Atharva Builders Pune Private ltd.,, Pune v. Income-tax Officer,,

CO 12/PUN/2015 | 2006-2007
Pronouncement Date: 30-04-2015 | Result: Dismissed

Appeal Details

RSA Number 1224523 RSA 2015
Assessee PAN AADCA8304R
Bench Pune
Appeal Number CO 12/PUN/2015
Duration Of Justice 9 day(s)
Appellant Atharva Builders Pune Private ltd.,, Pune
Respondent Income-tax Officer,,
Appeal Type Cross Objection
Pronouncement Date 30-04-2015
Appeal Filed By Assessee
Order Result Dismissed
Bench Allotted B
Tribunal Order Date 30-04-2015
Assessment Year 2006-2007
Appeal Filed On 21-04-2015
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH B PUNE BEFORE: SHRI R.K. PANDA ACCOUNTANT MEMBER AND SHRI VIKAS AWASTHY JUDICIAL MEMBER ITA NO. 966 /PN/201 3 ASSESSMENT YEAR : 20 0 6 - 07 INCOME TAX OFFICER WARD 1(1) PUNE VS. M/S. ATHARVA BUILDERS PUNE PVT. LTD. ATHARVA FERYES PLAZA OPP. SHANKAR MAHARAJ MATH PUNE SATARA ROAD PUNE-411043 (APPELLANT) (RESPONDENT) PAN NO. AADCA8304R CO NO. 12/PN/2015 ASSESSMENT YEAR : 2006 - 07 M/S. ATHARVA BUILDERS PUNE PVT. LTD. ATHARVA FERYES PLAZA OPP. SHANKAR MAHARAJ MATH PUNE SATARA ROAD PUNE-411043 VS. INCOME TAX OFFICER WARD 1(1) PUNE (APPELLANT) (RESPONDENT) PAN NO. AADCA8304R REVENUE BY: SHRI SANTOSH KUMAR ASSESSEE BY: SHRI SUSHANT PADHYE DATE OF HEARING : 28-04-2015 DATE OF PRONOUNCEMENT : 30-04-2015 ORDER PER VIKAS AWASTHY JM:- THE APPEAL HAS BEEN FILED BY THE REVENUE ASSAILING THE ORD ER OF COMMISSIONER OF INCOME TAX (APPEALS)-I PUNE DATED 20-02 -2013 FOR THE ASSESSMENT YEAR 2006-07. THE REVENUE IN ITS APPEAL H AS ASSAILED THE FINDINGS OF COMMISSIONER OF INCOME TAX (APPEALS) IN DELETING THE 2 ITA NO. 966/PN/2013 & CO NO. 12/PN/2015 A.Y. 2006- 07 DISALLOWANCE OF RS.83 36 363/- U/S. 40(A)(IA) OF THE INCOME TAX A CT 1961 (HEREINAFTER REFERRED TO AS THE ACT). THE ASSESS EE HAS FILED CROSS OBJECTION IMPUGNING THE DISALLOWANCE OF RS.4 92 869/- U/S. 40(A )(IA) CONFIRMED BY THE COMMISSIONER OF INCOME TAX (APPEALS). 2. THE BRIEF FACTS OF THE CASE AS EMANATING FROM RECORD S ARE: THE ASSESSEE IS A BUILDER AND DEVELOPER. THE ASSESSEE FILED IT S RETURN OF INCOME FOR THE ASSESSMENT YEAR 2006-07 ON 28-11-2006 DECLARING TOTAL INCOME OF RS.3 12 620/-. THE CASE OF THE ASSESSEE WAS S ELECTED FOR SCRUTINY AND NOTICE U/S. 143(2) WAS ISSUED TO THE ASSESSE E ON 29-09-2007. DURING THE COURSE OF SCRUTINY ASSESSMENT T HE ASSESSING OFFICER OBSERVED THAT ON THE PAYMENTS MADE TO CONTACTO RS AMOUNTING TO RS.83 36 363/- THE ASSESSEE HAD DEDUCTED TAX AT SOURCE (TDS) RS.1 83 400/-. THE SAID TDS WAS DEPOSITED VIDE CHEQUE ON 31-03-2006 HOWEVER THE CHALLAN WAS ISSUED ON 03-04-2006. THE ASSE SSEE HAD MADE ANOTHER PAYMENT OF RS.4 92 869/- TOWARDS ADVERTISING EXPE NSES AND PROFESSIONAL FEES. ON THE SAID PAYMENTS TAX OF RS.7 341/- WAS DEDUC TED AT SOURCE. THE AMOUNT OF TDS WAS DEPOSITED IN THE GOVERNMENT AC COUNT ON 07-11-2006. THE ASSESSING OFFICER HELD THAT THE AFORES AID DEPOSIT OF TDS IS HIT BY THE PROVISIONS OF SECTION 40(A)(IA) THEREFORE T HE AMOUNTS ARE NOT DEDUCTIBLE. THUS THE AMOUNT OF RS.88 29 232/- WAS ADDED BACK IN THE TOTAL INCOME OF THE ASSESSEE. AGGRIEVED BY THE ASSESSMENT ORDER DATED 30-12-2008 T HE ASSESSEE PREFERRED AN APPEAL BEFORE THE COMMISSIONER OF INCOME TAX (APPEALS). THE COMMISSIONER OF INCOME TAX (APPEALS) HELD THAT THE PRO VISIONS OF SECTION 40(A)(IA) ARE NOT APPLICABLE ON THE TDS AMOUNT OF RS.1 83 400/- DEPOSITED ON 31-03-2006. HOWEVER TDS OF RS.7 341/- DED UCTED ON ADVERTISING AND PROFESSIONAL FEES AND PAID TO GOVERNMENT E X-CHEQUER ON 3 ITA NO. 966/PN/2013 & CO NO. 12/PN/2015 A.Y. 2006- 07 07-11-2006 IS NOT ELIGIBLE FOR DEDUCTION. THE COMMISSIONER O F INCOME TAX (APPEALS) WHILE PARTLY ALLOWING THE APPEAL TO THE ASSESS EE CONFIRMED THE DISALLOWANCE OF RS.4 92 869/- U/S. 40(A)(IA). AGAINST THE FINDINGS OF THE COMMISSIONER OF INCOME TAX (APPE ALS) BOTH THE REVENUE AND THE ASSESSEE HAVE COME IN APPEA L BEFORE THE TRIBUNAL. 3. SHRI SANTOSH KUMAR REPRESENTING THE DEPARTMENT VE HEMENTLY SUPPORTED THE ASSESSMENT ORDER AND SUBMITTED THAT TH E ASSESSEE HAD DEPOSITED THE TDS AMOUNT IN THE GOVERNMENT EX-CHEQUER AFTER 31-03-2006. THE ASSESSEE IS HIT BY THE PROVISIONS OF SEC TION 40(A)(IA) AND THEREFORE THE AMOUNT OF RS.83 36 363/- IS NOT DEDUCTIBLE. 4. ON THE OTHER HAND SHRI SUSHANT PADHYE APPEARING ON BEHALF OF TH E ASSESSEE SUPPORTED THE FINDINGS OF THE COMMISSIONER OF IN COME TAX (APPEALS) WITH RESPECT TO RELIEF GRANTED ON THE AMOUNT OF R S.83 36 363/-. THE LEARNED AUTHORIZED REPRESENTATIVE (AR) SUBMITTED THA T TDS DEDUCTED ON RS.83 36 363/- WAS DEPOSITED IN THE BANK ON 31-03-2006 BY CHEQUE. THE CHIEF MANAGER OF STATE BANK OF INDIA ERA NDWANA BRANCH PUNE WHERE THE CHEQUE WAS DEPOSITED HAS SUPPO RTED THE CASE OF THE ASSESSEE. FURTHER THE LD. AR IN ORDER TO FORTIFY H IS SUBMISSIONS PLACED RELIANCE ON THE JUDGMENT OF HON'BLE CALCUTTA HIGH C OURT IN THE CASE OF COMMISSIONER OF INCOME TAX VS. VIRGIN CREATIONS ITA T NO. 302 OF 2011 GA 3200/2011 DECIDED ON 23-11-2011. 5. DEFENDING CROSS OBJECTION THE LD. AR SUBMITTED THAT T HE COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN UPHOLDING THE DISALLOWANCE OF RS.4 92 869/- U/S. 40(A)(IA). THE LD. AR CONTENDE D THAT 4 ITA NO. 966/PN/2013 & CO NO. 12/PN/2015 A.Y. 2006- 07 THERE WAS DELAY IN FILING OF THE CROSS OBJECTION AS THE ASS ESSEE WAS UNDER THE IMPRESSION THAT THE DISALLOWANCE COULD NOT BE R EVERSED AT THE APPELLATE STAGE. THE ASSESSEE WAS ALSO NOT AWARE OF THE DECISION OF THE CO-ORDINATE BENCH OF THE TRIBUNAL IN THE CASE OF ACIT AHM EDNAGAR CIRCLE VS. KUKADI SAHAKARI SAKHAR KARKHANA LTD. IN ITA NO. 1529/PN/2013. IN THE SAID CASE THE ASSESSEE HAD D EPOSITED TDS ON 31-05-2007 IN RESPECT OF ASSESSMENT YEAR 2007-08. THE TRIBUNAL ALLOWED THE APPEAL OF THE ASSESSEE BY FOLLOWING THE DECISION RENDERED IN THE CASE OF ACIT VS. M/S. MULAY BROTHERS LTD. ITA NO. 13 75/PN/2013 DECIDED ON 20-08-2014. THE FACTS AND CIRCUMSTANCES OF T HE ASSESSEES CASE ARE SIMILAR TO THE ONE ADJUDICATED BY THE TRIBUNAL IN THE AFORESAID APPEALS. THE LEARNED DEPARTMENTAL REPRESENTATIVE (DR) VEHEMENTLY OPPOSED THE APPLICATION FOR CONDONATION OF DELAY IN FILING OF TH E CROSS OBJECTION BEYOND THE PERIOD OF LIMITATION. THE LD. DR SUBMIT TED THAT THERE HAS BEEN DELAY OF 352 DAYS IN FILING OF THE CROSS OBJ ECTION AND THE DELAY HAS NOT BEEN EXPLAINED BY THE ASSESSEE. THE ASSE SSEE CANNOT CLAIM THE RELIEF MERELY ON THE GROUND THAT THE ASSESSEE WAS NOT AWARE OF THE DECISION ON THE SIMILAR ISSUE SUBSEQUENTLY PASSED BY THE TRIBUNAL. IN SUPPORT OF HIS SUBMISSIONS THE LD. DR PLACED RELIANCE O N THE DECISION OF THE JUDGMENT OF HON'BLE BOMBAY HIGH COURT IN THE CAS E OF SOMERSET PLACE CO-OPERATIVE HOUSING SOCIETY LTD. VS. INCOME TAX OFFIC ER IN ITA (LODG) NO. 874 OF 2014 DECIDED ON 13-02-2015. 6. WE HAVE HEARD THE SUBMISSIONS MADE BY THE REPRESEN TATIVES OF BOTH THE SIDES AND HAVE PERUSED THE ORDERS OF THE AUT HORITIES BELOW. WE HAVE ALSO EXAMINED THE DECISIONS ON WHICH RELIANCE HAS BEE N PLACED BY BOTH THE SIDES. WE WILL FIRST TAKE UP THE APPEAL OF THE RE VENUE. IT IS AN 5 ITA NO. 966/PN/2013 & CO NO. 12/PN/2015 A.Y. 2006- 07 UNDISPUTED FACT THAT THE ASSESSEE HAS DEPOSITED TDS TO THE TUNE OF RS.1 83 400/- ON PAYMENTS OF RS.83 36 363/- TO THE CONTRAC TORS MUCH BEFORE THE DUE DATE OF FILING OF RETURN AS SPECIFIED U/S. 139( 1) OF THE ACT. AS PER THE CONTENTIONS OF THE ASSESSEE THE SAID AMOUNT WAS DEPOSITED IN THE BANK BY CHEQUE ON 31-03-2006. HOWEVER THE CHALLAN WAS GENERATED ON 03-04-2006. THE MANAGER OF THE BANK WHERE CHEQUE WAS DEPOSITED HAS VOUCHED THE STATEMENT OF ASSESSEE. THE COMMISSIONE R OF INCOME TAX (APPEALS) IN HIS ORDER HAS OBSERVED THAT THE FACTS HA VE BEEN VERIFIED FROM THE RECORDS AND ARE SEEN TO BE CORRECT. 7. THE HON'BLE HIGH COURT OF GUJARAT IN THE CASE OF KANG OLD (INDIA) LTD. VS. CIT REPORTED AS 239 ITR 842 HAS DEALT WITH A S IMILAR ISSUE WHERE THE CHEQUE WAS DEPOSITED ON 30-03-1998 AND THE CHALLAN WAS GENERATED ON 03-04-1998. THE HONBLE COURT HELD THAT THE PAYMENT OF AMOUNT SHALL BE DEEMED TO HAVE BEEN MADE ON THE DATE OF DELIVERY OF THE CHEQUE AND NOT THE DATE OF ENCASHMENT OF CHEQUE. 8. FURTHER A PERUSAL OF THE PROVISIONS OF SECTION 40(A)(IA) MA KES IT ABUNDANTLY CLEAR THAT THE TAX DEDUCTIBLE AT SOURCE UN DER CHAPTER XVII- B HAS TO BE PAID IN GOVERNMENT ACCOUNT ON OR BEFORE T HE DUE DATE SPECIFIED IN SUB-SECTION (1) OF SECTION 139. THUS NO DISALLOW ANCE U/S. 40(A)(IA) COULD BE MADE WHERE THE TDS HAS BEEN PAID BEFORE THE DUE DATE OF FILING OF RETURN OF INCOME. THE AFORESAID PROVISIONS WERE AM ENDED BY THE FINANCE ACT 2010. THE HONBLE CALCUTTA HIGH COURT IN THE CASE OF COMMISSIONER OF INCOME TAX (APPEALS) VS. VIRGIN CREATIONS (SU PRA) HELD THAT THE AMENDMENT TO SECTION 40(A)(IA) IS RETROSPECTIVE IN NATURE . IN THE FACTS OF THE CASE AND THE DECISIONS OF THE HONBLE HIGH COURTS DISCUSSED ABOVE WE DO NOT FIND ANY INFIRMITY IN THE IMPUGNED 6 ITA NO. 966/PN/2013 & CO NO. 12/PN/2015 A.Y. 2006- 07 ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS). ACCORD INGLY THE FINDINGS OF THE COMMISSIONER OF INCOME TAX (APPEALS) ON THIS ISSUE ARE CONFIRMED AND THE APPEAL OF THE REVENUE IS DISMISSED BEING DEVOID OF MERIT. CO NO. 12/PN/2015 9. THE CROSS OBJECTION FILLED BY THE ASSES IS TIME BARRED BY 352 DAYS. THE ASSESSEE HAS FILED APPLICATION FOR CONDONATION OF DELAY. THE REASONS GIVEN BY THE ASSESSEE FOR DELAY IN FILING OF THE CROSS OBJECTION ARE: - THE ASSESSEE WAS UNDER IMPRESSION THAT THE DISALLOWANC E COULD NOT BE REVERSED AT THE APPELLATE LEVEL; AND - THE ASSESSEE WAS UNAWARE OF THE ORDER OF THE CO-ORD INATE BENCH OF THE TRIBUNAL IN THE CASE OF ACIT AHMEDNAGAR CIRCLE VS. KUKADI S AHAKARI SAKHAR KARKHANA LTD. (SUPRA). EXCEPT FOR ABOVE TWO REASONS NO OTHER REASON HAS BEE N GIVEN BY THE ASSESSEE FOR THE DELAY IN FILING OF THE CROSS OBJECTION. 10. WE ARE WELL AWARE OF THE JUDICIAL PRINCIPLE THAT THE CON DONATION OF DELAY IS A RULE AND DENIAL AN EXCEPTION. HOWEVER THE PART Y TO THE LIS FILING APPEAL HAS TO REASONABLY EXPLAIN THE REASONS CAUSING DELAY IN FILING OF THE APPEAL. THE ASSESSEE CANNOT COME OUT OF THE SLUM BER AT HIS OWN CONVENIENCE AND FILE APPEAL MUCH AFTER THE EXPIRY OF LIMITATION PERIOD. THE ASSESSEE CANNOT CLAIM THE CONDONATION OF DELAY AS A MATTER OF RIGHT. THE REASONS RESULTING IN DELAY OF FILING APPEAL HAS TO BE EXPLAINED. IN THE PRESENT CASE THERE IS INORDINATE DELAY OF 352 DAYS. THE ASSESSEE HAS NOT GIVEN ANY REASON WORTH CONSIDERING FOR CONDONING SUCH HUGE DE LAY IN FILING OF THE APPEAL. IGNORANCE OF LAW IS NO EXCUSE SPECIALLY WHEN THE ASSESSEE IS A JURISTIC PERSON AND HAS THE ADVANTAGE OF GETTING LEGA L ADVICE 7 ITA NO. 966/PN/2013 & CO NO. 12/PN/2015 A.Y. 2006- 07 FROM THE PROFESSIONALS. IT WOULD BE RELEVANT TO MENTION HE RE THAT THE IMPUGNED ORDER WAS PASSED ON 20-02-2013 THE DECISION O N WHICH THE ASSESSEE HAS PLACED RELIANCE FOR CLAIMING RELIEF IN CROSS OBJE CTION WAS PASSED BY THE CO-ORDINATE BENCH OF THE TRIBUNAL ON 25-0 8-2014 I.E. ALMOST AFTER THE ELAPSE OF ONE YEAR OF LIMITATION FOR FILING OF THE APPEAL. IN OUR CONSIDERED VIEW IGNORANCE OF SUBSEQUENT ORDER PA SSED BY THE TRIBUNAL CANNOT BE A VALID GROUND FOR CONDONING DELAY IN FILING OF CROSS OBJECTION. THE HONBLE BOMBAY HIGH COURT IN THE CASE OF SOMERSET PLACE CO-OPERATIVE HOUSING SOCIETY LTD. VS. INCOME TAX OF FICER (SUPRA) WHILE DEALING WITH THE SIMILAR SITUATION HAS OBSERVED AS UNDER: 7. WE ARE OF THE OPINION THAT THE REASONS AS SHOWN BY THE APPLICANT CANNOT FALL WITHIN THE PARAMETERS OF SUFFIC IENT CAUSE SO AS TO CONFER A BENEFIT OF CONDONATION TO THE APPLICANT . THIS IS FOR THE REASON THAT THE APPLICANT HAD TAKEN A WELL CONSIDERED DECISION NOT TO MOVE FURTHER PROCEEDINGS AGAINST THE ORDER DATED 31.10.2008. APPLYING THE TEST OF A PRUDENT LITIGANT IT CANNOT BE H ELD THAT ONCE THE APPLICANT BY HIS OWN VOLITION HAD DECIDED TO ACCEPT A JUDICIAL ORDER THE APPLICANT CAN AT ANY TIME ASSAIL THE SAME MAY BE FOR THE REASON THAT SUBSEQUENTLY NEW DECISIONS ARE RENDERED ON THA T ISSUE. SECTION 5 OF THE LIMITATION ACT CANNOT BE STRETCHED TO BRING ABOUT A SITUATION OF UNSETTLING JUDICIAL DECISIONS WHICH STOOD ACCEPTED BY THE PARTIES. IF THE CONTENTION OF THE APPLICANT IS ACCEPTED IT W OULD CREATE A SITUATION OF CHAOS AND UNSETTLING VARIOUS ORDERS PA SSED FROM TIME TO TIME BY THE TRIBUNAL AS ACCEPTED BY THE PARTIES. THE LE GISLATIVE MANDATE IN STIPULATING A LIMITATION TO FILE AN APPEAL W ITHIN THE PRESCRIBED LIMITATION CANNOT BE PERMITTED TO BE DEFEAT ED WHEN A LITIGANT HAS TAKEN A DECISION NOT TO PURSUE FURTHER PROCEEDINGS. A NEW RULING IS NO GROUND FOR REVIEWING A PREVIOUS JU DGMENT. IF THIS IS PERMITTED THE INEVITABLE CONSEQUENCE IS CONFUSION CHA OS UNCERTAINTY AND INCONVENIENCE AS THEN NO ORDERS CAN EVER ATTAIN FINALITY THOUGH ACCEPTED BY PARTIES. 11. IN VIEW OF THE FACTS OF THE CASE AND THE JUDGMENT OF THE HONBLE JURISDICTIONAL HIGH COURT WE DO NOT FIND ANY REASON TO CON DONE 8 ITA NO. 966/PN/2013 & CO NO. 12/PN/2015 A.Y. 2006- 07 INORDINATE DELAY OF 352 DAYS IN FILING OF THE CROSS OBJECTION . ACCORDINGLY THE SAME IS DISMISSED BEING BARRED BY LIMITATION. 12. IN THE RESULT THE APPEAL OF THE REVENUE AND THE CRO SS OBJECTION OF THE ASSESSEE ARE DISMISSED. ORDER PRONOUNCED ON THURSDAY THE 30 TH DAY OF APRIL 2015 AT PUNE SD/- SD/- (R.K. PANDA) (VIKAS AWASTHY) ACCOUNTANT MEMBER JUDICIAL MEMBER PUNE DATED: 30 TH APRIL 2015 RK/PS COPY TO 1 ASSESSEE 2 DEPARTMENT 3 THE CIT(A) - I PUNE 4 THE CIT - I PUNE 5 6 THE DR ITAT B BENCH PUNE. GUARD FILE. //TRUE COPY// BY ORDER ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL PUNE