M/S. RAKESH KUMAR JAIN,CHAMPA (CG) vs. ITO, WARD- 2(2), BILASPUR(CG)

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ITA 27/BIL/2015Status: DisposedITAT Raipur29 September 2021AY 2010-113 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal decided to remand the issue back to the AO for fresh determination. This was to ascertain if the payee had paid the relevant taxes on the disputed interest amount, as per the assessee's submission.

What were the facts?

The assessee challenged additions made by the AO and confirmed by the CIT(A). During the appeal, the assessee did not press one addition, leaving only the addition on account of interest paid on finance charges for non-deduction of TDS.

What were the issues?

Whether the addition on account of interest paid on finance charges for non-deduction of TDS is sustainable if the recipient has already paid taxes on that income.

Which sections of the Income-tax Act were involved?

Section 250(6)

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Income Tax Appellate Tribunal, RAIPURBENCH, RAIPUR

Before: SHRI PRADIP KUMAR KEDIA, HONBLE & SHRIN.K. CHOUDHRY, HON’BLE

For Appellant: Shri R.B. Doshi, CA
For Respondent: Shri Sanjay Kumar, DR
Hearing: 02/08/2021

O R D E R PER N.K. CHOUDHRY, JUDICIAL MEMBER

This appeal has been preferred by the Assessee against the order dated 18/04/2013 impugned herein passed by the Ld. Commissioner of Income Tax (Appeal) [for short, ‘ld. Commissioner], Bilaspur u/sec. 250(6) of the Income Tax Act, 1961 (hereinafter referred to as the "Act") for the A.Y. 2010-11.

2 (M/s. Rakesh Kumar Jain) 2. The Assessee, though, has challenged two additions of Rs.8,24,777/- on account of net profit and Rs. 5,65,084/- on account of interest paid on finance charges made by the AO and confirmed by the ld. Commissioner, however, during the hearing of appeal, the Assessee did not press addition of Rs. 8,24,777/- on account of net profit. Therefore, the only issue for consideration before us relates to the addition of Rs. 5,65,084/- on account of interest paid on finance charges. This amount was added in the income of the Assessee for non-deduction of TDS by the AO and sustained by the Ld. Commissioner.

3.

The ld.AR prayed that the issue may be remitted to the file of the AO for determination afresh while considering the factual position qua paying of income-tax on the said amount of addition by the payee because as per Assessee’s knowledge the payee has paid the relevant taxes. On the other hand, ld.DR raised no objection.

4.

Considering the peculiar facts and circumstances, in the interest of justice and for the just decision of the case, we deem it appropriate to remand the issue in hand to the file of the AO for factual determination in view of dictum laid down by the Hon'ble Apex Court in the case of Hindustan Coca Cola Beverage Pvt. Ltd. Vs. CIT (2007) 293 ITR 226 (SC), as to whether payee (recipient) has paid the relevant taxes on the addition of Rs. 5,65,084/- on account of interest paid on finance charges, and to decide afresh the liability of the Assessee, if any.

3 (M/s. Rakesh Kumar Jain) We may clarify that onus would be on the Assessee to substantiate its case either side, however, the AO would be at liberty to call for records of the payee for just decision of the case. 5. In the result, appeal filed by the assessee stands allowed for statistical purpose. Order Pronounced on dated 29-09-2021 as per rule 34(4) of the IT (Appellate Tribunal) Rules.

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