SHRI GOVERDHAN PRASAD SINGHAL,JAIPUR vs. ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE-6, JAIPUR

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ITA 742/JPR/2017Status: DisposedITAT Jaipur13 December 2017AY 2013-143 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal found that the matter required a fresh look at the Assessing Officer's level. The issue was restored to the AO to decide as per law after providing an adequate opportunity to the assessee.

What were the facts?

The assessee made a payment of interest to an NBFC without deducting TDS. The Assessing Officer upheld the addition of this amount under Section 40(a)(ia) of the Income Tax Act. The assessee contended that the second proviso to Section 40(a)(ia) should apply.

What were the issues?

Whether disallowance under Section 40(a)(ia) is applicable when the assessee claims the benefit of the second proviso, and if the matter should be remanded for further verification of compliance with conditions.

Which sections of the Income-tax Act were involved?

Section 40(a)(ia)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, JAIPUR BENCHES (SMC

Before: SHRI BHAGCHANDvk;dj vihy la-@ITA No. 742/JP/2017

For Appellant: Shri Shambhu Lal Gupta (CA) jktLo dh vksj ls@
Hearing: 13/12/2017Pronounced: 14/12/2017

आयकर अपीलीय अधिकरण] जयपुर न्यायपीठ] जयपुर IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES (SMC), JAIPUR Jh Hkkxpan] ys[kk lnL;] ds le{k BEFORE: SHRI BHAGCHAND, ACCOUNTANT MEMBER vk;dj vihy la-@ITA No. 742/JP/2017 fu/kZkj.k o"kZ@Assessment Year : 2013-14 cuke Goverdhan Prasad Singhal, A.C.I.T., Vs. CC-229, Gole Market, Circle-6, Jawahar Nagar, Jaipur. Jaipur. PAN No.: ACVPS 0236 P vihykFkhZ@Appellant izR;FkhZ@Respondent fu/kZkfjrh dh vksj ls@ Assessee by : Shri Shambhu Lal Gupta (CA) jktLo dh vksj ls@ Revenue by : Smt. Poonam Roy (DCIT) lquokbZ dh rkjh[k@ Date of Hearing : 13/12/2017 mn?kks"k.kk dh rkjh[k@ Date of Pronouncement : 14/12/2017 vkns'k@ ORDER

PER: BHAGCHAND, A.M.

This is an appeal filed by the assessee emanates from the order of

ld. CIT(A)-2, Jaipur dated 23/08/2017 for the A.Y. 2013-14, wherein the

assessee has raised sole effective ground of appeal, which is as under:-

“1. That on the facts and circumstances of the case, the ld CIT(A) wrong, unjust and erred in law in upholding the addition of Rs. 4,95,351/- U/s 40(a)(ia) of the Income Tax Act on account of non deduction of TDS on interest to NBFC ignoring the fact that the installment for interest with principle has been paid in advance by post dated cheque. The ld. CIT(A) is further wrong, unjust and erred in law ignoring the second proviso to section 40(a)(ia).

ITA 742/JP/2017_ 2 Goverdhan Pd. Singhal Vs ACIT 2. The only issue involved in the appeal is sustaining the addition of

Rs. 4,95,351/- made U/s 40(a)(ia) of the Income Tax Act, 1961 (in short

the Act) for non deduction of TDS on interest to NBFC. The assessee has

paid interest of Rs. 4,95,351/- to the NBFC namely Tata Capital House

Finance. The assessee has made payment without deducting TDS. The

assessee took a plea that as per second proviso to Section 40(a)(ia) of the

Act, no disallowance can be made. The Assessing Officer did not accept the

contention of the assessee for the reason that second proviso to Section

40(a)(ia) of the Act referred to Section 201 of the Act. As per provisions of

sub-section (1) of Section 201, the assessee who has not deducted TDS on

the payments has to fulfill certain specific conditions and one of them is

furnishing certificate from an accountant in Form 26A as per Rule 31ACB

by the payee. The ld AR of the assessee submitted that such certificate

could not be obtained but now the assessee has obtained such certificate

and if the matter restored back to the file of the Assessing Officer, this will

be submitted before the Assessing Officer for verification. He has also

drawn our attention that the ld. CIT(A) has mentioned that amendment has

been specifically provided to be effective from certain date and the

amendment was not in force during the year under consideration, which is

factually incorrect.

ITA 742/JP/2017_ 3 Goverdhan Pd. Singhal Vs ACIT 3. On the other hand, the ld DR has relied on the orders of the

authorities below.

4.

Bench have heard both the sides on this issue. Bench is of the view

that in the interest of justice and equity, this matter needs a fresh look at

the level of the Assessing Officer. The issue is restored to the A.O. to be

decided as per law after providing effective and adequate opportunity of

being heard to the assessee. The assessee shall submit necessary

documents before the Assessing Officer. Hence, the matter is restored back

to the file of the Assessing Officer.

5.

In the result, the appeal of the assessee is allowed for statistical

purposes only. Order pronounced in the open court on 14/12/2017.

Sd/- ¼Hkkxpan½ (BHAGCHAND) ys[kk lnL;@Accountant Member Tk;iqj@Jaipur fnukad@Dated:- 14th December, 2017 *Ranjan आदेश की प्रतिलिपि अग्रेf’ात@ब्वचल वf जीम वतकमत वितूंतकमक जवरू vihykFkhZ@The Appellant- Shri Goverdhan Prasad Singhal, Jaipur. 1. izR;FkhZ@ The Respondent- The A.C.I.T., Circle-6, Jaipur. 2. vk;dj vk;qDr@ CIT 3. vk;dj vk;qDr¼vihy½@The CIT(A) 4. विभागीय प्रतिनिधि] आयकर अपीलीय अधिकरण] जयपुर@क्त्ए प्ज्Aज्ए Jंपचनत 5. xkMZ QkbZy@ Guard File (ITA No. 742/JP/2017) 6. vkns'kkuqlkj@ By order, सहायक पंजीकार@Aेेज. त्महपेजतंत

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