M/S PRAKASH TRADING CO.,NOIDA vs. DCIT (TDS), NOIDA

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ITA 4365/DEL/2016Status: DisposedITAT Delhi29 September 2017AY 2012-136 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal found that the CIT(A) passed the orders mechanically without providing an opportunity to be heard to the assessee, violating principles of natural justice. Therefore, the impugned orders were set aside.

What were the facts?

The Assessing Officer treated the assessee in default for failing to deduct TDS on payments made to a transport operator. The assessee argued that Section 194C(6) was applicable, but the AO disagreed. The CIT(A) dismissed the appeals.

What were the issues?

Whether the CIT(A) erred by adjudicating on issues not subject to appeal and by not providing an opportunity of being heard to the assessee.

Which sections of the Income-tax Act were involved?

Section 194C,Section 201(1),Section 201(1A)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH ‘F’ : NEW DELHI

Before: SHRI N.K. SAINI & SHRI KULDIP SINGH

For Appellant: Shri G.C. Srivastava, Advocate
For Respondent: Shri Deepak Garg, Senior DR
Hearing: 27.09.2017

PER KULDIP SINGH, JUDICIAL MEMBER : Since common question of law and facts is involved in all the aforesaid appeals filed by the assessee against order dated 30.05.2016 passed by the ld. CIT (A)-I, Noida, the same are being disposed off by way of consolidated order to avoid repetition of discussion.

2.

Appellant, M/s. Raj Associates (hereinafter referred to as ‘the assessee’), by filing the present appeals being & 4364/Del/2016 sought to set aside the impugned order dated 30.05.2016 passed by the Commissioner of Income-tax (Appeals)-I, Noida, for the Assessment Years 2012-13 & 2013-14 on the similar grounds inter alia that :-

ITA NO.4363/DEL/2016 (AY 2012-13)

ITA NO.4364/DEL/2016 (AY 2012-13)

1.

““1. The learned Commissioner of Income-tax (Appeals)-l, Noida has erred in law as well as on facts by treating the assessee in default under section 201(1) & 201(lA) of the I.T. Act, 1961, by invoking section 194C(7) of the LT. Act, 1961.

2. The learned Commissioner of Income-tax (Appeals)-l, Noida has erred in law as well as on facts by adjudicating on the issue which was not the subject matter of the appeal, without providing any opportunity to the assessee.

3. Any other ground of appeal, which may be taken up during the course of appellate proceedings.

4. The appellant craves leave to add, alter, amend, raise or delete any or all grounds of appeal.”

3. Appellant, M/s. Prakash Trading Co. (hereinafter referred to as ‘the assessee’), by filing the present appeals being & 4365/Del/2016 sought to set aside the impugned order dated 30.05.2016 passed by the Commissioner of Income-tax (Appeals)-I, Noida, for the Assessment Years 2012-13 & 2013-14 on the similar grounds inter alia that :-

ITA NO.4366/DEL/2016 (AY 2013-14)

“1. The learned Commissioner of Income-tax (Appeals)-l, Noida has erred in law as well as on facts by treating the assessee in default under section 201(1) & 201(lA) of the I.T. Act, 1961, by invoking section 194C(7) of the LT. Act, 1961.

2. The learned Commissioner of Income-tax (Appeals)-l, Noida has erred in law as well as on facts by adjudicating on the issue which was not the subject matter of the appeal, without providing any opportunity to the assessee.

3.

Any other ground of appeal, which may be taken up during the course of appellate proceedings.

4. The appellant craves leave to add, alter, amend, raise or delete any or all grounds of appeal.”

3. Briefly stated the facts necessary for adjudication of the controversy at hand in all the aforesaid appeals are : Assessing Officer noticed that the assessee has failed to comply with the provisions contained u/s 194C of the Income-tax Act, 1961 (for short ‘the Act’) by deducting TDS qua the payments made by the assessee to the transport operator in Assessment Years 2012-13 and 2013-14. Being not satisfied with the explanation furnished by the assessee, the AO proceeded to hold that since the assessee is not in the business of plying, hiring or leasing goods carrier, the provisions contained u/s 194C (6) are not applicable to the assessee who was liable to deduct the tax u/s 194C of the Act. AO found the assessee as assessee in default u/s 201(1) and 201(1A) of the Act and thereby fixed the total tax liability of the assessee at Rs.90,896/- & Rs.15,096/- for AYs 2012-13 & 2013-14 respectively in case of M/s. Raj Associates and Rs.1,00,351/- & Rs.13,013/- for AYs 2012-13 & 2013-14 respectively in case of M/s. Prakash Trading Co..

4.

Assessee carried the matter by way of filing appeals before the ld. CIT (A) who has dismissed the appeals. Feeling aggrieved, the assessee has come up before the Tribunal by way of challenging the impugned order passed by ld. CIT (A) by filing aforesaid appeals.

5.

We have heard the ld. Authorized Representatives of the parties to the appeal, gone through the documents relied upon and orders passed by the revenue authorities below in the light of the facts and circumstances of the case.

6.

Bare perusal of the impugned orders passed by the ld. CIT (A) goes to prove that the ld. CIT (A) has passed the impugned orders in a mechanical manner without issuing any notice to the assessee. The ld. CIT (A) being a quasi-judicial authority is required to adjudicate upon the controversy at hand in accordance with the rules of natural justice.

7.

Ld. AR for the assessee contended that since legal issue is required to be decided in these cases, he is ready to argue the cases before the Tribunal. However, when the power to decide appeals have been conferred upon ld. CIT (A) by a statute, the issue in controversy is firstly required to be decided by ld. CIT (A) by affording adequate opportunity of being heard to the assessee.

8.

So, without entering into the merits of the controversy at hand, we deem it necessary to set aside the impugned orders and to remit these cases back to the file of ld. CIT (A) to decide afresh after providing an opportunity of being heard to the assessee.

Consequently, appeals bearing ITA No.4363/Del./2016, ITA No.4364/Del./2016, ITA No.4365/Del./2016 & Del./2016 are decided in favour of the assessee for statistical purposes. Order pronounced in open court on this 29th day of September, 2017.

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