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Income Tax Appellate Tribunal, “A” BENCH, PUNE
Before: SHRI D. KARUNAKARA RAO, AM & SHRI VIKAS AWASTHY, JM
आदेश / ORDER PER BENCH :
These 53 appeals filed by the various branches of the assessee bank are against the orders of Commissioner of Income Tax (Appeals)-8 / 10, Pune passed u/s. 201(1) and 201(1A) of the Income Tax Act, 1961
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(hereinafter referred to as “the Act”) in their respective cases. These appeals pertain to assessment years 2009-10 and 2010-11 as mentioned in the memo of parties against the respective title of appeal.
Since, the issue raised in all these bunch of appeals is identical, these appeals are taken up together for adjudication and are disposed of vide this common order.
Shri A.V. Iyer appearing on behalf of the assessee submitted that the Department sought information relating to Tax Deducted at Source (TDS) on interest payments to its customers from various branches of the assessee bank located in Pune and Solapur. The ld. AR submitted that out of total 53 appeals, 21 appeals pertain to assessment year 2009-10. The information regarding TDS on the interest payments was sought by the Assessing Officer for the period relevant to assessment year 2009-10 sometimes in the end of January, 2016. Based on the information received from various branches of the assessee, show cause notices were issued to the Branches of assessee by Assessing Officer on 05-03-2016 seeking various information on TDS by 22-03-2016. The Head Office of the bank submitted information in respect of all the branches through e- mail to Assessing Officer on 21-03-2016. Not satisfied with the information furnished, the Assessing Officer passed the order u/s. 201(1) and 201(1A) in the case of all the respective Branches of the assessee bank.
2.1 The ld. AR submitted that similarly in other 32 appeals, the Assessing Officer sought information pertaining to assessment year 2010-11 in the month of January, 2017. Show cause notice was issued to various branches of assessee Bank in the first/second week of
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January, 2017 and without affording sufficient opportunity of hearing, order u/s. 201(1) and 201(1A) of the Act was passed by the Assessing Officer.
2.2 The ld. AR submitted that a perusal of documents on record would reveal that the information/data sought by the Assessing Officer was relating to period about 6 years old. The old records were stored in godown and it was time consuming to retrieve the information from the documents stored in godown in a short span of time provided by the Assessing Officer. The volume of data to be searched for furnishing the information was huge. The assessee tried it level best to retrieve the information / documents as far as possible and submitted the same before the Assessing Officer within the period of two weeks time. The assessee inter alia furnished following documents :
i. Certificate of Nil/lower deduction of tax in respect of some deposit holders.
ii. Income Tax returns of various depositors wherein the bank failed to deduct TDS but the depositors have fully disclosed interest received from the bank and have paid taxes thereon.
iii. Details of the depositors wherein interest was paid on maturity but no tax at source was deductable.
2.3 The ld. AR submitted that though effort was made to furnish the entire information available in short span, but due to paucity of time and voluminous records to be searched, entire information could not be retrieved, as the information sought was almost 6 years old. This resulted in mismatch of data available with the assessee and the
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information with the Assessing Officer. The Assessing Officer passed the orders in the case of respective Branches of assessee Bank making additions u/s. 201(1) and 201(1A) of the Act. The assessee carried the issue in appeal before the Commissioner of Income Tax (Appeals). The Commissioner of Income Tax (Appeals) without affording sufficient opportunity of hearing to the assessee again confirmed the additions. In the meantime the assessee has retrieve some more information from its records in respect of depositors for the period relating to assessment years 2009-10 and 2010-11. The ld. AR submitted that if an opportunity is granted to the assessee, the assessee would show that no addition u/s. 201(1) and no liability of interest u/s. 201(1A) is warranted.
2.4 The ld. AR submitted that though in the grounds of appeal no ground has been raised challenging the validity of orders u/s. 201(1) and 201(1A) passed by the Assessing Officer, the aforesaid orders in the case of respective appeals are barred by limitation and hence, are liable to be set aside. The ld. AR submitted that as per provisions of section 201(3) as they were applicable to the assessment year under appeal the period of limitation for passing the orders u/s. 201(1) was two years from the end of financial year in which the statement is filed and six years from the end of financial year in which the payment is made or is credited. The case of assessee in all the appeals fails under sub-section 3(i) of section 201 of the Act.
On the other hand Shri A.K. Modi and Shri Rajesh Gawali representing the Department vehemently defended the impugned orders. The ld. DRs submitted that sufficient opportunity of hearing was afforded to the assessee by the Commissioner of Income Tax (Appeals) and the
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Assessing Officer. However, the assessee failed to produce relevant documents to support its contentions. The ld. DRs filed a chart indicating date of show cause notice, date of hearing as per show cause notice and the date of passing the orders u/s. 201(1) and 201(1A) of the Act, by the Assessing Officer. The ld. DRs further pointed that wherever the assessee had produced documentary evidence to show compliance of TDS provisions, the benefit of same has been granted to the assessee by the authorities below.
We have heard the submissions made by representative of rival sides and have examined the impugned orders. The impugned orders in all the appeals are identical. The chart giving the details of date of show cause notice, the date of hearing before Assessing Officer and the date of orders passed by the Assessing Officer reveal that from the date of issuance of show cause to the date of passing of orders u/s. 201(1) and 201(1A) of the Act is less than one month and in some of the cases it is barely two weeks. Undisputedly, the information sought by the Assessing Officer from the assessee is about six years old. It takes time to retrieve the old information. We find merit in the contentions of the ld. AR of assessee. The Commissioner of Income Tax (Appeals) has failed to appreciate the fact that to retrieve old information from voluminous physical data is a herculean task. We are of considered view that sufficient opportunity to produce relevant information/data was not afforded to the assessee. Taking into consideration entirety of facts, we deem it appropriate to restore all these appeals back to the file of Commissioner of Income Tax (Appeals) for de-novo adjudication, after affording reasonable opportunity of hearing to the assessee, in accordance with law.
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The ld. AR during the course of submissions has raised a legal ground challenging the validity of orders passed u/s. 201(1) and 201(1A) of the Act, on the ground of limitation. This ground was neither raised by assessee before the First Appellate Authority nor was raised before the Tribunal as additional ground of appeal. The assessee is at liberty to raise all legal issues before the First Appellate Authority, if so advised.
In the result, the impugned orders are set aside and all the appeals are allowed for statistical purpose in the terms aforesaid.
Order pronounced on Thursday, the 25th day of July, 2019.
Sd/- Sd/- (डी. करुणाकरा राव/D. Karunakara Rao) (ववकास अवस्थी / Vikas Awasthy) ऱेखा सदस्य / ACCOUNTANT MEMBER न्याययक सदस्य / JUDICIAL MEMBER ऩुणे / Pune; ददनाांक / Dated : 25th July, 2019. RK आदेश की प्रतिलिपि अग्रेपिि / Copy of the Order forwarded to : अऩीऱाथी / The Appellant. 1. प्रत्यथी / The Respondent. 2. आयकर आयुक्त (अऩीऱ) / The CIT(A) concerned 3. आयकर आयुक्त / The CIT concerned 4. ववभागीय प्रयतयनधध, आयकर अऩीऱीय अधधकरण, “ए” बेंच, 5. ऩुणे / DR, ITAT, “A” Bench, Pune. गाडड फ़ाइऱ / Guard File. 6. //सत्यावऩत प्रयत // True Copy// आदेशानुसार / BY ORDER,
यनजी सधचव / Private Secretary, आयकर अऩीऱीय अधधकरण, ऩुणे / ITAT, Pune