M N Dastur Amp Co Pvt Ltd Kolkata v. Acit Cir 2 Tds Kolkata Kolkata

D In The Income Tax Appellate Tribunal Kolkata Bench D Kolkata Before Shri Waseem Ahmed Accountant Member And Shri S S Viswanethra Ravi Judicial Member Ita No 919 920 Kol 2016 Assessment Years 2008 09 2010 11 M N Dastur Co Pvt Ltd P 17 Mission Row Extension Kolkatda 13 Pan No Calmo 0350 A V S Acit Circle 2 Tds 10 B Middleton Row 7 Th Floor Kolkata 71 Appellant Respondent By Assessee Shri P K Acharyya Advocate By Revenue Shri Saurabh Kumar Addl Cit Dr Date Of Hearing 24 10 2017 Date Of Pronouncement 06 12 2017 O R D E R Per Waseem Ahmed Accountant Member Both Appeal By The Assessee Are Directed Against Th E Orders Of Commissioner Of Income Tax Appeals 24 Kolkata Dated 11 02 2016 P Assed U S 200 A Of The Income Tax Act 1961 Hereinafter Referred To As The Act For Assessments Year 2008 09 2010 11 Shri P K Acharyya Ld Advocate Appeared On Behalf Of Assessee And Shri Sauarabh Kumar Ld Departmental Representative Appeared On Behalf Of Revenue 2 Both Appeals Are Heard Together And Being Dispos Ed Off By This Consolidated Order For The Sake Of Convenience First We Take Up Ita No 919 Kol 2016 For A Y 08 09 3 The Assessee Has Raised Following Grounds Of App Eal Which Reproduced Below Ita No 919 920 Kol 2016 A Ys 08 09 10 11 M N Dastur Co Pvt Ltd Vs Cit Cir Tds Ko Page 2 1 That On Facts And Circumstances Of The Case The Ld Cit Appeals 24 Has Erred In Not Allowing The Appellants Ground That Th Ere Was An Excess Payment Of Rs 73 360 In The Month Of July 2007 2 That On Facts And Circumstances Ld Cit Appeals 24 Of The Case The Ld Cit Appeals 24 Has Erred In Not Allowing The Appel Lants Ground That The Excess Payment Of Rs 73 360 Made In The Previous Mo Nth I E In July 2007 Been Set Off Against The Payment For The Month Of August 2007 In The Same Quarter Of Tds Return 3 That On Facts And Circumstances Of The Case Ld Cit Appeals 24 Has Wrongly Confirmed The Interest Of Rs 42550 U S 201 1 A 5 That The Appellant Craves Leave To Add Alter Or Withdraw Any Ground Or Grounds Of Appeal At Or Before The Hearing Of Appea L 4 First Issue Raised By Assessee In Ground No 1 2 Is That Ld Cit A Erred In Not Adjusting The Excess Amount Paid For 73360 00 Only Towards The Amount Tax Deducted At Source Tds In The Subsequent Month 5 Briefly Stated Facts Are That Assessee Is A Priv Ate Limited Company And Engaged In The Business Of Consultancy Advisory Services Engineering Project And Various Other Allied Jobs The Assessee In The Second Quart Er Of Financial Year 2007 08 Has Deposited Paid The Amount Of Tds As Detailed Under Date Of Deposit Related To Month Amount Rs Challan Sr No 07 8 07 July 2007 2093500 1458 07 09 07 August 2007 1939990 1204 06 10107 September 2007 5845515 1259 However Assessee Further Submitted That The Liabil Ity To Deposit The Tds Amount For The Month Of July 2007 Was At 22 20 140 But Assessee Has Deducted And Deposited A Sum Of 20 93 500 Dated 07 08 2007 Thus The Excess Amou Nt Of 73 360 Was Deposited Towards The Tds The Assessee In The Subs Equent Month I E August 07 Has Adjusted The Excess Amount Of Tds And Deposited Th E Remaining Amount For 19 39 990 2013350 73360 However Assessing Officer Failed To Allow The Credit Of The Excess Amount Paid By The Assessee Fo R 73 360 In Its Intimation Issued U S 200 A Of The Act Thus A Demand Of 73 360 On Account Of Short Payment Of Tax Was Raised The Ao Consequentially Charged The Amou Nt Of Interest For 42 550 On The Short Amount Of Tds Ita No 919 920 Kol 2016 A Ys 08 09 10 11 M N Dastur Co Pvt Ltd Vs Cit Cir Tds Ko Page 3 6 Aggrieved Assessee Preferred An Appeal Before L D Cit A Who Confirmed The Order Of Ao By Observing As Under 4 The Details Of Short Payment Amount And Interes T Are Given In Justification Report Which Is Part Of The Order U S 200 A Of The I T Act Dated 31 10 2011 The Copy Of The Said Justification Report Has Not Been Filed Without Referring To The Said Justification Report It Is Difficult To Apprec Iate What Is Wrong In The Computation Of Amount And Interest Towards Short Pa Yment As Given In The Intimation U S 200 A Of The It Act In The Copy Of A Pplication For Rectification Dated 05 06 2012 Enclosed As Annexure V To The Submission In Appeal The Appellants A R Is Not Clear What Is Wrong If Any With The Without Specifically Pointing Out The Default Picked Up By The Assessing Officer As Per Justification Report On The Basis Of This Rectification Request It Is Difficult To Appreciate Whether There Is Any Error In The Aos Calculation Vaguely Raising The Claim That The Above Amounts Of Tds Payment Were Not Allo Wed Credit Does Not Meet The Purpose Which Is To Point Out The Mistake 5 In The Submission Dated 02 02 2016 Filed In The Appeal Hearing On 4 2 2016 Slightly More Specific Claim Has Been Made As Repro Duced Above In Para 3 The Claim Is That He Deposit In July Was In Excess Of D Eductible By Rs 73 360 Which Was Adjusted In The Month Of August Against T He Deductible To Rs 20 13 350 In Other Words The Claim Is That Rs 73 360 Was Adjusted Against Deduction Of August And Accordingly Deposit In August Was Less Than The Deducted Amount The Claim Is Made That The Sta Tement Dated 7 9 2007 Is Enclosed As Annexure Iv But The Said Annexure Is On Ly A Table Self Prepared By The Ape Though Explanation Seems Convincing It Ca Nnot Be Accepted Because Any Claim Has To Be Mad With Reference To The Justi Fication Report Forming Part Of The Intimation U S 200 A Which Has Been Challeng Ed It Is Surprising Why The Explanation Of Such Nature Has Been Filed Without E Ven A Copy Of The Justification Report Even 154 Application To The A O Is Vague And Much Short Of Even Indicating The Error If Any In The Assessing O Fficers Intimation Dated 31 10 2011 No Copy Of The Traces Has Been Made Ava Ilable Even In Appeal There Is No Reference To The Return Of Tds Statemen Ts Filed To The Department 6 I Therefore Find It Difficult To Allow The Gro Unds Merely On The Basis Of The Submission Dated 02 02 2016 As It Does Not Rely On The Primary Papers From Which The Amount Of Tds Deductible Deducted And De Posited Can Be Worked Out Aggrieved By The Above Finding Of Ld Cit A The A Ssessee Is In Appeal Before The Tribunal 7 Ld Ar Before Us Submitted That Claim Of Assesse E Was Rejected By Ld Cit A On The Ground That It Failed To File The Copy Of Ju Stification Report He Further Submitted That At The Time Of Hearing Before Ld Cit A The J Ustification Report Was Not Submitted Due To A Fire Broke Out In The Building P Remises Of Income Tax Department Ita No 919 920 Kol 2016 A Ys 08 09 10 11 M N Dastur Co Pvt Ltd Vs Cit Cir Tds Ko Page 4 Ld Ar Further Submitted That The Justification Rep Ort Is Now Available With It And Therefore He Prayed Before The Bench That The Matte R Can Be Restored Back To The File Of Ld Cit A For Fresh Adjudication In Accordance Wit H Law On The Other Hand Ld Dr Agreed To The Submission Of The Ld Ar For The Assessee 8 We Have Heard The Rival Contentions Of Both The Parties And Perused The Material Available On Record At The Outset We Fin D That The Appeal Was Rejected By Ld Cit A On The Ground Of Non Availability Of Justifi Cation Report However Ld Ar For The Assessee Before Us Claimed That The Justificati On Report Is Now Available Which In Our View Requires To Be Considered By Ld Cit A In View Of The Above Proposition In The Interest Of Natural Justice And Fair Play We Restore The Matter Back To The File Of Ld Cit A For Fresh Adjudication In Accordance Wit H Law Hence This Ground Of Assessees Appeal Is Allowed For Statistical Purpos E 9 Next Issue Is Consequential In Nature And Does N Ot Require Any Adjudication 10 Last Issue Is General In Nature And Does Not Re Quire Any Separate Adjudication Coming To Ita No 920 Kol 2016 For A Y 10 11 11 The Grounds As Raised By The Assessee Reads As Under 1 That On Facts And Circumstances Of The Case Ld Cit Appeals 24 Has Erred In Confirming That There Is A Late Payment Of Tax I N The Second Quarter Of The Financial Year 2009 2010 2 That On Facts And Circumstances Of The Case The Ld Cit Appeals 24 Has Erred In Confirming The Interest Of Rs 44816 Under Section 201 1 A 3 That On Facts And Circumstances Of The Case The Ld Cit Appeals 24 Has Erred In Confirming That There Is A Short Deduction Of Rs 27580 In The Fourth Quarter Of Financial Year 2009 10 4 That The Appellant Craves Leave To Add Alter Or Withdraw Any Ground Or Grounds Of Appeal At Or Before The Hearing Of Appea L 12 Ground No 1 And 2 Are Inter Related And Therefo Re Being Taken Up Together The Issue Raised By Assessee Is That Ld Cit A Erred I N Confirming The Amount Of Interest For 44 81 U S 201 1 A Of The Act On Account Of Late Deposit Of Tds 13 At The Outset Ld Ar Brought To Our Notice Tha T Assessee Was Liable To Deposit The Amount Of Tds Pertaining To The Month Of July 2009 On 07 08 2009 But There Was All India Bank Strike On 6 Th And 7 Th August 2009 For This Reason Tds Amount Was Not Deposited Within The Time As Specified Under The A Ct Thus Assessee Has Deposited The Ita No 919 920 Kol 2016 A Ys 08 09 10 11 M N Dastur Co Pvt Ltd Vs Cit Cir Tds Ko Page 5 Amount Of Tds On 08 08 2009 So The Delay In Deposit Ing The Tds Amount Occurred Due To No Fault On The Part Of Assessee In View Of Above Ld Ar Prayed Before Us For Waiver Of Interest On The Other Hand Ld Dr Vehemently Relied On The Order Of Authorities Below 14 We Have Heard The Rival Contentions Of Both The Parties And Perused The Material Available On Record The Issue In The Inst Ant Case Relates To The Amount Of Interest Charged U S 201 1 A Of The Act On Account Of Late Deposit Of Tds Amount Indeed There Was A Delay For Just One Day In The D Eposit Of Tds Amount Moreover The Reason For Delay In The Depositing Of Tds Was Beyon D The Control Of Assessee As There Was All India Bank Strike On 6 Th And 7 Th August 2009 It Is Well Settled That An Obligation Gets Dischar Ged Due To Impossibility Of Performance The Assessee In The Instant Case Has B Een Paying The Amount Of Tds Well In Time But For The Impugned Month The Payment Was Delayed For A Day For The Reasons Beyond The Control Of The Assessee I E Due To All India Banks Strike The Law Of Impossibility Of Performance Does Not Necessaril Y Require Absolute Impossibility But Also Encompass The Concept Of Severe Impractica Bility In Our Humble Opinion The Doctrine Of Impossibility Of Performance Applies In This Case Due To Uncontrollable Circumstances The Performance Of The Obligation To Deposit The Tax At Source To The Government Exchequer Became Impossible Within The T Ime The Impossibility Of Performance Releases The Assessee From Its Obligati On To Deposit The Tax At Source Within In The Time A Default Occurs Only When An O Bligation Is Not Performed When The Assessee Is Released From The Obligation It Ca Nnot Be Said That It Is In Default Thus When The Assessee Was Prevented From Depositing The Tax To Government Exchequer Within The Time The Question Of Its Not Performing The Obligation Under Law Does Not Arise And Thus It Cannot Be Held A Defaulter We Al So Find Support From The Legal Maxim Lex Non Cogit Ad Impossibilia Meaning Thereby That The Law Does Not Compel A Man To Do What He Cannot Possibly Perform In Holding S O We Find Support Guidance From The Judgment Of Honble Supreme Court In The C Ase Of Krishna Swamy S Pd Anr Vs Union Of India Ors Reported In 281 Itr 30 5 Wherein It Was Held That The Other Relevant Maxim Is Lex Non Cogit Ad Impossibilia The Law Does Not Compel A Man To Do What He Cannot Possibly Perform The La W Itself And Its Administration Is Ita No 919 920 Kol 2016 A Ys 08 09 10 11 M N Dastur Co Pvt Ltd Vs Cit Cir Tds Ko Page 6 Understood To Disclaim As It Does In Its General Ap Horisms All Intention Of Compelling Impossibilities And The Administration Of Law Must Adopt That General Exception In The Consideration Of Particular Cases See U P S R T C Vs Imtiaz Hussain 2006 1 Scc 380 Shaikh Salim Haji Abdul Khayumsab Vs Kuma R Ors 2006 1 Scc 46 Mohammod Gazi Vs State Of M P Ors 2000 4 Scc 342 And Gursharan Singh Vs New Delhi Municipal Committee 1996 2 Scc 459 Thus In View Of Above We Hold That The Assessee Wou Ld Be Discharged From Such An Obligation And Hence Cannot Be Regarded A Defaulter Thus The Ground Of Appeal Raised By The Assessee Is Allowed And Ao Is Directed Accor Dingly 15 Next Issue Raised By Assessee In This Appeal Is That Ld Cit A Erred In Confirming The Order Of Ao By Holding That There Wa S Short Deduction Of Tds Amount For 27 580 In The Fourth Quarter For Financial Year 2 009 10 16 During The Course Of Proceedings Ao Issued Int Imation U S 200 A Of The Act By Raising The Demand Of 27 580 On Account Of Short Payment Of Tds Along With Interest For 5 240 Only 17 Aggrieved Assessee Preferred An Appeal Before Ld Cit A Who Confirmed The Order Of Ao By Observing As Under 2 Addition Al Grounds Have Been Raised By Way Of Letter Dated 23 03 2015 In Respect Of Short Deduction Of Tax And Interest Ther Eon No Copy Of Justification Report Forming Part Of The Intimidation U S 200 A O F The It Act Dated 27 10 2011 Has Been Enclosed To Either Form 35 Or Various Subm Issions Or Additional Grounds It Is Therefore Difficult To Appreciate How The Short Deduction Can Be Claimed To Have Been Wrongly Computed By The Ao I Therefore Find Difficult To Entertain The Additional Ground Thus Raised It Is Therefore Also Not Allowed Being Aggrieve By The Finding Of Ld Cit A Assesse E Came In Second Appeal Before Us 18 Ld Ar Before Us Submitted That There Was No Sh Ort Deduction Of Tds Amount As Alleged By Ao He Further Submitted The Appeal W As Dismissed By Ld Cit A As Assessee Failed To File Justification Report Now T He Report Is Available And Therefore He Prayed Before The Bench That The Matter Can Be Rest Ored Back To The File Of Ld Cit A For Fresh Adjudication In Accordance With Law Ita No 919 920 Kol 2016 A Ys 08 09 10 11 M N Dastur Co Pvt Ltd Vs Cit Cir Tds Ko Page 7 On The Other Hand Ld Dr Fairly Agreed With The Su Bmissions Of Ld Ar For The Assessee 19 We Have Heard The Rival Contentions Of Both The Parties And Perused The Material Available On Record At The Outset We Hav E Already Decided The Same Issue In Assessees Appeal In Ita No 919 Kol 2016 For A Y 2 008 09 And Taking A Consistent View And In The Interest Of Natural Justice And Fai R Play We Restore The Matter Back To The File Of Ld Cit A For Fresh Adjudication In Ac Cordance With Law Hence This Ground Of Assessees Appeal Is Allowed For Statisti Cal Purpose 20 Last Issue Is General Needs No Adjudication 21 In The Result For The Statistical Purpose Both Th E Appeal Of Assessee Is Treated As Allowed Order Pronounced In Open Court On 06 12 2017 Sd Sd S S Viswanethra Ravi Waseem Ahmed Judicial Member Accountant Member Dkp Sr P S 06 12 2017 Kolkata Copy Of Order Forwarded To 1 Assessee M N Dastur Co Pvt Ltd P 17 Mission Row Extension Kolkata 13 2 Revenue Acit Circle 2 Tds 10 B Middleton Row 7 Th Fl Kolkata 71 3 Concerned Cit 4 Cit A 5 Dr Itat Kolkata 6 3 Guard File By Order True Copy Sr Private Secretary Head Of Office Ddo