M/S. RUKMANI INFRA PROJECTS PVT. LTD.,BHUBANESWAR vs. ACIT, TDS-1, BHUBANESWAR

Brief facts of the case are that the assessee is engaged in the business of infrastructure projects and the AO has passed order u/s.201(1)/201(1A) of the Act on 19.12.2013 raising a demand for non-deduction of TDS Rs.10,89,370/- including interest u/s.201(1A) of the Act of Rs.2,43,473/-. The demand has arisen in respect of non-deduction of TDS of 2 contractual amount u/s.194A of the Act. Subsequently the AO has issued notice for initiation of penalty. Since there is no compliance on the part of the assessee and the AO based on the availability of information on record found that the assessee could not explain the details for non-deduction of TDS, therefore levied penalty and passed the order u/s.271(1)(c) of the Act dated 27.8.2014. 4. On appeal, the CIT(A) has confirmed the findings of AO and dismissed the appeal of the assessee.

At the time of hearing, none appeared on behalf of the assessee when the matter was called for hearing nor any adjournment application was placed on record, thus, the bench proceeded to dispose off the appeal on the basis of material available on record and on the submissions of ld. DR.

We have heard submissions of ld. DR and considered the materials available on record. The only disputed issue is in respect of levy of penalty by the AO for non-deduction of TDS on interest payments to NBFCs whereas the assessee has made the payments by way of EMI and post dated cheques(PDC). The contention of the assessee that a recipient has already offered income in their Income Tax Returns and assessee is not required to deduct TDS and relied on the decision of the Hon’ble Supreme Court in the case of Hindustan Coca Cola Beverages AO raised demand u/s.201(1)/201(1A) of the Act aggregating to Rs.10,89,370/- and also penalty was also levied. We found that for the earlier assessment year 2011-2012 and subsequent assessment year 2013-2014, the Hon’ble Tribunal has remitted the matter to the file of AO for verification whether the recipient has offered this income in their assessments and certificate from CA has been submitted. Similarly in this present assessment year we are of the opinion if in the quantum appeal for assessment year 2012- 2013 the assessee has produced the income tax particulars and the details of interest income has been offered by the recipient in its assessment the AO may consider the same in the penalty proceedings. Accordingly, we remit the penalty appeal to the file of AO and the assessee is directed to submit the information of recipient of interest income and AO shall decide the case afresh after giving proper and reasonable opportunity of being heard to the assessee. Accordingly, the grounds of appeal of the assessee are allowed for statistical purposes.

In the result, appeal of the assessee is allowed for statistical purposes. Order pronounced in the open court on this 04/04/2018. (N. S. SAINI) (PAVAN KUMAR GADALE) ऱेखा सदस्य / ACCOUNTANT MEMBER न्यानयक सदस्य / JUDICIAL MEMBER कटक Cuttack; ददनांक Dated 04/04/2018 प्र.कु.मि/PKM, Senior Private Secretary