Balraj Goud Balagouni , Hyderabad V. Asst. Commissioner of Income Tax, Circle-4(1), Hyderabad

MA 47/Hyd/2021

• Counselvise Citation: [2021] 104 COUNSELVISE.COM (IT) 9441 (ITAT-HYDERABAD)
• Duration Of Justice: 1 month(s) 14 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 02-09-2021
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB-A
• Assessment Year: 2013-2014
• Appeal Filed On: 19-07-2021
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Section: 40(a)(ia)

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH “A”, HYDERABAD BEFORE SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER AND SHRI S.S. GODARA, JUDICIAL MEMBER MA No.47/Hyd/2021 (In ITA No. 1601/Hyd/2018) AY: 2013-14 Balraj Goud Balagouni, Hyderabad. PAN: AEYPB 6220 P VS. ACIT, Circle-4(1), Hyderabad. (Appellant) (Respondent) Assessee by: Shri S. Rama Rao Revenue by: Shri A. Venkata Rao, DR Date of hearing: 16/08/2021 Date of pronouncement: 03/09/2021 ORDER PER A. MOHAN ALANKAMONY, AM.: This MA is filed by the assessee seeking rectification of the order passed by the Tribunal in ITA No. 1601/H/2018, dated 22/4/2021. 2. The Ld. AR submitted before us that in the case of the assessee, income from business was estimated at 5% of the aggregate turnover which works out to Rs. 2,52,98,399/- and also addition was made invoking the provisions of 40(a)(ia) of the Act due to non-deduction of Tax at Source towards interest paid for Rs. 17,41,978/- and Rs.84,66,183/-. It was further submitted that when addition is made on estimation basis, further disallowance U/s. 40(a)(ia) is not 2 permissible. Hence, it was pleaded, that the mistake in the Order of the Tribunal for making addition invoking the provisions of section 40(a)(ia) of the Act when the income of the assessee was estimated may be rectified. The Ld. DR on the other hand relied on the order of the Tribunal and argued that there is no mistake in the order of the Tribunal which is required to be rectified. 3. We have heard the rival submission and carefully perused the materials on record. The Tribunal in the earlier occasion had estimated the income of the assessee @ 5% of the assesse’s turnover keeping in view of the nature of the business viz., trading in liquor because the assessee had not properly maintained its books of accounts. Thus, estimation of income was purely based on the nature of commercial activity of the assessee. Further, it is pertinent to mention that provisions of section 40(a)(ia) of the Act is a specific provision for violation of certain provisions of the Act and it has got nothing to do with the income earned by the assessee. The provisions of section 40(a)(ia) are penal in nature which will be attracted for non-deduction of tax at source with respect to the amount paid or payable by the assessee towards expenditure incurred. In the case of the assessee, the assessee has failed to deduct tax at source with respect to the payment made towards interest expenditure. Therefore, the Tribunal had consciously concluded that the Ld. AO has rightly disallowed the amount of Rs. 17,41,978/- and Rs. 84,66,183/- being the interest 3 paid/payable without deducting Tax at Source, invoking the provisions of section 40(a0(ia) of the Act. Hence, there is no mistake in the order of the Tribunal which is required to be rectified. 4. In the result, the MA filed by the assessee is dismissed. Order pronounced in the open court on the 03 rd September, 2021. Sd/- Sd/- (S.S. GODARA) (A. MOHAN ALANKAMONY) JUDICIAL MEMBER ACCOUNTANT MEMBER Hyderabad, Dated: 03 rd September, 2021. OKK Copy to:- 1. Sri Balraj Goud Balagouni, H.No. 3-6-673/1-2, Flat No.302, SMR Residency, Street No.10, Himayatnagar, Hyderabad – 500 029. 2. Asst. Commissioner of Income Tax, Circle-4(1), IT Towers, AC Guards, Hyderabad. 3. The CIT (A)-1, Hyderabad. 4. The Principal Commissioner of Income Tax-1, Hyderabad. 5. The DR, ITAT, Hyderabad. 6. Guard File