Sh. Chandresh Jain Prop. M/s Prabhat Thread (India) , Ludhiana V. ITO, Ward 2(1), Ludhiana

MA 13/CHANDI/2023

AI Insights

The case involves Shri Chandresh Jain, the proprietor of M/s Prabhat Thread (India), who filed a Miscellaneous Application against the order of the CIT(A) confirming an addition of Rs.3,61,954 under section 143(1) of the Income Tax Act, 1961. The addition was initially rectified by CPC, Bangalore under section 154, but the CIT(A) later enhanced this addition, leading to the appeal. The assessee argued that the CIT(A) exceeded his jurisdiction and that the TDS was deposited within the extended time due to COVID-19, which should have precluded the disallowance. The Tribunal noted the confusion and inadvertent error by the assessee's counsel in the earlier proceedings and decided to recall the previous order, allowing a fresh hearing.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 135469 (ITAT-CHANDIGARH)
• Duration Of Justice: 2 month(s) 15 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 11-09-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 10-09-2023
• Assessment Year: 2020-2021
• Appeal Filed On: 27-06-2023
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Bonafide mistake; TDS
• Section: 154; 143(1)

Judgement Text

आयकर अपीलीय अिधकरण,च᭛डीगढ़ ᭠यायपीठ “ए” , च᭛डीगढ़ IN THE INCOME TAX APPELLATE TRIBUNAL, CHANDIGARH BENCH “A”, CHANDIGARH ᮰ी आकाश दीप जैन, उपा᭟यᭃ एवं ᮰ी िवᮓम ᳲसह यादव, लेखा सद᭭य BEFORE: SHRI. AAKASH DEEP JAIN, VP & SHRI. VIKRAM SINGH YADAV, AM Miscellaneous Application No. 13/Chd/2023 In आयकर अपील सं./ ITA NO. 699/Chd/2022 िनधाᭅरण वषᭅ / Assessment Year : 2020-21 Shri Chandresh Jain, Prop. M/s Prabhat Thread (India), Gali No. 3, Mahavir Colony, G.T. Road, Sunder Nagar, Ludhiana बनाम The ITO Ward 2(1), Ludhiana ̾थायी लेखा सं./PAN NO: ABDPJ7395R अपीलाथᱮ/Appellant ᮧ᭜यथᱮ/Respondent िनधाᭅᳯरती कᳱ ओर से/Assessee by : Shri Sudhir Sehgal, Advocate राज᭭व कᳱ ओर से/ Revenue by : Smt. Amanpreet Kaur, Sr. DR सुनवाई कᳱ तारीख/Date of Hearing : 11/09/2023 उदघोषणा कᳱ तारीख/Date of Pronouncement : 12/09/2023 आदेश/Order PER VIKRAM SINGH YADAV, A.M. : The present miscellaneous application has been filed by the Assessee against the order passed by the Coordinate Bench dt. 10/04/2023 in ITA No. 699/Chd/2022 for Assessment Year 2020-21. 2. In the Miscellaneous Application, it has been submitted as under: MISCELLANEOUS PETITION IN INCOME TAX APPEAL NO.699/CHD/2022 FOR ASSESSMENT YEAR 2020-2021 IN THE CASE OF SH. CHANDRESH JAIN PROP. M/S PRABHAT THREAD (INDIA), GALI NO.3, MAHAVIR COLONY, G.T. ROADY, SUNDER NAGAR, LUDHANA 141008, PUNJAB, LUDHIANA; 1. That in the above said case, the appellant had filed an appeal before the Hon'ble Bench and following grounds of appeals were taken up:- "1. That the Ld. CIT( Appeals) NFAC, Delhi has erred in confirming addition amounting to Rs.3,61,954/- u/s 143(1) of the Income Tax Act, 1961 on account of the following iterns:- i) TDS payable on Interest Rs.3,47,764.00 ii) TDS payable on contract Rs.5,790.00 iii) TDS payable on professional Rs. 8,400.00 2 1. That the Ld. CIT (Appeals) NFAC, Delhi has failed to appreciate that the said additions, though, were disallowed u/s 143(1) by CPC, Bangalore but the same order was rectified u/s 154 vide order, dated 12.04.2022 during the course of pendency of appeal with the Ld. CIT(A), NFAC, Delhi and the said addition of Rs. 3,61,9541- as per ground No. 1 were allowed, while passing the order u/s 154 and, thus, the CIT (A) has exceeded his jurisdiction by making disallowance of Rs. 3,61,9541- as per ground No.1 above. 2. Notwithstanding, the above said ground of appeal, the CIT (A) has even otherwise failed to appreciate that the said amount shown as payable to the tune of Rs. 3,61,9541- was credited in the books of accounts on 31 st of March 2020 and, as such, the prescribed time as per the 'Act' to pay the said amount was 30 th of April 2020 and since the TDS was deposited within the extended time due to the COVID-19 and, therefore, no such disallowance was otherwise called for. 3. That the appellant carves leave to add, amend, alter any of the above grounds during the appellate proceedings have been considered." 2. That the facts are that certain adjustments were made by the CPC, Bangalore, vide order, dated 28.10.2021 and these adjustments related to as under for which, the addition was made by the CPD, Bangalore: - i) TDS payable on Interest Rs. 3,47,764.00 ii) TDS payable on contract Rs. 5,790.00 iii) TDS payable on professional Rs. 8,400.00 3. That the assessee filed an appeal before the Ld. CIT(A), NFAC,Delhi against the order as passed by the CPC, Bangalore and simultaneously, moved an application u/s 154 to CPC, Bangalore and the CPC, Bangalore vide order u/s 154, dated 12.04.2022, the necessary relief was allowed to the assessee as per copy of the order u/s 154 already there in the appeal filed by the assessee before your honours. 4. That before the Ld. CIT(A), the reference was to the order u/s 154, dated 12.04.2022 by the ADIT, CPC, Bangalore and the Ld. CIT (A) held that the said order as passed u/s 154 is not correct and enhanced the addition as per page 9 and 10 of the order with the following remarks:- "Further, it is hereby held that relief allowed in the order u/s 154 of the Income Tax Act, passed on 12.04.2022, by the ADIT, CPC, Bangalore is not correct in respect of (i) TDS payable on interest Rs. 3,47,764.00 (ii) TDS payable on contract: Rs. 5790.00 (iii) TDS payable on professional: Rs. 8400.00 For the reasons stated above, relief allowed to the extent of Rs. 3,61,954/- in the order u/s 154 of the Income Tax Act, passed on 12.04.2022 by the ADIT, CPC, Bangalore is hereby ENHANCED. 3 In other words, out of the total disallowance of Rs. 6,62,151/-made in the order u/s 143(1), dated 28.10.2021, for the reasons stated above ( in paragraph 5.5), Rs. 3,61,954/- is CONFIRMED and Rs. 3,00,197/- is deleted." 5. That the assessee filed an appeal before your honour taking the specific ground that since the CPC, Bangalore had already rectified the order u/s 154 both on law and on facts, the CIT (A) appears to have exceeded his jurisdiction by making the disallowance and also on law, it was stated by way of ground No. 3 since the TDS was deposited within extended time due to COVID-19 and as such, no disallowance was called for. 6. That at the time of hearing, the counsel of the assessee argued that in view of the fact that since the order as passed by the CPC, Bangalore has since been rectified u/s 154 and necessary benefit has already been allowed and sought to withdraw the appeal. 7. That the counsel inadvertently missed out that the Ld.CIT(A) has already considered the order passed u/s 154 passed on 12.04.2022 and held that the said order was not correct and the addition was enhanced. 8. That this was on account of some confusion on the part of the assessee's counsel and it is only now when the department has not given necessary effect to the order u/s 154 and it has come to the knowledge of the assessee that due to the bonafide mistake on the part of the assessee's counsel, appeal has been sought to be withdrawn and the same is evident from the order as passed by the Hon'ble ITAT in para 4 as under:- "4. In view of the order passed u/s 154 of the Act, dated 12.04.2022, the appeal of the assessee is dismissed as withdrawn." 9. That the order as passed by the CIT (A) was after the order u/s 154 i.e. order u/s 154 was passed on 12.04.2022 and the CIT(A) had passed the order on 23.10.2022. 10. That even otherwise, legally, the case of the assessee is fully covered by the extension of limitation on account of COVID-19 and also all the payments were made before the due date of filing the return and all the facts are to be borne out from the file of the Hon'ble Bench and no further facts are looked into and, therefore, it is prayed that the order as passed in ITA No.699/Chd/2022 vide order, dated 10.04.23 may, please, be recalled on account of mistake on the part of the counsel due to inadvertent error and fresh hearing be afforded to the assessee. 3. Ld. DR is heard who has relied on the order passed by the Coordinate Bench. 4. After hearing both the parties and considering the material available on the records including the Affidavit filed by the Ld. Counsel for the Assessee, the order so passed by the Coordinate Bench is hereby recalled and the matter is fixed for hearing 4 on merit on 17/10/2023. Since pronouncement in the open Court, separate notice is dispensed with. 5. In the result, Miscellaneous Application is allowed in light of aforesaid directions. Order pronounced in the open Court on 12/09/2023. Sd/- Sd/- आकाश दीप जैन िवᮓम ᳲसह यादव (AAKASH DEEP JAIN) ( VIKRAM SINGH YADAV) उपा᭟यᭃ / VICE PRESIDENT लेखा सद᭭य/ ACCOUNTANT MEMBER AG Date: 12/09/2023 आदेश कᳱ ᮧितिलिप अᮕेिषत/ Copy of the order forwarded to : 1. अपीलाथᱮ/ The Appellant / 2. ᮧ᭜यथᱮ/ The Respondent 3. आयकर आयुᲦ/ CIT 4. आयकर आयुᲦ (अपील)/ The CIT(A) 5. िवभागीय ᮧितिनिध, आयकर अपीलीय आिधकरण, च᭛डीगढ़/ DR, ITAT, CHANDIGARH 6. गाडᭅ फाईल/ Guard File आदेशानुसार/ By order, सहायक पंजीकार/ Assistant Registrar