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Income Tax Appellate Tribunal, PATNA BENCH, PATNA
IN THE INCOME TAX APPELLATE TRIBUNAL PATNA BENCH, PATNA Before Sh. N. K. Saini, AM and Sh. Amit Shukla, JM ITA No. 133/Pat./2010 : Asstt. Year : 2008-09 Syndicate Bank, Vs Asstt. Commissioner of Income Tax, Fraser Road, TDS Circle, Patna-800001 Patna (APPELLANT) (RESPONDENT) PAN No. PTNS01245G Assessee by : Sh. A. K. Sarkar & Sh. Abhi Sarkar, Adv. Revenue by : Sh. Abhay Kumar, Sr. DR Date of Hearing : 08.03.2018 Date of Pronouncement : 08.03.2018 ORDER Per N. K. Saini, AM: This is an appeal by the assessee against the order dated 05.04.2010 of ld. CIT(A), Dhanbad, Camp Office Patna.
The only grievance of the assessee in this appeal relates to the upholding the interest of Rs.3,24,381/- charged by the AO u/s 201(1A) of the Income Tax Act, 1961 (hereinafter referred to as the Act).
Facts of the case in brief are that a survey u/s 133A of the Act was conducted on 28.11.2008 in the premises of the assessee and TDS on salary, FDRs/TDRs, rent and generator charges was test checked. The AO observed that it was statutory duty of the bank to deduct the TDS at the time of crediting the same and deposit it to the Central Government Account within 7 days of the following months which the assessee failed. The AO worked out the total amount of interest
2 ITA No. 133/Pat./2010 Syndicate Bank credited at Rs.56,30,490.90 on which TDS payable was at Rs.11,59,881/- and the interest u/s 201(1A) of the Act was worked out at Rs.3,24,381/-. The AO considered the assessee in default for the aforesaid sum of Rs.14,84,262/-. 4. Being aggrieved the assessee carried the matter to the ld. CIT(A) who held that there was no justification for treating the assessee in default in respect of the TDS of Rs.11,59,881/-. However, he confirmed the interest of Rs.3,24,381 u/s 201(1A) of the Act by observing in para 4 of the impugned order as under: “4. I have examined the facts of the case and also considered the appellant’s submission. The failure to deduct tax at source has not been denied by the appellant. But at the same time it is apparent from the documents placed on record that the interest in respect of which the default was committed had been remitted to the investors viz. M/s B.R.P.N.N. Ltd. on 12th February, 2008 and 27th May, 2008. Since, M/s B.R.P.N.N. Ltd. have confirmed having accounted for the interest in its books, there is no longer any justification for continuing to treat the appellant as an assessee in default in respect of the TDS of Rs.11,59,881/-. It has been held by the Hon’ble Supreme Court in the case of Hindustan Cocacola Beverage Pvt. Ltd. Vs CIT 163 Taxman 355 that there could be no recovery of taxes alleged to be in default once again from the deductor if the deductee had already paid taxes on the amount received. Therefore, the demand raised by the AO u/s 201(1) is deleted. However, the appellant cannot escape the penal consequence for the failure to deduct tax at source in due course. Therefore, the levy of interest amounting to Rs.3,24,381/- u/s 201(1A) is upheld.” 5. Now the assessee is in appeal. The ld. Counsel for the assessee submitted that the tax of Rs.11,59,881/- u/s 201(1A) of the Act was deleted by the ld. CIT(A) on the basis of the judgment of the Hon’ble Apex Court in the case of Hindustan Cocacola Beverage Pvt. Ltd. Vs CIT reported in 293 ITR 226. It was
3 ITA No. 133/Pat./2010 Syndicate Bank further stated that no interest u/s 201(1A) of the Act was chargeable, if the tax was duly paid and that too at the time when it had become due. The reliance was placed on the judgment of the Hon’ble Gujarat High Court in the case of CIT Vs Rishikesh Apartments Co-op. Housing Society Ltd. reported at 253 ITR 310.
In his rival submissions, the ld. Sr. DR supported the orders of the authorities below.
We have considered the submissions of both the parties and carefully gone through the material available on the record. In the present case, the main contention of the ld. Counsel for the assessee was that the deductee has already paid the tax and this fact was not considered by the AO while charging the interest u/s 201(1A) of the Act. In the present case, it appears that the relevant documents relating to the payment of taxes by deductees were not furnished before the AO or the ld. CIT(A). We, therefore, deem it appropriate to set aside the limited issue to the file of the AO to be decided afresh in accordance with law after considering the documents, if any, furnished by the assessee in support of its claim that the deductees had already paid the tax, therefore, interest u/s 201(1A) of the Act cannot be charged. The AO is also directed to consider the judgment of the Gujarat High Court relied by the ld. Counsel for the assessee in the case of CIT Vs Rishikesh Apartments Co-op. Housing Society Ltd. (supra), if applicable in view of proviso to Section 201(1A) of the Act. 8. In the result, the appeal of the assessee is allowed for statistical purposes. (Order Pronounced in the Court on 08/03/2018)
Sd/- Sd/- (Amit Shukla) (N. K. Saini) JUDICIAL MEMBER ACCOUNTANT MEMBER Dated: 08/03/2018 *Subodh*