DSM Multimedia,, Panchkula v. ITO, (TDS), Panchkula

ITA 916/CHANDI/2010 | 2003-2004
Pronouncement Date: 31-01-2011 | Result: Allowed

Appeal Details

RSA Number 91621514 RSA 2010
Assessee PAN AADFD8322M
Bench Chandigarh
Appeal Number ITA 916/CHANDI/2010
Duration Of Justice 7 month(s) 20 day(s)
Appellant DSM Multimedia,, Panchkula
Respondent ITO, (TDS), Panchkula
Appeal Type Income Tax Appeal
Pronouncement Date 31-01-2011
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted B
Tribunal Order Date 31-01-2011
Date Of Final Hearing 25-01-2011
Next Hearing Date 25-01-2011
Assessment Year 2003-2004
Appeal Filed On 10-06-2010
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL: B BENCH: CH ANDIGARH BEFORE HONBLE SHRI D K SRIVASTAVA AM AND HONBLE MS. SUSHMA CHOWLA JM ITA NO.916/CHANDI/2010 ASSESSMENT YEAR: 2 003-04 D.S.M MUTIMEDIA V. I.T.O. (TDS) SCO 54 SECTOR 8 PANCHKULA PANCHKULA PAN: AADFD 8322 M (APPELLANT-ASSESSEE) (RESPONDENT) APPELLANT BY: SHRI AJAY JAIN FCA RESPONDENT BY: SMT. SARITA KUMARI DR ORDER D K SRIVASTAVA: THE APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER PASSED BY THE LD. CIT ON 15.3.2010 ON THE FO LLOWING GROUNDS: 1 THAT THE ORDER PASSED BY THE AO U/S 201(1) & 201 (1A) IS BAD AS IT IS BARRED ON THE GROUND OF TIME LIMITATION. 2 THAT THE ORDER OF LD. CIT(A) IS BAD AND AGAINST THE FACTS AND LAW. 3 THAT THE LD. CIT(A) HAS ERRED BY HOLDING THAT TH E PROVISIONS OF SECTION 194C ARE APPLICABLE ON THE PAYMENTS MADE TO VARIOUS COPY RIGHT HOLDERS FOR PURCHASING FILM RIGHTS. 4 THAT THE LD. CIT(A) HAS ERRED BY UPHOLDING THE P ROVISIONS OF SECTION 201(1) AND WRONGLY UPHOLDING THE ACTION OF AO TO TREAT ASSESSEE IN DEFAULT AND WRONGLY CONFIRMED A DEMAND OF RS. 30621/-. 5 THAT THE LD. CIT(A) HAS ERRED IN UPHOLDING THE P ROVISIONS OF SECTION 201(1A) AND WRONGLY CONFIRMED THE INTEREST CHARGED AMOUNTING TO RS. 22 966/-. 6 THAT THE LD. CIT(A) HAS ERRED BY CONFIRMING THE ACTION OF AO WHO WRONGLY TREATED THE APPELLANT/ASSESSEE AS ASSES SEE IN DEFAULT WITHOUT MAKING ANY INQUIRY FROM THE PAYEE AS TO THE FACT WHETHER THE PAYEE HAS DISCHARGED HIS LIABILITY TO PAY TAX ON TH E INCOME RECEIVED FROM THE PAYER. 2. AT THE TIME OF HEARING THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE AO HAS PASSED THE ORDER U/S 201(1)/201(1A) OF T HE INCOME-TAX ACT FOR FINANCIAL YEAR 2002-03 ON 19.6.2009 I.E. MUCH AFT ER THE EXPIRY OF FOUR YEARS FROM THE END OF THE RELEVANT ASSESSMENT YEAR AND TH EREFORE WAS BARRED BY LIMITATION IN TERMS OF THE JUDGMENT OF THE HON'BLE DELHI HIGH COURT IN CIT V. D.S.M. MULTIMEDIA 916/CHANDI/2010 2 2 NHK JAPAN BROADCASTING CORPORATION 305 ITR 137 (DE LHI). IN REPLY THE LD. DR SUBMITTED THAT THERE WAS NO PERIOD OF LIMITATION PR ESCRIBED UNDER THE INCOME- TAX ACT FOR PASSING THE ORDER U/S 201 AND THEREFORE IT WOULD BE INCORRECT TO HOLD THAT THE ORDER PASSED BY THE AO WAS BARRED BY LIMITATION. 3. WE HAVE HEARD BOTH THE PARTIES. THE FACTS ARE NO T IN DISPUTE. THE AO HAS PASSED THE ORDER MUCH AFTER THE EXPIRY OF FOUR YEARS FROM THE END OF THE RELEVANT ASSESSMENT YEAR. THE LEARNED DR IS RIGHT I N HER SUBMISSIONS THAT NO PERIOD OF LIMITATION HAS BEEN PRESCRIBED UNDER THE INCOME-TAX ACT FOR PASSING THE ORDERS U/S 201. THE SHORT ISSUE THEREFORE IS WH ETHER THE AO CAN BE PERMITTED IN THE ABSENCE OF ANY PERIOD OF LIMITATI ON FIXED BY LAW TO PASS AN ORDER U/S 201 EVEN AFTER SEVERAL YEARS AFTER THE EX PIRY OF PERIOD DURING WHICH THE DEFAULT TAKES PLACE. 4. IN CIT V. NHK JAPAN BROADCASTING CORPORATION (SU PRA). THE HON'BLE DELHI HIGH COURT HAS HELD AS UNDER: 18 INSOFAR AS THE INCOME-TAX ACT IS CONCERNED OUR ATTENTION HAS BEEN DRAWN TO S 153(1)(A) THEREOF WHICH PRESCRIBES THE TIME-LIMIT FOR COMPLETING THE ASSESSMENT WHICH IS TWO YEARS FROM THE END OF THE ASSESSMENT YEAR IN WHICH THE INCOME WAS FIRST ASSES SABLE. IT IS WELL KNOWN THAT THE ASSESSMENT YEAR FOLLOWS THE PREVIOUS YEAR AND THEREFORE THE TIME LIMIT WOULD BE THREE YEARS FROM THE END OF THE FINANCIAL YEAR. THIS SEEMS TO BE A REASONABLE PERI OD AS ACCEPTED U/S 153 OF THE ACT THOUGH FOR COMPLETION OF ASSESSMENT PROCEEDINGS. THE PROVISIONS OF REASSESSMENT ARE U/SS 147 AND 148 OF THE ACT AND THEY ARE ON A COMPLETELY DIFFERENT FOOTING AND THEREFOR E DO NOT MERIT CONSIDERATION FOR THE PURPOSE OF THIS CASE. 19 EVEN THOUGH THE PERIOD OF THREE YEARS WOULD BE A REASONABLE PERIOD AS PRESCRIBED BY S 153 OF THE ACT FOR COMPLE TION OF PROCEEDINGS WE HAVE BEEN TOLD THAT THE TRIBUNAL HAS IN A SERIE S OF DECISIONS SOME OF WHICH HAVE BEEN MENTIONED IN THE ORDER WHICH IS UNDER CHALLENGE BEFORE US TAKEN THE VIEW THAT FOUR YEARS WOULD BE A REASONABLE PERIOD OF TIME FOR INITIATING ACTION IN A CASE WHERE NO L IMITATION IS PRESCRIBED. 20 THE RATIONALE FOR THIS SEEMS TO BE QUITE CLEAR IF THERE IS A TIME- LIMIT FOR COMPLETING THE ASSESSMENT THEN THE TIME- LIMIT FOR INITIATING THE PROCEEDINGS MUST BE THE SAME IF NOT LESS. NEVERTH ELESS THE TRIBUNAL HAS GIVEN A GREATER PERIOD FOR COMMENCEMENT OR INIT IATION OF PROCEEDINGS. D.S.M. MULTIMEDIA 916/CHANDI/2010 3 3 21 WE ARE NOT INCLINED TO DISTURB THE TIME-LIMIT OF FOUR YEARS PRESCRIBED BY THE TRIBUNAL AND ARE OF THE VIEW THAT IN TERMS OF THE DECISION OF THE HON'BLE SUPREME COURT IN BHATINDA D ISTRICT COOP. MIL P UNION LTD (SUPRA) ACTION MUST BE INITIATED BY THE C OMPETENT AUTHORITY UNDER THE INCOME-TAX ACT WHERE NO LIMITATION IS PRE SCRIBED AS IN S 201 OF THE ACT WITHIN THAT PERIOD OF FOUR YEARS. 5. RESPECTFULLY FOLLOWING THE AFORESAID JUDGMENT W E HOLD THAT THE ORDER PASSED BY THE AO U/S 201 IS BARRED BY LIMITATION AN D CONSEQUENTLY ALLOW THE APPEAL FILED BY THE ASSESSEE. SINCE WE HAVE ALREADY HELD THAT THE ORDER PASSED BY THE AO IS BARRED BY LIMITATION IT WOULD NOT BE APPROPRIATE TO DEAL WITH OTHER ISSUES RAISED BY THE ASSESSEE. APPEAL FILED B Y THE ASSESSEE IS ALLOWED IN TERMS OF AFORESAID OBSERVATIONS. ORDER PRONOUNCED ON JANUARY 2011 (SUSHMA CHOWLA) ( D K SRIVASTAVA) JUDICIAL MEMBER ACCOUNTANT ME MBER CHANDIGARH: THE JANUARY 2011 SURESH COPY TO: 1. THE APPELLANT D.S.M. MULTIMEDIA PANCHKULA 2. THE RESPONDENT ITO (TDS) PANCHKULA 3. THE CIT PANCHKULA 4. THE CIT(A) PANCHKULA 5. THE D.R INCOME-TAX DEPARTMENT CHANDIGARH TRUE COPY BY ORDER ASSISTANT REGISTRAR ITAT CHANDIGARH