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Income Tax Appellate Tribunal, MUMBAI BENCH “B”, MUMBAI
Before: SHRI C.N. PRASAD, HONBLE & SHRI RAJESH KUMAR, HONBLEShri D.Y. Pandit
IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH “B”, MUMBAI BEFORE SHRI C.N. PRASAD, HON'BLE JUDICIAL MEMBER AND SHRI RAJESH KUMAR, HON'BLE ACCOUNTANT MEMBER ITA NO. 4610/MUM/2018 (A.Y: 2011-12) M/s Blue Star Construction Co. v. Addl. Commissioner of Income-tax Near Shankar Mandir Tax TDS Raigad, Thane Opp. Shirke Plant SH-54 Uran Panvel Road Tal., Uran Raigad – 400 702, Thane PAN: AAFFB3087E (Appellant) (Respondent) Assessee by : Shri D.Y. Pandit Department by : Ms. Kavita P.Kaushik
Date of Hearing : 16.10.2019 Date of Pronouncement : 13.12.2019
O R D E R PER C.N. PRASAD (JM)
This appeal is filed by the assessee against the order of the Learned Commissioner of Income Tax (Appeals) – 3, Nasik (Camp Office –Thane) [hereinafter in short “Ld.CIT(A)”] dated 20.03.2018 for the A.Y. 2011-12.
Assessee in its appeal raised the following grounds: 1) The learned CIT (A)-3 Nasik failed to take cognizance of the facts that assessee did not receive the any notices issued on under Sec 272 (1) K by Dy. CIT as stated by him in his order u/s.272(A)(2)(k) of the Act and also assessee did not receive even
2 ITA NO. 4610/MUM/2018 (A.Y: 2011-12) M/s Blue Star Construction Co. the order dt. 05-02-2013 passed by DY. CIT u/s. 272(A)(2)k of the Act. 2) The CIT (A)-3 Nasik on merits should have appreciated the fact that with effect from 1st duly 2012, as stated in 2nd proviso to Sec 272 A(2) which is as follows Provided further that no penalty shall be levied under this Section for the failure referred to in clause(k) if such failure related to a statement referred to in sub Sec.(3) of the Sec 200 or the proviso to sub Sec (3) of Sec 206C which is to be delivered or caused to be delivered for tax deducted at source or tax collected at source as the case may be, on or after the 1st day of July 2012" and penalty is levied u/s (3) of Sec 200 of the Act and thus said penalty order is bad in law. 3) The notices of hearing sent from office of CIT (A)-3 Nasik fixing the hearing date are not sent on address mentioned in form 35 of the Act. Hence, the appeal orders dt. 20-03-2018 bad in law.”
At the outset, Learned Counsel for the assessee submitted that, assessee has neither received the notice issued u/s. 272A(2)(K) of the Act requiring the assessee to show cause as to why the order imposing penalty u/s. 272A(2)(K) of the Act should not be passed. It was also further submitted by the Ld. Counsel for the assessee that even the order dated 05.02.2013 passed by the Additional Commissioner of Income-tax, imposing penalty u/s. 272A(2)(K) was not served on the assessee.
Ld. Counsel for the assessee further submitted that as per the second proviso to section 272A which was inserted by the Finance Act, 2012 w.e.f. 01.07.2012 no penalty shall be levied under Section 272A on or after the 01st day of July, 2012, for failure to furnishing statements referred to in sub-section (3) of section 200 or sub-section (3) of section 206C of the Act. Ld. Counsel for the assessee submits that the Ld.CIT(A)
3 ITA NO. 4610/MUM/2018 (A.Y: 2011-12) M/s Blue Star Construction Co. ignoring the second proviso to section 272A sustained the penalty observing that even prior to amendment provision of section 272A is in the statute.
Ld. DR strongly supported the orders of the Ld.CIT(A).
We have heard the rival submissions, perused the orders of the authorities below. The Additional Commissioner of Income-tax, passed an order u/s.272A(A)(K) of the Act on 05.02.2013 levying penalty of ₹.2,36,800/- for delay in filing Form No. 26Q i.e. quarterly statements of TDS u/s. 200(3) of the Act. On appeal the Ld.CIT(A) sustained the penalty without appreciating the submissions of the assessee. Before us, it is the submission of the Ld. Counsel for the assessee that no penalty is leviable under section 272A of the Act on or after 01st day of July, 2012 for the failure to furnish the statements referred to in sub section (3) of section 200 of the Act. We have perused the provisions of section 272A and the second proviso therein which reads as under: - “Provided further that no penalty shall be levied under this section for the failure referred to in clause (K), if such failure relates to a statement referred to in sub-Section (3) of section 200 or the proviso to sub-section (3) of section 206C which is to be delivered or caused to be delivered for tax deducted at source or tax collected at source, as the case may be, on or after the 1st day of July, 2012.”
The above second proviso to section 272A was inserted by the Finance Act, 2012 w.e.f. 01.07.2012. On a plain reading of the proviso it
4 ITA NO. 4610/MUM/2018 (A.Y: 2011-12) M/s Blue Star Construction Co. is abundantly clear that no penalty shall be levied under Section 272A of the Act on or after 01st day of July, 2012 for the failure referred to in clause (k) i.e. in respect of furnishing of copy of statements within the time specified in sub-section (3) of section 200 of the Act for non-deduction of TDS. However, in this case order imposing penalty u/s. 272A(2)(K) of the Act was passed on 05.12.2013 making the penalty order null and void as it was passed after insertion of the second proviso to section 272A of the Act. Thus we set-aside the penalty order passed u/s. 272A(2)(K) of the Act and direct the Assessing Officer to delete the penalty.
In the result, appeal of the assessee is allowed.
Order pronounced in the open court on the 13th December, 2019
Sd/- Sd/- (RAJESH KUMAR) (C.N. PRASAD) ACCOUNTANT MEMBER JUDICIAL MEMBER Mumbai / Dated 13/12/2019 Giridhar, Sr.PS Copy of the Order forwarded to: 1. The Appellant 2. The Respondent. 3. The CIT(A), Mumbai. 4. CIT 5. DR, ITAT, Mumbai 6. Guard file. //True Copy// BY ORDER (Asstt. Registrar) ITAT, Mum