LOTS SHIPPING LIMITED,KOCHI V. JCIT TDS , KOCHI

ITA 607/COCH/2023

AI Insights

The case involves Lots Shipping Ltd., which appealed against the penalties imposed by the Joint Commissioner of Income Tax (TDS) for delayed remittance of TDS amounts during the financial years 2009-10 and 2010-11. The penalties were initially contested at the National Faceless Appeal Centre, which upheld the penalties citing the company's repeated defaults and lack of reasonable cause. The Tribunal, after reviewing the submissions and the company's history of defaults, agreed with the lower authorities and dismissed the appeals, confirming the penalties.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 31361 (ITAT-COCHIN)
• Duration Of Justice: 1 year(s) 2 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-10-2024
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2010-2011
• Appeal Filed On: 21-08-2023
• Other Referred Cases: CIT Vs. United Insurance Company. Ltd.(321 ITR 1), Union of India Vs. Dharmendra Textile Processors (306 ITR 277), M/s U.S. Technologies International Pvt.Ltd. dated: 16.06.2009
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: V.SWARNALATHA
• Keywords: Reasonable cause; TDS
• Section: 250

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL COCHIN BENCH, COCHIN Before Shri Satbeer Singh Godara, Judicial Member and Shri Amarjit Singh, Judicial Member ITA Nos. 607 & 608/Coch/2023 (Assessment Years: 2010-11 & 2011-12) Lots Shipping Ltd. OS#34th Floor GCDA Complex, Kochi 682031 [PAN: AAACL4062A] vs. Jt. Commissioner of Income Tax (TDS) CR Building, IS Press Road Kochi 682018 (Appellant) (Respondent) Appellant by: ------- None ------- Respondent by: Smt. V. Swarnalatha, Sr. D.R. Date of Hearing: 19.08.2024 Date of Pronouncement: 23.10.2024 O R D E R Per Bench These assessee’s twin appeals arise against orders of the National Faceless Appeal Centre , Delhi [CIT(A)] in proceedings u/s. 250 of the Income Tax Act, 1961 (the Act) as under : - Sr. No. ITA No. AY DIN & Order No. Date 1 607/Coch/2023 2010-11 ITBA/NFAC/S/250/2023- 24/1053815696(1) 20.06.2023 2 812/Coch/2023 2007-07 ITBA/NFAC/S/250/2023- 24/1053820732(1) 20.06.2023 Cases called twice. None appears at assessee’s behest. We accordingly proceed exparte against the assessee. 2 ITA Nos. 607 & 608/Coch/2023 Lots Shipping Ltd. 2. Coming to the assessee’s identical sole substantive ground challenging section 271C penalties herein of Rs.8,39, 515/- and Rs.8,84,392/-; assessment year-wise, respectively, learned Sr. DR invited our attention to the CIT(A)/NFAC’s lower appellate detailed discussion upholding the same as under: - “5. DECISION: I have very carefully considered the facts of the case, grounds of appeal, Penalty order passed by the JCIT (TDS) and the submissions of the assessee. 5.1 The assessee company is a deductor of TDS, During the the F.Y.2009-10, the assessee company had deposited the TDS made belatedly into the Government Account. Therefore, the JCIT(TDS) issued da ar notice u/s.274 r.w.s 271C of the Act on 20.12.2012 posting the case for hearing on 15.01.2013. On the date of hearing, the assessee filed reply to the aforesaid notice mainly pleading that the bills raised were not realized in time, the assessee changed accountants frequently and there was no intention to remit the TDS amount late. The reply of the assessee did not find favour with the AO. The AO was of the view that the assessee had committed similar default in earlier years starting from the F.Y.2008-09 to subsequent years including the F.Y.2012-13 when the amount of TDS had not been remitted even uptill 31.05.2013. The AO has also stated that the Penalty for F.Y.2008-09 was dropped considering the fact that it was the first year of default. The AO has relied on the Karnataka High Court decision in the case of CIT Vs. United Insurance Company. Ltd.(321 ITR 1) and the Union of India Vs. Dharmendra Textile Processors (306 ITR 277). The AO has further observed that the assessee has not been able to make out any case for reasonable cause u/s.273B of the Act. The AO has further relied on the Kerala High Court decision in the case of M/s U.S. Technologies International Pvt.Ltd. dated: 16.06.2009 while upholding the penalty order u/s 271C of the Act. The AO also observed that by not depositing the TDS amount in time into the Government Account, the assessee is unjustly depriving the deductees from getting credit for the tax deducted at source which warrants the levy of penalty u/s271C of the Act. The amount of TDS not remitted into the Government account during the year was Rs.8,39,515/- and therefore, after being satisfied, the AO levied the penalty of Rs.8,39,515/-u/s.271C of the Act for the F.Y.2009-10. 5.2 On the other hand it is the contention of the appellant as reproduced above. A perusal thereof reveals that the assessee has mainly pleaded that the bills raised were not realized in time, the assessee changed accountants frequently and there was no intention to remit the TDS amount late. I find that the assessee has not been able to explain the reasons for belated deposit and no case for reasonable cause has been made out either during the penalty proceedings before the JCIT or during the appellate proceedings. Therefore, I do not see any reason to interfere with a well reasoned and speaking order of the AO. Thus, the penalty of Rs.8,39,515/- levied u/s.271C of the Act for the F.Y.2010-11 by the AO is confirmed. Hence, the grounds of appeal are Dismissed.” 3. Suffice to say, the CIT(A) has adopted the very discussion in the latter assessment year 2011-12 as well. We note in this factual backdrop that the assessee 3 ITA Nos. 607 & 608/Coch/2023 Lots Shipping Ltd. could not even plead and prove any reasonable cause within the meaning of section 273B of the Act explaining the delay in compliance of TDS provisions in question. Learned Sr. D.R. has further taken us to the CIT(A)’s detailed discussion in para 5.1 that this assessee has indeed be a habitual defaulter right from F.Y. 2008-09 onwards as well (supra). 4. Faced with this situation, we do not see any reason to interfere with the learned lower authorities findings levying the impugned section 271C penalty in both these assessment years. Ordered accordingly. 5. These assessee’s twin appeals ITA.Nos.607 & 608/Coch/2023 are dismissed in above terms. A copy of this common order be placed in the respective case files. Order pronounced in the open court on 23rd October, 2024. Sd/- Sd/- (Amarjit Singh) Accountant Member (Satbeer Singh Godara) Judicial Member Cochin, Dated: 23rd October, 2024 n.p. Copy to: 1. The Appellant 2. The Respondent 3. The Pr. CIT concerned 4. The Sr. DR, ITAT, Cochin 5. Guard File By Order Assistant Registrar ITAT, Cochin "