District Manager, HAFED, Kurukshetra v. JCIT, TDS Range, Karnal

ITA 939/DEL/2018 | 2010-2011
Pronouncement Date: 31-08-2021 | Result: Allowed

Appeal Details

RSA Number 93920114 RSA 2018
Assessee PAN AAAJH0022R
Bench Delhi
Appeal Number ITA 939/DEL/2018
Duration Of Justice 3 year(s) 6 month(s) 24 day(s)
Appellant District Manager, HAFED, Kurukshetra
Respondent JCIT, TDS Range, Karnal
Appeal Type Income Tax Appeal
Pronouncement Date 31-08-2021
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted B
Tribunal Order Date 31-08-2021
Assessment Year 2010-2011
Appeal Filed On 06-02-2018
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL DELHI B BENCH: NEW DELHI (THROUGH VIDEO CONFERENCING ) BEFORE SHRI KUL BHARAT JUDICIAL MEMBER & DR.B.R.R.KUMAR ACCOUNTANT MEMBER ITA NO.939/DEL/2018 ASSESSMENT YEAR : 2010-11 DISTRICT MANAGER HAFED SITE NO.01 OPP.MAIN MARKET SECTOR-5 KURUKSHETRA HARYANA PAN-AAAJH0022R. VS JCIT TDS RANGE KARNAL HARYANA. APPELLANT RESPONDENT APPELLANT BY SH. KULWANT RAI CHHABRA ADV. RESPONDENT BY MS. ALKA GAUTAM SR.DR DATE OF HEARING 24.08.2021 DATE OF PRONOUNCEMENT 31 .08.2021 ORDER PER KUL BHARAT JM : THIS APPEAL FILED BY THE ASSESSEE PERTAINING TO ASS ESSMENT YEAR 2010-11 IS DIRECTED AGAINST THE ORDER OF LD. CIT(A) KARNAL DATED 16.11.2017. THE ASSESSEE HAS RAISED FOLLOWING GROUNDS OF APPEAL:- 1. ORDER PASSED BY LD.JCIT TDS AND CIT(A) ARE ILLE GAL ARBITRARY AND BAD IN LAW. 2. ON FACTS AND IN CIRCUMSTANCES OF THE CASE LD. JC IT AND CIT(A) WERE NOT JUSTIFIED IN IMPOSING PENALTY OF RS.6 32 267/- U/S 271C OF THE I.T.ACT ON THE DEFAULT WHICH WAS BONAFIDE AND OF TECHNICAL NATURE. 3. ON FACTS AND IN CIRCUMSTANCES OF THE CASE LD. JC IT AND CIT(A) WERE NOT JUSTIFIED IN IMPOSING PENALTY OF RS.6 32 267/- U/S 271C OF THE I.T.ACT ON THE DEFAULT WHICH WAS DUE TO LATE DEPOSIT OF TDS AND THE SAME WAS DEPOSITED DURING THE SAME FINANCIAL YEAR. ITA NO.939/DEL/2018 ASSESSMENT YEAR : 2010-11 PAGE | 2 2. THE ONLY EFFECTIVE GROUND IS AGAINST SUSTAINING THE PENALTY OF RS.6 32 267/- IMPOSED U/S 271C OF THE INCOME TAX AC T 1961 (THE ACT). 3. FACTS GIVING RISE TO THE PRESENT APPEAL ARE THAT TDS INSPECTION WAS CARRIED OUT ON 04.02.2010 AT THE PREMISES OF THE AS SESSEE. THEREAFTER ORDER U/S 201(1)/201(1A) OF THE ACT WAS PASSED ON 24.02.2 010 DECLARING ASSESSEES IN DEFAULT FOR NON-DEDUCTION OF TAX AT SOURCE ON PA YMENT OF RENT. THE ASSESSING OFFICER THEREAFTER INITIATED THE PENALT Y PROCEEDINGS U/S 271C OF THE ACT BY ISSUING SHOW CAUSE NOTICE DATED 19.10.2011. IN RESPONSE THERETO THE AUTHORIZED REPRESENTATIVE OF THE ASSESSEE APPEARED AND FILED ITS REPLY. HOWEVER THE EXPLANATION OF THE ASSESSEE WAS NOT FO UND ACCEPTABLE BY THE ASSESSING OFFICER AND HE PROCEEDED TO IMPOSE PENALT Y OF RS.6 32 267/- U/S 271C OF THE ACT. 4. AGGRIEVED AGAINST THIS THE ASSESSEE PREFERRED T HE PRESENT APPEAL BEFORE LD.CIT(A) WHO ALSO SUSTAINED THE PENALTY AND DISMIS SED THE APPEAL OF THE ASSESSEE. 5. AGGRIEVED AGAINST THIS THE ASSESSEE PREFERRED A PPEAL BEFORE THIS TRIBUNAL. 6. LD. COUNSEL FOR THE ASSESSEE REITERATED THE SUBM ISSIONS AS MADE BEFORE LD.CIT(A). LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT NON-DEDUCTION OF TAX WAS NOT DELIBERATE. IT WAS UNDER THE BONAFIDE BELI EF THAT THE ASSESSEE WAS NOT LIABLE TO DEDUCT TAX. IT IS SUBMITTED THAT THE PAYM ENT WAS MADE FOR BOOKING OF SPACE ONLY. HENCE IT WAS BELIEVED THAT NO TAX IS REQUIRED TO BE PAID ON SUCH PAYMENT. HE FURTHER SUBMITTED THAT THE ASSESSEE BEI NG INSTRUMENTALITY OF GOVERNMENT WOULD NOT EVADE TAX. LD. COUNSEL FOR T HE ASSESSEE SUBMITTED AS ITA NO.939/DEL/2018 ASSESSMENT YEAR : 2010-11 PAGE | 3 SOON AS IT CAUSE TO THE NOTICE OF THE ASSESSEE THAT THE ASSESSEE WAS REQUIRED TO DEDUCT TAX. THE ASSESSEE DEPOSITED THE ENTIRE TAX AND INTEREST THEREON IN THE GOVERNMENT ACCOUNT. LD. COUNSEL FOR THE ASSESSEE F URTHER PLACED RELIANCE ON THE JUDGEMENT OF HONBLE SUPREME COURT IN THE CASE OF HINDUSTAN COCA COLA BEVERAGES PVT.LTD. VS CIT [2007] 163 TAXMAN 355 (SC ) TO BUTTRESS THE CONTENTION THAT THE TAX ALONGWITH INTEREST THEREON HAS BEEN PAID. MOREOVER THE DEDUCTEE HAS DISCLOSED THE AMOUNT IN ITS RETURN OF INCOME. IN THESE CIRCUMSTANCES NO PENALTY OUGHT TO HAVE BEEN IMPOSE D ON THE ASSESSEE. HE FURTHER SUBMITTED THAT THE AUTHORITIES BELOW HAVE N OT CONSIDERED THE CASE LAW AS RELIED ON BY THE LD. COUNSEL FOR THE ASSESSEE DU RING THE FIRST APPELLATE PROCEEDINGS. 7. PER CONTRA LD. SR. DR OPPOSED THESE SUBMISSIONS AND SUPPORTED THE ORDERS OF THE AUTHORITIES BELOW. LD. SR. DR SUBMIT TED THAT ONLY EXPLANATION OFFERED BY THE ASSESSEE IS WITH REGARD TO PAYMENT M ADE TO THE OWNER OF THE SPACES IN THE NATURE OF ADVANCE FOR BOOKING OF SPAC E. THE ASSESSEE WAS REQUIRED TO DEDUCT TAX ON PAYMENT OF RS.27 90 240/- AS MADE TO M/S HARYANA WAREHOUSING CORPORATION. HENCE THE ASSESSING OFFI CER HAS RIGHTLY HELD THAT THE ASSESSEE IN DEFAULT AND PROCEEDED TO IMPOSE PEN ALTY U/S 271C OF THE ACT. THE ENTIRE STORY AS NOW STATED BY LD. COUNSEL FOR T HE ASSESSEE IS AFTER THOUGHT TO AVOID THE RIGOURS OF SECTION 271C OF THE ACT. T HE ASSESSEE HAS GROSSLY FAILED TO PROVE ITS BONAFIDE FOR NON-DEDUCTION OF TAX ON SOURCE ON THE PAYMENT MADE WHICH WAS ESSENTIALLY ADVANCE RENT. 8. WE HAVE HEARD CONTENTIONS OF BOTH AUTHORIZED REP RESENTATIVES AND PERUSED THE MATERIAL AVAILABLE ON RECORD. THE ONL Y EXPLANATION FOR NON- ITA NO.939/DEL/2018 ASSESSMENT YEAR : 2010-11 PAGE | 4 DEDUCTION OF TAX BY THE ASSESSEE IS THAT THE AMOUNT PAID TO M/S. HARYANA WARE HOUSING CORPORATION WAS BOOKING ADVANCE FOR THE SPA CE. FURTHER IT IS ALSO STATED THAT UNDER THE BONAFIDE BELIEF THAT NO TAX I S LIABLE TO BE DEDUCTED ON SUCH AMOUNT THE ASSESSEE DID NOT DEDUCT TAX. WHEN IT CAME TO THE NOTICE OF THE ASSESSEE THE ENTIRE AMOUNT ALONGWITH INTEREST THEREON WAS DULY DEPOSITED WITH THE GOVERNMENT ACCOUNT. IN THESE FACTS AND CI RCUMSTANCES IT WAS ARGUED THAT THERE IS NO LOSS OF REVENUE HENCE PENALTY U/ S 271C OUGHT NOT TO HAVE BEEN IMPOSED AND SUSTAINED BY THE LD.CIT(A). IT IS ARGUED THAT THE ASSESSEE HAS DEMONSTRATED BONAFIDE REASON FOR NON-DEDUCTION OF TAX THEREFORE AUTHORITIES BELOW OUGHT NOT TO HAVE IMPOSED THE PEN ALTY IN TERMS OF SECTION 273B OF THE ACT. LD. COUNSEL FOR THE ASSESSEE HAS ALSO PLACED RELIANCE ON THE JUDGEMENT OF HINDUSTAN COCA COLA BEVERAGES PVT.LTD. VS CIT (SUPRA) TO BUTTRESS THE CONTENTION WHERE THE ASSESSEE HAS DEPOSITED TAX AND INTEREST THEREON AND DISCLOSED THE INCOME IN THE RETURN OF INCOME NO DI SALLOWANCE IS CALLED FOR. IT IS FURTHER STATED THAT HARYANA WARE HOUSING CORPORATIO N HAS ALSO DISCLOSED THIS INCOME AND DUE TAXES HAVE ALREADY BEEN PAID. 8.1. LOOKING TO THE PECULIARITY OF THE CASE AND COU PLED WITH THE FACT THAT DUE TAXES ALONGWITH INTEREST THEREON HAVE BEEN DEPOSI TED IN THE GOVERNMENT ACCOUNT. THIS FACT IS NOT CONTROVERTED BY THE LD. DEPARTMENTAL REPRESENTATIVE. UNDER THE FACTS AND CIRCUMSTANCES OF THE PRESENT CA SE THE ASSESSEE HAS DEMONSTRATED THE BONAFIDE FOR NON-DEDUCTING THE TAX . WE THEREFORE DIRECT THE ASSESSING OFFICER TO DELETE THE PENALTY OF RS.6 32 267/- IMPOSED U/S 271C OF THE ACT. THUS GROUNDS RAISED BY THE ASSESSEE ARE ALLOWED. ITA NO.939/DEL/2018 ASSESSMENT YEAR : 2010-11 PAGE | 5 9. IN THE RESULT THE APPEAL OF THE ASSESSEE IS ALL OWED. ABOVE DECISION WAS PRONOUNCED ON CONCLUSION OF VIRT UAL HEARING IN THE PRESENCE OF BOTH THE PARTIES ON 31 ST AUGUST 2021. SD/- SD/- (DR. B.R.R.KUMAR) (KUL BHARAT) ACCOUNTANT MEMBER JUDICIA L MEMBER *AMIT KUMAR* COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI