCE SHEET AS ON 31.03.2010 INCLUDES OPENING BALANCE OF ADVANC E OF RS.3,22,51,23,815 WHICH WAS CARRIED FORWARD FROM EA RLIER YEAR. WITH REFERENCE TO THE BALANCE AMOUNT OF RS.51,97,14 ,264 HE CONSIDERED THE BREAK UP OF THE SAME UNDER VARIOUS H EADS AND ACCEPTED ALL THE ITEMS EXCEPT FOR THE SUM OF RS.15, 36,48,222 WHICH REPRESENTS THE ADVANCES GIVEN TO VARIOUS SUB- CONTRACTORS AND AS PER THE ADDITIONAL EVIDENCE SUBMITTED BY THE ASSESSEE, PARTY-WISE DETAILS OF THE ADVANCE IS FURNISHED BY T HE ASSESSEE WITH A REMARK THAT TDS IS RECOVERED FROM THE PARTY , BUT THAT THE ASSESSEE HAS NOT FURNISHED ANY PROOF OF RECOVER Y AND REMITTACE OF THE TDS ON THIS ADVANCES TO THE SUB-CO NTRACTORS AT THE TIME OF PAYMENT OR CREDIT WHICHEVER IS EARLIER. SINCE THE ASSESSEE FAILED TO PRODUCE THE RELEVANT CERTIFICATE IN FORM 16A WITH REGARD TO THIS AMOUNT, THE CIT (A) OBSERVED TH AT THE AO, DURING THE REMAND PROCEEDINGS, AFTER EXAMINING THE ISSUE IN ITA NO 958 OF 2015 MADHUCON PROJECTS LTD HYDERABAD PAGE 3 OF 4 DETAIL, HAS SPECIFICALLY POINTED OUT THAT ON VERIFI CATION OF FORM 16A AND LEDGER A/C VIS--VIS THE PARTY-WISE DETAILS GIVEN IN ADDITIONAL EVIDENCE,THE AMOUNTS (I) DID NOT MATCH ( II) ASSESSEE FAILED TO RECONCILE THE ADVANCES WITH THE TDS AMOUN TS (III) THE ASSESSEE DID NOT PRODUCE ANY CONCLUSIVE EVIDENCE OF HAVING DEDUCTED AND REMITTED THE TDS AMOUNT. IN VIEW OF TH E SAME, THE CIT (A) CONFIRMED THE LIABILITY OF TDS ON THE ADVAN CES OF RS.15,36,48,222 AND CONFIRMED THE DEMAND RAISED U/S 201(1) AND 201(1)A FOR SUCH AN AMOUNT. FOR SIMILAR REASONS , CIT (A) UPHELD THE TDS LIABILITY U/S 201(1) AND INTEREST U/ S 201(1A) ON ADVANCES FOR WORK MATERIAL OF RS.1,21,73,753. AGGRI EVED, THE ASSESSEE IS IN APPEAL BEFORE US. 3. AT THE TIME OF HEARING, THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE ASSESSEE HAS NOW FILED THE RECON CILATION OF THE DIFFERENCES IN THE DETAILS GIVEN BY THE ASSESSEE ON ALL THE ISSUES CONFIRMED BY THE CIT(A), IN ADDITION TO THE ABOVE I SSUES AND PRAYED THAT ALL THE ISSUES MAY BE REMITTED TO THE F ILE OF THE AO FOR VERIFICATION. THE LEARNED DR, ON THE OTHER HAND, SU PPORTED THE ORDERS OF THE AUTHORITIES BELOW. 4. HAVING REGARD TO THE RIVAL CONTENTIONS, WE FIND THAT THE ASSESSEES CLAIM IS THAT THE ASSESSEE HAS DEDUCTED THE TAX AT SOURCE AND HAS FILED THE RELEVANT DOCUMENTS BEFORE THE CIT (A) WHICH HAS BEEN REMANDED TO THE AO FOR VERIFICATION. HE SUBMITTED THAT THE REQUISITE DETAILS WERE FILED BEF ORE THE AO, BUT AS THE ASSESSEE COULD NOT RECONCILE THE DIFFERENCES IN THE SAID FORMS, THE CIT (A) HAS CONFIRMED THE LIABILITY OF T HE ASSESSEE U/S 201(1) AND INTEREST U/S 201(1A) OF THE ACT. AS PER THE MATERIAL ON RECORD, WE FIND THAT THE DISPUTE IS NOT WITH REGARD TO NON ITA NO 958 OF 2015 MADHUCON PROJECTS LTD HYDERABAD PAGE 4 OF 4 DEDUCTION OF TAX AT SOURCE, BUT IS WITH REGARD TO T HE RECONCILIATION OF THE FORM 16A, WITH THE AMOUNTS CL AIMED TO HAVE BEEN DEDUCTED BY THE ASSESSEE. SINCE THE ASSESSEE H AS FILED ALL THE RELEVANT DETAILS BEFORE US AND SUBMITTED THAT H E WILL BE ABLE TO RECONCILE THE DIFFERENCES, WE DEEM IT FIT AND PR OPER TO REMAND THIS APPEAL TO THE FILE OF THE AO FOR VERIFICATION OF THE DETAILS GIVEN BY THE ASSESSEE TO RECONCILE THE DIFFERENCES AND TO DECIDE THE SAME IN ACCORDANCE WITH LAW. THE AO SHALL GIVE THE ASSESSEE A FAIR OPPORTUNITY OF BEING HEARD DURING THE REMAND P ROCEEDINGS. THIS APPEAL IS ACCORDINGLY TREATED AS ALLOWED FOR S TATISTICAL PURPOSES. 5. IN THE RESULT, APPEAL FILED BY THE ASSESSEE IS T REATED AS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 24 TH AUGUST, 2016. S D/ - S D/ - (B.RAMAKOTAIAH) (P. MADHAVI DEVI) ACCOUNTANT MEMBER JUDICIAL MEMBER HYDERABAD, DATED 24 TH AUGUST, 2016. VNODAN/SPS COPY TO: 1. P.MURALI & CO. CAS, 6-3-655/2/3, IST FLOOR, SOMAJIG UDA, HYDERABAD 500082 2. DY. COMMISSIONER OF INCOME TAX, CIRCLE 14(2)(TDS) HYDERABAD 3. CIT(A) -8 HYDERABAD 4. CIT (TDS) HYDERABAD 5. THE DR, ITAT, HYDERABAD 6. GUARD FILE BY ORDER