ITO, Bangalore V. M/s Sand Communications Pvt. Ltd., Bangalore

MA 39/BANG/2011

• Counselvise Citation: [2012] 123 COUNSELVISE.COM (IT) 9658 (ITAT-BANGALORE)
• Duration Of Justice: 1 year(s) 6 month(s) 19 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 21-12-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 07-12-2012
• Assessment Year: misc
• Appeal Filed On: 02-06-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S K AMBASTHA CITIDR
• Assessee Lawyers: H N KHINCHA
• Keywords: Non-deduction of tax
• Section: 194C; 201(1)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH : BANGALORE BEFORE SMT. P. MADHAVI DEVI, JUDICIAL MEMBER AND SHRI JASON P. BOAZ, ACCOUNTANT MEMBER M.P. NO.39/BANG/2011 (IN ITA NO.806 & 807/BANG/2010) ASSESSMENT YEAR : 2006-07 & 2007-08 THE INCOME TAX OFFICER, WARD 12(2), BANGALORE. VS. M/S. SANDS ADVERTISING COMMUNICATIONS PVT. LTD., 29, NAJAPPA ROAD, K.H. ROAD (OPP. RBI), NRUPATHANGA ROAD, BANGALORE 560 027. PAN: AACCS 9684H APPLICANT RESPONDENT APPLICANT BY : SHRI S.K. AMBASTHA, CIT-I(DR) RESPONDENT BY : SHRI H.N. KHINCHA, C.A. DATE OF HEARING : 14.12.2012 DATE OF PRONOUNCEMENT : 21.12.2012 O R D E R PER SMT. P. MADHAVI DEVI, JUDICIAL MEMBER THIS MISCELLANEOUS PETITION IS FILED BY THE REVE NUE U/S. 254(2) OF THE INCOME-TAX ACT, 1961 (HEREINAFTER REFERRED TO AS T HE ACT), SEEKING RECTIFICATION OF THE ORDER OF THE TRIBUNAL DATED 28 .12.2010. 2. IN THIS APPLICATION, THE GRIEVANCE OF THE REVENU E IS THAT THE TRIBUNAL HAS ADJUDICATED THE MATTER WITHOUT APPRECIATING THE MERITS OF THE CASE AND IGNORING THE GROUNDS RAISED BY THE DEPARTMENT. IT IS SUBMITTED THAT THE TRIBUNAL HAS OMITTED TO CONSIDER THE MAIN GROUND RA ISED BY THE DEPARTMENT M.P. NO.39/BANG/2011 PAGE 2 OF 4 WITH REGARD TO SUSTAINING THE ADDITION TO THE EXTEN T OF 3% OF TOTAL ADVERTISEMENT CHARGES PAID BY THE ASSESSEE TO ITS S ISTER CONCERN, M/S. TRISHUL COMMUNICATIONS WITHOUT EFFECTING TDS U/S. 1 94C AGAINST TOTAL COMMISSION OF 15% RECEIVED FROM PRINT MEDIA IN THE ORDINARY COURSE OF ASSESSEES BUSINESS. IT IS SUBMITTED THAT THE TRIB UNAL HAS MERELY FOLLOWED THE ORDER IN THE ASSESSEES OWN CASE FOR THE A.YS. 2005-06 TO 2007-08, WHICH IS IN CONNECTION WITH DISPOSAL OF TDS APPEAL AND THEREFORE PRIMA FACIE, THERE IS A MISTAKE IN THE ORDER OF THE TRIBUNAL WIT H REGARD TO ITS FAILURE TO ADJUDICATE THE SPECIFIC GROUND OF THE DEPARTMENT , WHICH IS WITH REGARD TO DISALLOWANCE ON ACCOUNT OF SECTION 40(A)(IA) OF THE ACT. IT IS THEREFORE PRAYED BY THE REVENUE TO RECTIFY THE ORDER OF THE T RIBUNAL U/S. 254 OF THE ACT. 3. THE LD. DR REITERATED THE SUBMISSIONS MADE IN TH E RECTIFICATION APPLICATION, WHILE THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT ALL THE ISSUES RAISED IN THE PRESENT APPEAL ARE ALSO CONSID ERED BY THE TRIBUNAL IN THE APPEAL NOS. 790 TO 795/BANG/2009 IN THE ASSESSE ES OWN CASE FOR THE A.YS. 2005-06 TO 2007-08 AND THEREFORE THERE IS NO MISTAKE APPARENT FROM THE RECORD WHICH NEEDS RECTIFICATION. 4. HAVING HEARD BOTH THE PARTIES AND HAVING CONSIDE RED THE RIVAL CONTENTIONS, WE FIND THAT FOR THE ASSESSMENT YEARS 2005-06 TO 2007-08, THE ASSESSEE HAD COME IN APPEAL BEFORE THE TRIBUNAL AGA INST THE ORDERS U/S. 201(1) AND 201(1A) OF THE ACT FOR NON-DEDUCTION OF TAX AT SOURCE. THE TRIBUNAL AFTER CONSIDERING THE ISSUE AT LENGTH, HAS HELD THAT THE PAYMENTS MADE BY THE ASSESSEE TO ITS SISTER CONCERN, M/S. TR ISHUL COMMUNICATIONS, M.P. NO.39/BANG/2011 PAGE 3 OF 4 DOES NOT FALL WITHIN THE AMBIT OF SECTION 194C OF T HE ACT AND THEREFORE THE REVENUE WAS NOT JUSTIFIED IN INVOKING THE PROVISION S OF SECTION 201(1) & 201(1A) OF THE ACT. 5. IN THE APPEAL BEFORE US, THE DISALLOWANCE WAS MA DE BY THE AO U/S. 40(A)(IA) OF THE ACT FOR NON-DEDUCTION OF TAX AT SO URCE. THEREFORE, THE ISSUE OF NON-DEDUCTION OF TAX AT SOURCE ON THE AMOUNTS PA ID TO M/S. TRISHUL COMMUNICATIONS WAS THE CORE ISSUE IN THE ASSESSEES OWN CASE FOR THE A.YS. 2005-06 TO 2007-08 AND IN THE PRESENT APPEAL. AS IT HAS ALREADY BEEN HELD BY THE TRIBUNAL THAT THE PROVISIONS OF SE CTION 194C ARE NOT APPLICABLE TO THE ASSESSEES CASE, THEN THE ASSESSE E IS NOT LIABLE TO MAKE TDS FROM THE PAYMENTS TO TRISHUL COMMUNICATIONS AND THIS TRIBUNAL IN THE ASSESSEES APPEAL HAS FOLLOWED THE ORDER OF THE COO RDINATE BENCH IN UPHOLDING THE ORDER OF THE CIT(APPEALS). THEREFORE , WE SEE NO MISTAKE IN THE ORDER OF THE TRIBUNAL WHICH NEEDS RECTIFICATION . 6. IN THE RESULT, THE REVENUES MISCELLANEOUS PETIT ION IS ACCORDINGLY DISMISSED. PRONOUNCED IN THE OPEN COURT ON THIS 21 ST DAY OF DECEMBER 2012. SD/- SD/- ( JASON P. BOAZ ) ( P. MADHAVI DEVI ) ACCOUNTANT MEMBER JUDICIAL MEMBER BANGALORE, DATED, THE 21 ST DECEMBER , 2012. DS/- M.P. NO.39/BANG/2011 PAGE 4 OF 4 COPY TO: 1. APPLICANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR, ITAT, BANGALORE. 6. GUARD FILE BY ORDER SENIOR PRIVATE SECRETARY ITAT, BANGALORE.