M/s Shreeji Shipping, JAMNAGAR V. The Deputy Commissioner of Income Tax, TDS Circle, RAJKOT-GUJARAT

ITA 971/RJT/2010

• Counselvise Citation: [2010] 135 COUNSELVISE.COM (IT) 3020 (ITAT-RAJKOT)
• Duration Of Justice: 5 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-11-2010
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 01-11-2011
• Assessment Year: 2009-2010
• Appeal Filed On: 04-06-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AVINASH KUMAR
• Assessee Lawyers: MJ RANPURA
• Keywords: Rectification of order; TDS
• Section: 194C; 201(1); 154

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL RAJKOT BENCH, RAJKOT BEFORE SHRI T.K. SHARMA (JM) AND SHRI A.L. GEHLOT ( AM) I.T.A. NO.971/RJT/2010 (ASSESSMENT YEAR 2009-10) M/S SHREEJI SHIPPING VS THE ACIT, TDS CIRCLE NEAR TOWN HALL RAJKOT JAMNAGAR PAN : AAIFS8023K TAN : RKTSO2399F (APPELLANT) (RESPONDENT) DATE OF HEARING : 02-11-2011 DATE OF PRONOUNCEMENT : 04-11-2011 APPELLANT BY : SHRI MJ RANPURA RESPONDENT BY: SHRI AVINASH KUMAR O R D E R PER T.K. SHARMA (JM) THIS APPEAL BY THE ASSESSEE IS AGAINST THE ORDER D ATED 31-03-2010 PASSED BY THE CIT(A), RAJKOT FOR THE ASSESSMENT YEA R 2009-10. 2. THE FACTS IN BRIEF RELATING TO THE CONTROVERSY I NVOLVED IN THIS APPEAL ARE THAT FOR THE ASSESSMENT YEAR UNDER APPEAL THE DCIT, TDS CIRCLE, RAJKOT VIDE ORDER DATED 12-03-2009 U/S 201(1) R.W.S. 194-I RAISED DEM AND OF SHORT DEDUCTION OF RS.40,71,948. THIS PAYMENT WAS CREATED ON THE GROU ND THAT THE ASSESSEE WAS REQUIRED TO DEDUCT TDS U/S 194-I @11.33% AND NOT U/ S 194C @2.266%. ON APPEAL, THE LD.CIT(A) VIDE ORDER DATED 29-01-2010 U PHELD THE ACTION OF THE ASSESSING OFFICER. SUBSEQUENTLY THE LD.CIT(A) PASS ED ORDER U/S 154 DATED 31-03- 2010 WHEREIN HE REWORKED THE SHORT DEDUCTION AT RS. 79,26,768 AS AGAINST SHORT ITA NO.971/RJT/2010 2 DEDUCTION WORKED OUT BY THE DY.CIT, TDS CIRCLE, RAJ KOT IN HIS ORDER DATED 12-03- 2009 AT RS.40,71,948. AGGRIEVED BY THIS ORDER OF L D.CIT(A) DATED 31-03-2010 PASSED U/S 154 OF THE ACT, THE ASSESSEE IS IN APPEA L BEFORE THE TRIBUNAL ON THE FOLLOWING EFFECTIVE GROUNDS: 2.0 THE LEARNED COMMISSIONER OF INCOME TAX (APPEA LS)-II, RAJKOT [HEREINAFTER REFERRED TO AS THE CIT(A)] ERRE D ON FACTS AS ALSO IN INVOKING THE PROVISIONS OF SECTION 154 O F THE INCOME-TAX ACT, 1961 (HEREINAFTER REFERRED TO AS TH E ACT) AND THEREBY PASSING THE RECTIFICATION ORDER. THE O RDER PASSED U/S 154 OF THE ACT MAY KINDLY BE QUASHED. 3.0 THE LEARNED CIT(A) ERRED ON FACTS AS ALSO IN LA W IN NOT ACCEPTING THE SUBMISSION / RECONCILIATION FURNISHED BY THE APPELLANT AND THEREBY ENHANCING THE ALLEGED AMOUNT OF SHORT DEDUCTION OF TAX AT RS.38,54,520/- OVER AND ABOVE T HAT WORKED OUT BY THE AO. THE ORDER PASSED U/S 154 IS TOTALLY UNJUSTIFIED MAY KINDLY BE CANCELLED. 3. AT THE TIME OF HEARING ON BEHALF OF THE ASSESSEE SHRI MJ RANPURA APPEARED AND POINTED OUT THAT AGAINST THE ORDER DAT ED 29-01-2010 PASSED BY THE CIT-II, RAJKOT CONFIRMING THE SHORT DEDUCTION OF RS . 40,71,.948 AN APPEAL WAS PREFERRED BEFORE THE ITAT, RAJKOT BENCH. THE RELEV ANT APPEAL NUMBER IS ITA NO.762/RJT/2010. THE RAJKOT BENCH OF THE TRIBUNAL VIDE ORDER DATED 10-08- 2010 DECIDED THAT APPEAL WHEREIN IT WAS HELD THAT T HE ASSESSEE WAS REQUIRED TO DEDUCT TAX U/S 194C AND NOT U/S 194-I OF THE ACT. RELYING ON THIS JUDGMENT OF THE TRIBUNAL, THE LD.AR OF THE ASSESSEE POINTED OUT THA T THE IMPUGNED ORDER OF THE LD.CIT(A) DATED 31-03-2010 PASSED U/S 154 BE QUASHE D. 4. SHRI AVINASH KUMAR, THE LD.DR APPEARING FOR THE REVENUE COULD NOT CONTROVERT THE AFORESAID SUBMISSIONS OF THE LD.AR O F THE ASSESSEE. ITA NO.971/RJT/2010 3 5. WE HAVE CAREFULLY GONE THROUGH THE ORDER OF AUTH ORITIES BELOW. IT IS PERTINENT TO NOTE THAT THE ITAT, RAJKOT BENCH IN IT A NO.762/RJT/2010 ORDER DATED 10-08-2010 HAS ALREADY TAKEN THE VIEW THAT TH E ASSESSEE WAS REQUIRED TO DEDUCT TAX AT SOURCE U/S 194C ONLY AND NOT U/S 194- I OF THE ACT AND CONSEQUENTLY THERE WAS NO SHORT DEDUCTION OF TAX AT SOURCE. IN THE CIRCUMSTANCES, THE IMPUGNED RECTIFICATION ORDER DATED 29-01-2010 PASSE D BY THE CIT(A) WHEREBY HE HAS ENHANCED THE SHORT DEDUCTION OF TAX AT RS. 79,2 6,768 U/S 194-I HAS NO LEG TO STAND. WE THEREFORE, QUASH THE RECTIFICATION ORDER DATED 31-03-2010 PASSED BY THE CIT(A). 6. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 04-11-2011. SD/- SD/- (A.L. GEHLOT) (T.K. SHARMA) ACCOUNTANT MEMBER JUDICIAL MEMBER RAJKOT, DT : 04 TH NOVEMBER, 2011 PK/- COPY TO: 1. ASSESSEE 2. REVENUE 3. THE CIT(A)-II, RAJKOT 4. THE CIT-I, RAJKOT 5. THE DR, I.T.A.T., RAJKOT (TRUE COPY) BY ORDER ASSTT.REGISTRAR, ITAT, RAJKOT