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Facts
The revenue filed an appeal against the order of the CIT(A) for the assessment year 2016-2017. The Assessing Officer disallowed transport payments on the grounds that the assessee had not produced requisite forms before the authorities within the prescribed time. The assessee, a transport contractor, claimed to have collected details from vehicle operators as required under Section 194C(6) of the Act.
Held
The Tribunal held that the provisions of Section 194C(6) are independent of Section 194C(7) of the Act. As the assessee complied with the provisions of Section 194C(6) by obtaining and producing the forms, the disallowance under Section 40(a)(ia) was not justified.
Key Issues
Whether disallowance under Section 40(a)(ia) is warranted when the assessee has complied with Section 194C(6) of the Act, even if Section 194C(7) requirements were not met within the prescribed time.
Sections Cited
194C(6), 194C(7), 40(a)(ia)
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Income Tax Appellate Tribunal, CUTTACK BENCH CUTTACK
Before: SHRI GEORGE MATHAN & SHRI RAJESH KUMAR
O R D E R Per Bench : This is an appeal filed by the revenue against the order of the ld. CIT(A), National Faceless Appeal Centre (NFAC), Delhi, dated 30.08.2024, passed in ITBA/APL/S/250/2024-25/1068162509(1) for the assessment year 2016-2017.
Shri K.K.Bajoria, FCA appeared on behalf of the assessee. Shri Sanjay Kumar, ld CIT DR represented on behalf of the revenue.
It was submitted by ld CIT DR that the assessee is a transport contractor. It was the submission that the assessee had collected the requisite details from the vehicle operators as required u/s.194C(6) of the Act. It was the submission that the Assessing Officer disallowed the transport payments on the ground that the assessee had not produced the said forms before the concerned authorities in the time prescribed 2 under the Act as provided in Section 194C(7) of the Act. It was the submission that the forms were available before the Assessing Officer as also before the ld CIT(A) and the ld CIT(A) after considering the fact that the forms were available as required under section 194C(6) of the Act, relied upon the decision of the Co-ordinate Bench of Kolkata Bench in the case of Soma Rani Ghosh Vs. DCIT, passed in and the decision of the ITAT Hyderabad Bench of the Tribunal in the case of Mr. Mohammed Suhail in ITA No.1536/Hyd/2014, to hold that the provisions of section 194C(6) of the Act are independent of the provisions of section 194C(7) of the Act and once the requisite forms u/s.194C(6) have been obtained and the same are produced before the Assessing Officer, no disallowance u/s.40(a)(ia) of the Act is called for. It was the submission of the ld. CIT-DR that the provisions of Section 194(C)(6) & 194(C)(7) of the Act are interdependent and the requirement of filing the form before the authorities below was a statutory requirement. It was the submission that the order of the ld.CIT(A) is liable to be reversed.
In reply, ld AR submitted that the ld CIT(A) has followed the judicial discipline in following the decisions of both the co-ordinate Benches of the Tribunal i.e the decision of Kolkata Benches in the case of Soma Rani Ghosh(supra) and Hyderabad Benches in the case of Mr. Mohammed Suhail (spra). It was the submission that as the ld CIT(A) has followed the judicial discipline, no interference in the order of the ld CIT(A) is called for.
We have considered the rival submissions. A perusal of the order of the ld CIT(A) in para 4.6 of his order clearly shows that the ld CIT(A)
3 has followed the judicial discipline in following the decisions of ITAT Kolkata Benches in the case of Soma Rani Ghosh(supra) and ITAT Hyderabad Benches in the case of Mohd Suhail (supra). wherein, the coordinate benches of the Tribunal have clearly taken a view that the provisions of section 194C(6) of the Act are independent of section 194C(7) of the Act and just because there is violation of provisions of section 194C(7) of the Act, the disallowance u/s.40(a)(ia) of the Act does not arise, if the assessee complies the provisions of section 194C(6) of the Act.
Further, a perusal of order of ld CIT(A) in para 4.7 clearly shows that the ld CIT(A) has categorically admitted that the Assessing Officer has clearly recorded that the declaration of the vehicle owners have been submitted. Thus, there is no dispute to the fact as allegation made by the ld. CIT-DR in regard to the compliance of provisions of section 194C(6) of the Act. This being so, as it is noticed that the ld CIT(A) has followed the judicial discipline in following the decisions of the Co-ordinate Benches of the Tribunal and the revenue has not been able to point out any error in the findings of facts arrived at by the ld CIT(A), we find no reason to interfere with the order of the ld CIT(A). Accordingly, we uphold the order of the ld CIT(A) and dismiss the grounds of appeal of the revenue.