Hindustan Cables Ltd.,, Hyderabad v. ACIT, Hyderabad

ITA 1016/HYD/2008 | 2001-2002
Pronouncement Date: 16-07-2010 | Result: Partly Allowed

Appeal Details

RSA Number 101622514 RSA 2008
Bench Hyderabad
Appeal Number ITA 1016/HYD/2008
Duration Of Justice 2 year(s) 1 month(s) 16 day(s)
Appellant Hindustan Cables Ltd.,, Hyderabad
Respondent ACIT, Hyderabad
Appeal Type Income Tax Appeal
Pronouncement Date 16-07-2010
Appeal Filed By Assessee
Order Result Partly Allowed
Bench Allotted B
Tribunal Order Date 16-07-2010
Assessment Year 2001-2002
Appeal Filed On 30-05-2008
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH B HYDERABAD BEFORE SHRI G.C. GUPTA VICE PRESIDENT AND SHRI CHANDRA POOJARI ACCOUNTANT MEMBER ITA NOS.1016 TO 1021/HYD/2008 AY :2001-02 2002-03 2003-04 2004-05 2005-06 & 2 006-07 M/S HINDUSTAN CABLES LIMITED HYDERABAD VS THE ACIT CIRCLE 15(1) TDS HYDERABAD (APPELLANT) (RESPONDENT) APPELLANT BY: SHRI S. RAMA RAO RESPONDENT BY: SHRI AMLAN TRIPATHY O R D E R PER CHANDRA POOJARI ACCOUNTANT MEMBER THESE SIX APPEALS PREFERRED BY THE ASSESSEE ARE DIRECTED AGAINST THE COMMON ORDER PASSED BY THE CIT(A) II HYDERABAD DA TED 12.3.2008 AND PERTAINS TO THE ASSESSMENT YEARS 2001-02 2002-03 2003-04 2004-05 2005-06 & 2006-07. SINCE CERTAIN C OMMON ISSUES ARE INVOLVED IN THESE APPEALS THEY ARE CLUBBED TOGETH ER HEARD TOGETHER AND DISPOSED OFF VIDE THIS COMMON ORDER FOR THE SAKE OF CONVENIENCE. 2. THE ASSESSEE RAISED THE FOLLOWING COMMON GROUNDS: 1. THE CIT(A) ERRED IN CONFIRMING THE ACTION OF THE AS SESSING OFFICER IN TREATING THE ASSESSEE AS AN ASSESSEE IN DEFAULT TO THE EXTENT OF RS.61 66 406/-. 2. THE CIT(A) ERRED IN HOLDING THAT INTEREST U/S 201(1 A)IS CHARGEABLE AND ALSO ERRED IN DIRECTING THE ASSESSING OFFICER TO RE WORK OUT THE INTEREST U/S 201(IA) OF THE IT ACT. ITA NO.S1016 TO 1021/H/2008 M/S HINDUSTAN CABLES HYDERABAD 3. BRIEF FACTS OF THE CASE ARE THAT A SURVEY U/S 133A WAS CONDUCTED IN THE CASE OF THE ASSESSEE ON 23.10.2006. DURIN G THE SURVEY IT WAS NOTICED THAT THE ASSESSEE COMPANY HAD NOT BE EN REMITTING THE TAX DEDUCTED AT SOURCE U/S 192 WITHIN THE TIME PRESCRIBED IN THE ACT. AS PER THE ORDER OF THE ASSESSING OFFICER TH E FOLLOWING AMOUNT OF TAX DEDUCTED HAD NOT BEEN REMITTED TO THE GOVT. A/C AS UNDER: AS ON 31.3.2000 RS.19 19 751 AS ON 31.3.2001 RS.61 66 406 AS ON 31.3.2002 RS.67 98 246 AS ON 31.3.2003 RS.52 29 267 AS ON 31.3.2004 RS.55 41 817 AS ON 31.3.2005 RS.51 44 122 AS ON 31.3.2006 RS.29 31 570 3.1. WHEN ASKED TO EXPLAIN THE REASON FOR NON REMIT TANCE THE ASSESSEE HAD GIVEN THE REASON OF HUGE CASH LOSSES INCURRED BY THE COMPANY OVER THE LAST 10 YEARS. THE ASSESSEE ALSO STATED TH AT DUE TO NON PAYMENT OF ADVANCE AGAINST SUPPLY ORDER BY BSNL & MTNL THE PRODUCTION OF THE HYDERABAD UNIT HAD TO BE SUSPENDED EF FECTIVE FROM 2.4.2003 AND ALL THE OPERATIONS OF THE UNIT HAD COME TO A STANDSTILL. THE ASSESSEE ALSO STATED THAT THE COMPANY HAD BEEN REFERRED TO BIFR AS A SICK COMPANY AND REGISTERED AS CASE NO.505/2002. FURTHER IT WAS STATED THAT INSPITE OF FINANCIAL DIFFICULTY IT HAS ALRE ADY BEEN PAID TAX OF RS.27.68 LAKHS. HOWEVER THE EXPLANATION GIVEN BY THE ASSESSEE WAS NOT ACCEPTED BY THE ASSESSING OFFICER. THE ASSESSING OFFICER O BSERVED THAT THE OUTSTANDING TDS AMOUNTS ARE NOTHING BUT TAX DEDUCTED FROM THE ARREARS OF SALARY/WAGES. THE DEDUCTOR COMPANY CANNO T HAVE ANY ITA NO.S1016 TO 1021/H/2008 M/S HINDUSTAN CABLES HYDERABAD EXCUSE IN HOLDING BACK THE AMOUNT DEDUCTED FROM THE SALA RIES OF THE EMPLOYEES AND APPLY THE SAME IN SOME OTHER PURPOSE. T HE TDS IS MADE FROM THE ARREARS ACTUALLY DISBURSED AND AS SUCH THE F INANCIAL POSITION OF THE COMPANY HAS NOTHING TO DO WITH THE NON REMITTANCE. THE ASSESSING OFFICER ALSO OBSERVED THAT THE ASSESSEE HAS STATED TH AT IT HAD REMITTED AN AMOUNT OF RS.27.68 LAKHS. THE ASSESSING OFFI CER ALSO OBSERVED THAT THE REMITTANCE IS WITH REGARD TDS MADE D URING THE FINANCIAL YEAR 1997-98 WHEN ARREARS WERE PAID TO TH E EMPLOYEES. THEREFORE THE COMPANY CANNOT TAKE CREDIT FOR THIS DEDU CTION FOR THE YEAR MENTIONED ABOVE. THE ASSESSING OFFICER FURTHER OBSE RVED THAT AS ON 31.3.2006 THE ASSESSEE HAS SHOWN AN OUTSTANDING LIABILI TY OF RS.29 31 570/- WHEREAS AS PER COMPUTATION SHEET ENCLOSED TO THE ORDER THE SAME COMES TO RS.56 60 911/-. ACCORDINGLY THE ASSESSING OFFICER TREATED THE ASSESSEE AS AN ASSESSEE IN DEFAULT IN RESPECT OF T AX AMOUNTING TO RS.56 60 911/- U/S 201(1). CONSEQUENTLY INTEREST U/S 201(1A) AMOUNTING TO RS.42 86 887/- WAS ALSO LEVIED. ON APPEAL CIT(A) IN PRINCIPLE AGREED WITH THE FINDINGS OF TH E ASSESSING OFFICER. HOWEVER HE SET ASIDE THE ISSUE TO THE FILE OF ASSESSING OF FICER TO DECIDE THE QUANTUM OF DEMAND U/S 201 AND 201(1A) AFTER VERI FYING THE COPY OF THE LEDGER ACCOUNT SUBMITTED BY THE ASSESSEE DURING THE AP PELLATE PROCEEDINGS AND COMPARE THE SAME WITH THE DETAILS FURNISH ED EARLIER AND RE-COMPUTE THE DEMAND U/S 201 AND 201(1A) IN TERMS OF AN AMOUNT OF RS.27.68 LAKHS WHICH HAS ALREADY PAID OUT OF TDS AMOUNT OF TS.52 18 471/- FOR WHICH A SEPARATE DEMAND U/S 201 HAD BEEN RAISED IN THE ASSESSMENT YEAR 1997-98. HE ORDERED THAT CONSEQUENT DE MAND FOR OTHER FINANCIAL YEARS 2001-02 TO 2005-06 TO BE RAISE D. AGAINST THIS THE ASSESSEE IS IN APPEAL BEFORE US. ITA NO.S1016 TO 1021/H/2008 M/S HINDUSTAN CABLES HYDERABAD 4. THE AUTHORISED REPRESENTATIVE SUBMITTED BEFORE U S THAT THE AMOUNT OF RS.52.18 LAKHS WAS SUBJECT TO THE ORDER BY THE ASSESSING OFFICER FOR THE ASSESSMENT YEAR 1997-98 AND THAT THEREFO RE IT WOULD BE DOUBLE TAXATION OF THE SAME AMOUNT IF THE SAID AMOUN T IS CONSIDERED FOR THE ASSESSMENT YEARS 2001-02 TO 2006-07. HENCE HE PR AYED TO PASS A SEPARATE ORDER U/S 201(1) AND 201(1A) OF THE IT ACT FOR EACH ASSESSMENT YEARS FROM 2001-02 TO 2006-2007 AND COMPUTE TH E DEMAND OF EACH ASSESSMENT YEAR AFTER CHARGING INTEREST U/S 201 AN D 201(1A). OTHER THAN THIS HE SUBMITTED THAT HE HAS NO GRIEVANCE . 5. THE DEPARTMENTAL REPRESENTATIVE SUBMITTED THAT AN APPROPRIATE DIRECTION MAY BE GIVEN TO THE ASSESSING OFFI CER TO PASS INDEPENDENT ORDER FOR EACH ASSESSMENT YEARS. 6. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE MATERIAL AVAILABLE ON RECORD. AS SEEN FROM THE ARGUMENT OF THE ASSESSEES COUNSEL THERE IS NO DISPUTE THAT THE ASSESSEE IS IN DEFAUL T U/S 201 AND 201(1A). HOWEVER THE PLEA OF THE ASSESSEES COUNSEL B EFORE US IS THAT ORDER U/S 201 AND 201(1A) IS REQUIRED TO BE PASSED FOR EACH ASSESSMENT YEAR. WE ARE IN AGREEMENT WITH THE ARGUMENT OF THE ASSESSEES COUNSEL TO THIS EXTENT. ACCORDINGLY WE DIRECT THE ASSESSING OFFI CER TO PASS ORDER U/S 201 AND 201(1A) FOR EACH ASSESSMENT YEAR DISTINCTLY AND ONCE THE AMOUNT IS CONSIDERED AS DEFAULT IN ONE ASSESSMENT YEAR BY ASSESSING OFFICER THE SAME AMOUNT CANNOT BE CONSIDERED AS DEFAULT IN SUBSEQUENT ASSESSMENT CUMULATIVELY U/S 201 AND 201 (1A). BECAUSE THE ORDER U/S 201 AND 201(1A) TO BE PASSED FOR EACH ASSESSMENT YEAR AND IT CANNOT BE PASSED COLLECTIVELY FOR ALL ASSESSMENT YEAR IN A CONSOLID ATED MANNER WHICH IS NOT THE REQUIREMENT OF THIS SECTION AND ALSO C HARGING INTEREST ON THE SAME AMOUNT OF DEFAULT AT MULTIPLE TIMES IS NO T PROVIDED IN THE ITA NO.S1016 TO 1021/H/2008 M/S HINDUSTAN CABLES HYDERABAD SECTION. AS SUCH WE DIRECT THE ASSESSING OFFICER TO PASS O RDER U/S 201 AND 201(1A) FOR EACH ASSESSMENT YEAR AND COMPUTE THE INTE REST UNDER THIS PROVISION FROM THE DATE ON WHICH SUCH TAX WERE DE DUCTIBLE TO THE DATE ON WHICH SUCH TAX IS ACTUALLY PAID. 7. IN THE RESULT THE APPEALS OF THE ASSESSEE ARE PART LY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT 16.7.2010 SD/- SD/- G.C. GUPTA CHANDRA POOJARI VICE PRESIDENT ACCOUNTANT MEMBER DATED THE 16 TH JULY 2010 COPY FORWARDED TO: 1. M/S HINDUSTAN CABLES LTD. HYDERABAD C/O SHRI S. RAMA RAO ADVOCATE FLAT NO.103 H.NO.3-6 - 542/4 INDIRADEVI NILAYAM ST. NO.7 HIMAYAT NAGAR HYDERABAD 2. THE ACIT CIRCLE 15(1) TDS HYDERABAD 3. CIT(A)-II HYDERABAD. 4. CIT HYDERABAD 5. THE D.R. ITAT HYDERABAD. NP