BANK OF MAHARASHTRA,GREATER NOIDA vs. ADDLCIT, GHAZIABAD

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ITA 1683/DEL/2017Status: DisposedITAT Delhi16 July 2021AY 2007-083 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that NOIDA is constituted under a State Act and is therefore entitled to exemption from TDS under Section 194A(1) of the Income Tax Act. This position was confirmed by the Hon'ble Supreme Court.

What were the facts?

The assessee, Bank of Maharashtra, was treated as an assessee in default for not deducting TDS on interest paid to Yamuna Expressway Industrial Development Authority (NOIDA). The CIT(A) upheld the order, creating a demand against the appellant.

What were the issues?

Whether the assessee was liable to deduct TDS on interest paid to NOIDA, and whether NOIDA is entitled to exemption under Section 194A(1) of the IT Act.

Which sections of the Income-tax Act were involved?

Section 194A,Section 201(1),Section 201(1A)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH ‘A’, NEW DELHI

Before: Sh. Amit ShuklaDr. B. R. R. Kumar

For Respondent: Smt. Kirti Sankratyayan, Sr. DR
Hearing: 14.07.2021Pronounced: 16.07.2021

Per Dr. B. R. R. Kumar, Accountant Member:

1.

The present appeal has been filed by the assessee against the orders of ld. CIT (A)-I, Noida dated 24.01.2017.

2. Following grounds have been raised by the assessee:

1. That on the facts and circumstances of the case and in law, the learned Commissioner of Income-tax (Appeals) erred in upholding the order dated 21.03.2013 u/s 201(1) / 201(1A) of the I T Act, 1961 by the Addl. Commissioner of Income Tax (TDS), treating the assessee in default and by which a demand of Rs. 3,05,745/- was created against the Appellant.

2.

That on the facts and circumstances of the case and in law, the learned Commissioner of Income-tax

Bank of Maharashtra (Appeals) ought to have held that the Appellant was not liable to deduct tax at source u/s 194A of the I T act, 1961, on interest paid by it to Yamuna Expressway Industrial Development Authority. 3. That on the facts and circumstances of the case and in law, the learned Commissioner of Income-tax (Appeals) ought to have held that the Assessing Officer had no jurisdiction to pass the above order.

4. That on the facts and circumstances of the case and in law, the learned Commissioner of Income-tax (Appeals) ought to have held that the order by Assessing Officer is beyond the time limit prescribed under the Act to pass the order.

5. That on the facts and circumstances of the case, the learned Commissioner of Income-tax (Appeals) erred in dismissing the appeal on the basis of judgment dated 28.02.2011 by the Hon'ble Allahabad High Court in the case Noida Authority Vs The Chief Commissioner of Income Tax and Others and ignoring the judgment dated 04.04.2016 by the Hon'ble Allahabad High Court in the case Commissioner of Income Tax (TDS) and Another Vs. Canara Bank (2016) 69 Taxmann.Com 204 (Allahabad) cited and relied upon by the Appellant during the appellate proceeding.”

3.

The Assessing Officer passed order u/s 201(1) r.w.s. 194A of the Income Tax Act, 1961 directing the assessee, a bank to pay an amount of Rs.1,29,738/- on the interest paid of Rs.12,97,377/- to ‘NOIDA’.

4.

The issue of whether NOIDA constituted under the State Act and exemption of payment of tax at source under section 194-A(1) of the Act is entitled has been settled by the order of the Hon’ble Allahabad High Court in the case CIT Vs Canara Bank in ITA 64 of 2016 dated 04.04.2016. The question before the Hon’ble High Court was whether the ITAT as well as the Bank of Maharashtra Commissioner of Income Tax (A) have erroneously interpreted that NOIDA (New Okhla Industrial Development Authority) is a corporation established by U.P. Industrial Area Development Act, 1976 and not a body established under the aforesaid Act. Adjudicating on the this issue, the Hon’ble High Court held that no manner of doubt from a reading of the provisions of the Industrial Area Development Act that the NOIDA has been constituted by the State Act and, therefore, entitled to exemption of payment of tax at source under section 194-A(1) of the Act.

5.

The further appeal filed by the revenue before the Hon’ble Supreme Court stands dismissed vide order dated 02.07.2018 in Civil Appeal No. 6020 of 2018 by a detailed order. Since, the matter attained finality by the order of the Hon’ble Apex Court, we hereby hold that the provisions of TDS u/s 194A are not applicable to the case of the assessee with regard to the payment made to NOIDA.

6.

In the result, the appeal of the assessee is allowed. Order Pronounced in the Open Court on 16/07/2021.

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