ITO, TDS, PALAKKAD, PALAKKAD V. DISTRICT LOTTERY OFFICER PALAKKAD, PALAKKAD

ITA 315/COCH/2025

AI Insights

The case involves appeals by the Revenue against the common order of the CIT(A) which had granted relief to the assessee, the District Lottery Officer, Palakkad. The Revenue challenged the CIT(A)'s decision on the grounds that the appeal was allowed without proper examination of the factual matrix and legal provisions, specifically concerning the compliance with Section 194B of the Income-tax Act, 1961, which relates to TDS on winnings from lotteries or games. The Tribunal agreed with the Revenue's contention that the CIT(A) failed to verify the identity and genuineness of the prize winners and whether the threshold for TDS under Section 194B was crossed in each transaction.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 633140 (ITAT-COCHIN)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-06-2025
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB
• Assessment Year: 2015-2016
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: LEENA LAL SNR.
• Keywords: Opportunity of being heard; TDS
• Section: 201(1)

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL COCHIN BENCH BEFORE SHRI INTURI RAMA RAO, AM AND SHRI SONJOY SARMA, JM ITA Nos. 314 & 315/Coch/2025 Assessment Years: 2014-15 & 2015-16 ITO , TDS, Palakkad .......... Appellant Aayakar Bhawan, English Church Road, Palakkad - 678014 vs. District Lottery Officer ,Palakkad .......... Respondent Appellant by: Shri. None Respondent by: Smt. Leena Lal Snr. AR. Date of Hearing: 05 .06.2025 Date of Pronouncement: 13.06.2025 O R D E R Per: Sonjoy Sarma JM These appeals are filed by the Revenue against the common order of the CIT(A) dated 05.03.2025, wherein relief was granted to the assessee. First, we take ITA No.314/Coch/2025 for narration of facts. 2. ITA No.314/Coch/2025 - In this case, the Income Tax Department, based on information in its possession, found that the deductor (assessee) had failed to comply with the provisions of Section 194B of the Income-tax Act, 1961 (relating to TDS on 2 ITA No. 314 & 315/Coch/2025 ITO TDS, Palakkad winnings from lotteries or games). As a result, the Assessing Officer finalized proceedings under Sections 201(1) and 201(1A) of the Act on 08.05.2020, treating the assessee as an assessee-in-default and raising a demand of Rs.2,32,65,540/-. 4. Aggrieved by the said order, the assessee preferred appeals before the CIT(A). The CIT(A) allowed relief to the assessee. However, the Revenue has challenged this order on the ground that the CIT(A) allowed the appeal without properly examining the factual matrix and legal provisions. 6. Dissatisfied with the above order, the revenue is in appeal before up. Specifically, it is the contention of the Revenue that the CIT(A) failed to verify whether the winners of the prize money were identifiable and genuine, and whether the threshold prescribed under Section 194B was indeed crossed in each transaction. The Revenue further submitted that the CIT(A) erred in allowing the appeal without considering that each transaction of prize distribution, if exceeding the threshold, attracts TDS liability under Chapter XVII of the Act. 7. We, after hearing the ld. DR and perusal of the material available on record, find that at the time of passing of the impugned order, the ld. CIT(A) did not examine the issue of the identity and genuineness of the prize winners. The CIT(A) had not sufficiently examined whether the provisions of Section 194B were attracted on 3 ITA No. 314 & 315/Coch/2025 ITO TDS, Palakkad a transaction-wise basis. Therefore, a proper factual verification is required to be examined. In light of the above, we find that the matter should be remanded back to the file of the CIT(A) for fresh adjudication after proper verification of facts and affording a reasonable opportunity of being heard to the assessee. Hence, ITA No. 314/Coch/2025 is allowed for statistical purposes. 9. ITA No.315/Coch/2025 - As the facts and issues are identical to those in ITA No.314/Coch/2025, our decision in that appeal shall apply mutatis mutandis to this appeal also. Accordingly ITA No. 315/Coch/2025 is also allowed for statistical purposes. 10. In the result, both the captioned appeals of the revenue are allowed statistical purposes. Order pronounced in the open court on 13.06.2025. Sd/- Sd/- (INTURI RAMA RAO) ACCOUNTANT MEMBER (SANJOY SARMA) JUDICIAL MEMBER Cochin, Dated: 13.06.2025 Copy to: 1. The Appellant 2. The Respondent 3. The Pr. CIT concerned 4. The Sr. DR, ITAT, Cochin 5. Guard File Assistant Registrar ITAT, Cochi "