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Income Tax Appellate Tribunal, ‘’ D” BENCH, AHMEDABAD
Before: MS SUCHITRA KAMBLE & SHRI WASEEM AHMED
आदेश/O R D E R
PER WASEEM AHMED, ACCOUNTANT MEMBER:
The captioned appeal has been filed at the instance of the Assessee against the order of the Learned Commissioner of Income Tax (Appeals)-5, Ahmedabad, dated 27/05/2019 arising in the matter of assessment order passed under s. 143(3) of the Income Tax Act, 1961 (here-in-after referred to as "the Act") relevant to the Assessment Year 2009-2010.
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The assessee has raised the following grounds of appeal:
The learned AO has erred in computing the total income that of Rs. 70,12,080/- as against that of income returned Rs 62,22,420/-by making addition on account of disallowance u/s 40(a)(ia) of Rs. 7,89,655/-. 2. In law and in fact and circumstances of the appellant’s case, the learned AO has grossly erred in charging interest under section 234A/B/C/D of the Income Tax Act, 1961. 3. The learned AO is not justified in initiating penalty proceedings under section 271(1)(c) of The Income Tax Act, 1961 with respect to above addition. 4. That the appellant pray to stay demand of Rs. 1,27,370/- made by learned AO for the year under consideration. 5. The appellant has preferred appeal to the CIT (A) against the order of ACT. The learned CIT (A) dismissed the appeal on ground of late filing of appeal. The appellant has preferred further appeal to the ITAT for the above mentioned grounds.
The only issue raised by the assessee is that the Ld. CIT(A) erred in confirming the order of the AO by sustaining the disallowance of Rs. 7,89,655/- on account of non-deduction of TDS u/s 40(a)(ia) of the Act.
When the matter was called out for hearing none appeared on behalf of the assessee despite the fact that the notice intimating the date of hearing was duly served upon the assessee. Thus, in the absence of any reply, we decided to proceed to adjudicate the issue on hand ex-parte to the assessee.
At the outset we note that, there was delay in filing the appeal before the Ld. CIT(A) for 108 days. The assessee before the Ld. CIT(A) explained the delay in filing the appeal by stating that it has not received the assessment order dated 18/10/2018. According to the assessee, it came to know about the Assessment Order on receiving the demand notice dated 28/10/2019. Thereafter, the assessee preferred the appeal immediately dated 15/03/2019. Thus, the assessee requested the Ld. CIT(A) to condone the delay.
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However, the Ld. CIT(A) rejected the condonation petition filed by the assessee on the reasoning that as per the Assessment record the order was received by the assessee dated 29/10/2018. Thus, there was a delay in filing the appeal which has not been explained based on the documentary evidence. Thus, the Ld. CIT(A) has dismissed the appeal filed by the assessee in limine.
We have heard the Ld. DR and perused the materials available on record. From the preceding discussion, we note that it is the second round of appeal before us. The ITAT before us on the earlier occasion in ITA No.1920/Ahd/2013 dated 27/12/2016 for A.Y. 2009-10 restored the issue to the file of the AO for further verification. The relevant extract of the order is reproduced as under: "........ We have given out thoughtful consideration to rival submissions. It appears that there is no dispute about above legal position so far as retrospective operation of Section 40(a)(ia) (2nd proviso) hereinabove is concerned that the same does not apply in the case the assessee is not an assessee in default u/s.201(1) (lsl proviso). We however notice that this assessee's contention requires to be verified since it is not clear as to whether its payees stand assessed qua the impugned expenses/reimbursement or not. We thus restore the instant issue back to the file of Assessing Officer to conduct further verification after affording the assessee adequate opportunity of hearing who shall also be at liberty to place on record all of its evidence proving the impugned payments to be reimbursements of its expenses as undertaken by the payee agents.
7.1 On perusal of the above direction it has revealed that the AO was directed to conduct further verification so as to find out whether the recipient/payees has included receipt from the assessee in its books of accounts and such receipt has suffered to tax. However, we find that neither the assessee has furnished the necessary documents in compliance to the direction of the ITAT nor the AO has conducted any enquiry from the payees whether the payees has suffered to tax on the amount of income received from the assessee. However, the AO was pleased to confirmed the addition again in the hand of the assessee on account of non- deduction of TDS
7.2 Admittedly, the onus lies upon the assessee to furnish the necessary details in support of his contention that the payees have suffered to tax on the income received from the assessee. Nevertheless, it has been seen that on many occasion
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the payees do not co-operate with the assessee by giving necessary documents to the assessee. In such a situation, the assessee becomes helpless in providing the requisite information. However, there is enough power available to the revenue to collect the necessary details by issuing notice u/s 133(6)/131 of the Act but we note that the income tax authority have not exercised such power. As regard to condonation of delay, undoubtedly the assessee should be vigilant enough in perusing the income tax litigation. But if the appeal of the assessee is dismissed in limine without adjudicating the same on merit particularly in a situation where the justice could have been served to the assessee by the revenue after collecting the necessary information from the payees. Thus, the punishment given to the assessee by disallowing the expenses is not commensurate to the mistake committed by the assessee. Thus, in such facts and circumstances we are of the view that the Ld. CIT(A) could have condoned the delay in filing the appeal by the assessee
7.3 In view of the above and after considering the facts in totality and in the interest of justice and fair play, we are inclined to give one more opportunity to the assessee to furnish the necessary details before the AO. It is not out of place to mention that the AO can also enquire from the payees about the income received from the assessee whether the same was suffered to tax or not. Thus the ground of appeal of the assessee is allowed for the statistical purposes.
In the result, the appeal filed by the assesse is allowed for the statistical purposes.
Order pronounced in the Court on 10/10/2022 at Ahmedabad.
Sd/- Sd/- (SUCHITRA KAMBLE) (WASEEM AHMED) JUDICIAL MEMBER ACCOUNTANT MEMBER (True Copy) Ahmedabad; Dated 10/10/2022 Manish