M/S MAHADEV STEET INDUSTRIES,MANDI GOBINDGARH vs. ITO, W-2, MANDI GOBINDGARH

आदेश/Order

Per Sanjay Garg, Judical Member:

The captioned Misc. Applications have been moved by the Department pleading that a mistake apparent on record has occurred in consolidated order dated 1.11.2018 of this Tribunal in dismissing the

M.A. Nos. 66 to 70-Chd/2019 in ITA Nos. 1354 & 1355-Chd-2012 & 774 to776-Chd-2013- M/s Punjab Infrastructure Development Board, Chandigarh 2 appeals of the Revenue bearing ITA Nos. 1354 & 1355/Chd/2012 and

ITA Nos. 774 to 776/Chd/2013 on the ground of tax involved being less

than the prescribed monetary limit of Rs. 20 lacs by the CBDT vide

Circular No. 3/2018 u/s 268 A of the Income Tax Act, 1961 (in short

'the Act').

before the Hon’ble Punjab & Haryana High Court against the common

order of the Tribunal dated 30.09.2015. That the matter in these appeals

were remanded by the Hon'ble Punjab & Haryana High Court vide

combined order dated 20.12.2016 to decide the limited / main issue as to

whether the assessee was liable for deduction of tax u/s 194C of the Act.

However, the substantial question of law framed by the Hon'ble High

Court as to ‘whether the assessee was liable to pay interest u/s 201(1A)

of the Act for non / late deduction of TDS’, has been answered in favour

of the Revenue and against the assessee. That the Tribunal vide

combined order dated 01.11.2018 has dismissed the appeals on the

ground that tax effect involved in these appeals was less than the

prescribed limit of Rs. 20 lacs as per CBDT Circular No. 3/2018,

without appreciating that the matter in these appeals was remanded

back by the Hon'ble High Court for adjudication on one of the two

issues involved. That the other issue involved has already been

adjudicated by the Hon'ble High Court in favour of the Revenue,

however, giving part relief to the assessee also, therefore, a mistake has

M.A. Nos. 66 to 70-Chd/2019 in ITA Nos. 1354 & 1355-Chd-2012 & 774 to776-Chd-2013- M/s Punjab Infrastructure Development Board, Chandigarh 3 occurred in the order of the Tribunal in dismissing the appeals on the

ground of tax effect involved as these appeals were not to be adjudicated

on the original grounds of appeal taken by the Revenue. That, moreover

the tax effect involved has been computed after the grant of part relief

to the assessee by the Hon'ble High Court and not on the basis of

original grounds of appeal of the Revenue.

Further, it has also been pleaded that a typographical error has

occurred in the header on the upper right side of the order, wherein, the

case name has been wrongly mentioned as “M/s Octamac Software Pvt

Ltd, Chandigarh” and the ITA has also been wrongly mentioned as ‘ITA

No.991/Chd/2017”. It has, therefore, been pleaded that the order

dismissing the appeals of the Revenue due to low tax effect be recalled

and the matter be adjudicated afresh.

the parties and have gone through the record. The brief facts of the case

are that the Assessing Officer vide orders passed u/s 201(1) / 201(1A)

of the Act held that the assessee was liable to deduct tax at source in

respect of certain payments made by it as per the provisions of section

194C of the Act and, accordingly, created the demand. He also created

demand of interest thereupon. However, since the assessee had failed to

do so, he, therefore, held the assessee in default u/s 201(1) & 201(1A)

M.A. Nos. 66 to 70-Chd/2019 in ITA Nos. 1354 & 1355-Chd-2012 & 774 to776-Chd-2013- M/s Punjab Infrastructure Development Board, Chandigarh 4 of the Act and created demand for non-deduction of TDS as well as

accrued interest thereupon.

created by the Assessing Officer were allowed by the CIT(A) vide

separate orders dated 13.10.2012 (in ITA 1354 & 1355/Chd/2012) and

01.4.2013 (in ITA Nos.774 to 776/Chd/2013) holding that the provisions

of section 194C were not applicable to the assessee’s case, therefore, the

assessee could not be said to be the assessee in default u/s 201 &

201(1A) of the Act. The Ld. CIT(A) did not adjudicate the alternative

issue raised by the assessee in the appeals that even assuming that the

assessee was liable to deduct tax at source u/s 194C of the Act, even

then it was not liable to pay interest u/s 201(1A) as the payees of the

amounts had filed their returns declaring nil income and, hence, no tax

in fact was payable by them. The Revenue preferred appeals against the

order of the CIT(A) before this Tribunal, however, this Tribunal vide

consolidated order dated 30.09.2015 dismissed the captioned appeals of

the Revenue but on the basis of the alternative contention of the

assessee that the assessee was not liable to pay interest u/s 201(1A) of

the Act as the payees of the amount had filed their returns showing nil

tax effect / losses.

preferred appeals before the Hon'ble High Court. The Hon'ble High

M.A. Nos. 66 to 70-Chd/2019 in ITA Nos. 1354 & 1355-Chd-2012 & 774 to776-Chd-2013- M/s Punjab Infrastructure Development Board, Chandigarh 5 Court while adjudicating the appeals bearing ITA Nos. 73, 72, 96, 75

and 74 relating to assessment years 2007-08 to 2011-12 respectively,

with the main order passed in ITA No. 73 of 2016 dated 20.12.2016,

decided the alternative issue in favour of the Revenue and against the

assessee holding that the assessee was liable to pay interest u/s 201

(1A) of the Act. However, the Hon'ble High Court remanded the matter

for adjunction on the other issue to ‘whether the assessee was liable to

deduct tax at source per the provisions of section 194C of the Act or

not?’.

The Hon'ble High Court therefore, reversed the order of the

Tribunal on the alternative contention of the assessee. Since the

Tribunal had only considered the assessee’s alternative contention and

did not adjudicate the main contention that the provisions of section

194C of the Act were applicable at all, the Hon'ble High Court remanded

the matter on this issue to the Tribunal. However, the Hon'ble High

Court gave categorical findings that the question of law framed by the

Hon'ble High Court in the appeals of the Revenue was answered in

favour of the Revenue and against the assessee and accordingly allowed

the appeals of the Revenue.

Against the order of the Hon'ble High Court, we have been told

that the assessee has already filed SLPs before the Hon'ble Supreme

Court. The matter in the captioned appeals, therefore, was remanded by

the Hon'ble High Court for deciding one of the two issues involved in

M.A. Nos. 66 to 70-Chd/2019 in ITA Nos. 1354 & 1355-Chd-2012 & 774 to776-Chd-2013- M/s Punjab Infrastructure Development Board, Chandigarh 6 these appeals and the other issue have already been considered and

decided by the Hon'ble High Court in favour of the Revenue, though the

assessee also getting some part relief therefrom.

In view of the above facts, we are of the view, that the mistake has

occurred in the order of the Tribunal in dismissing these appeals on the

ground of law tax effect involved. In fact, the appeals of the Revenue

had already been adjudicated by the Tribunal by order dated 30.09.2015

whereupon, the appeals were preferred to the Hon'ble High Court and

the Hon'ble High Court has already decided part of the issue.

The matter before the Tribunal was not for adjudication on all the

original grounds taken by the Revenue in these appeals, rather, the

Tribunal was directed by the Hon'ble High Court to adjudicate upon only

one of the two issues involved. The original order of the Tribunal dated

30.09.2015, therefore, merged with the orders of the Hon'ble High

Court. The dismissal because of the low tax effect could have been

done, if the entire matter would have been before the Tribunal as per

the ground raised by the Revenue against the order of the CIT(A).

However, this was not so. Even the Tribunal has taken into

consideration the tax effect involved after part relief granted by the

Hon'ble High Court to the assessee. Under the circumstances, the

dismissal of the appeals taking into consideration the tax effect

involved after the adjudication given by the Hon'ble High Court and

M.A. Nos. 66 to 70-Chd/2019 in ITA Nos. 1354 & 1355-Chd-2012 & 774 to776-Chd-2013- M/s Punjab Infrastructure Development Board, Chandigarh 7 considering the relief granted by the Hon'ble High Court was not

correct and, therefore, a mistake has occurred in dismissing these

appeals of the Revenue on the ground of low tax effect without

appreciating the true facts of the case. These are not the cases where the

entire matter had been set aside by the Hon'ble High Court for decision

afresh, rather, in these cases, the matter had been remanded back to the

Tribunal for adjudicating upon on the issue that was left un-adjudicated

by the Tribunal while deciding the appeals of the Revenue vide order

dated 30.9.2015.

In view of this, the order dated 1.11.2018 is recalled and the

appeals are restored to be registered at their original number.

of the assessee relating to the same matter have already been decided by

the Tribunal against the assessee and in favour of the Revenue,

therefore, since the issue in the main appeals is covered against the

assessee vide order dated 29.03.2019 of this Tribunal passed in ITA

Nos. 880 & 881/Chd/2013 & Ors, therefore, the main appeals may be

accordingly disposed off.

We, however, are of the view that the assessee should be given an

opportunity of hearing on the main appeals of the Revenue for the sake

M.A. Nos. 66 to 70-Chd/2019 in ITA Nos. 1354 & 1355-Chd-2012 & 774 to776-Chd-2013- M/s Punjab Infrastructure Development Board, Chandigarh 8

of principle of natural justice. We, therefore, direct the registry to fix the main appeals as early as possible.

Order pronounced in the Open Court on 04.10.2019.

Sd/- Sd/- ( बी , आर . आर . कुमार / B.R.R. KUMAR) (संजय गग� / SANJAY GARG ) लेखा सद�य/ Accountant Member �या�यक सद�य /Judicial Member

Dated : 04.10.2019 “आर.के.” आदेश क� ��त�ल�प अ�े�षत/ Copy of the order forwarded to : 1. अपीलाथ�/ The Appellant 2. ��यथ�/ The Respondent 3. आयकर आयु�त/ CIT 4. आयकर आयु�त (अपील)/ The CIT(A) 5. �वभागीय ��त�न�ध, आयकर अपील�य आ�धकरण, च�डीगढ़/ DR, ITAT, CHANDIGARH 6. गाड� फाईल/ Guard File आदेशानुसार/ By order,

M.A. Nos. 66 to 70-Chd/2019 in ITA Nos. 1354 & 1355-Chd-2012 & 774 to776-Chd-2013- M/s Punjab Infrastructure Development Board, Chandigarh

सहायक पंजीकार/ Assistant Registrar