ITO (TDS), ROURKELA vs. PENGUIN TRADING & AGENCIES PVT. LTD., KEONJHAR

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ITA 26/CTK/2018Status: DisposedITAT Cuttack06 August 2019AY 2013-142 pages
AI SummaryAllowed

What did the Tribunal hold?

The CIT(A) was justified in deleting the demand raised under Section 206C(6) and interest under Section 206C(7). The tribunal likely found that the assessee's explanation regarding the declaration forms, despite initial defects, warranted a different treatment than the AO's outright rejection.

What were the facts?

During a TDS inspection, the Assessing Officer (AO) found that the assessee, engaged in iron ore mining, failed to collect Tax Collected at Source (TCS) on sales from July to November 2012. The assessee claimed buyers submitted declaration forms (27C) for non-collection, but the AO rejected these forms due to defects and non-compliance with submission rules.

What were the issues?

Whether the CIT(A) was correct in deleting the demand for non-collection of TCS and interest, considering the assessee's submission of declaration forms with alleged defects and non-compliance with procedural requirements.

Which sections of the Income-tax Act were involved?

Section 206C(1),Section 206C(1B),Section 206C(6),Section 206C(7)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, CUTTACK BENCH, CUTTACK

Before: SHRI CHANDRA MOHAN GARG & LAXMI PRASAD SAHU

For Respondent: Shri Subhendu Dutta, DR
Hearing: 31/07Pronounced: 6/08

Per L.P.Sahu, AM

This is an appeal filed by the Revenue against the order dated 31.10.2017 of the CIT(A), Cuttack for the assessment year 2013-14.

2.

The sole issue involved in this appeal is that the CIT(A) was not justified in deleting the demand raised u/s.206C(6) of Rs.65,18,020/- and interest levied u/s.206C(7) of Rs.2,57,267/- totaling to Rs.67,75,287/- of the I.T.Act, 1961.

3.

The facts in brief are the assessee is engaged in the business of mining of iron ore, export of embroidered fabrics & other commodities. A TDS inspection was conducted by the Assessing Officer on 18.12.2012 in the business premises of the assessee. During the course of inspection, the Assessing Officer found that no tax had been collected at source as per the provisions of section 206C(1) on the

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ITA No.26/CTK/2018 Ass essment Year : 2013- 14

sale of iron ore from July, 2012 to November, 2012. However, during the above

sale of iron ore was effected of Rs.64,68,89,039/- and, therefore, TCS to be

collected @ 1% amounted to Rs.64,68,890/- and the assessee has deposited TCS

only Rs.1,79,694/-. In view of above, there was shortfall in TCS of Rs.62,89,196/-.

Before the AO, it was submitted that the buyers had submitted declaration form

No.27C for non-collection of TCS and, therefore, no TCS was collected. The AO

found that the 15 number of declaration forms submitted at the time of inspection

did not bear any date and the Part-II of the same had not been filled in and signed.

The AO also noted that copies of the declaration forms had not been delivered to

the CCIT/CIT as per the provisions of section 206C(1B) of the Act. Accordingly, the

AO issued a show cause notice initially in response to which the assessee

submitted in writing that it had not collected TCS from the parties who had given

27C forms being manufacturers and that all these forms would be submitted if

some time was allowed. Subsequently, in response to the final show cause notice

of the AO, the assessee submitted 76 declaration forms in Form No.27C relating to

25 parties along with the details of sales made to them. However, the AO did not

accept those declaration forms because of certain defects found therein and also

for the reason that all those declaration forms were not filed at the time of TCS

inspection. The AO also refused to take the declaration forms into consideration

because copies of the same were not delivered to the CCIT/CIT having jurisdiction

over the assessee as per the provisions of section 206C(IB) and were submitted to

the CIT-3, Kolkata only on 21.1.2013. Finally, the AO raised a demand of

Rs.65,18,020/- u/s.206C(6) and levied interest thereon of Rs.2,57,267/-

u/s.206C(7).

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