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Income Tax Appellate Tribunal, SMC BENCH ‘C’, BANGALORE
PER SHRI AK GARODIA, ACCOUNTANT MEMBER : This appeal filed by the assessee is directed against the order of learned Commissioner of Income-tax (Appeals) – 5, Bangalore dated 14/9/2016 for assessment years 2012-13.
The grounds raised by the assessee are as under:-
“1) The order of the LAA is bad in law and is not in accordance with the provisions of Income Tax Act. 1961.
2) a) The LAA erred in confirming the action of the LAO in disallowing a sum of Rs. 2,52,146/- being interest paid
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to Shristi Corporation for non-deduction of tax at source under section 40(a)(ia) of the Act.
c) The LAA erred in confirming the action of the LAO in not considering that the Appellant had not deducted tax at source on the interest payment of Rs. 2,52,416/- on the strength of the Form 15G issued by Shristi Corporation.
d) As per the provision of section 197A read with rule 29C, where a declaration is furnished to the Appellant in the prescribed form (i.e. Form 15G), the Appellant is not liable/required to deduct TDS on the interest payment made under section 194A.
e) The LAA erred in confirming the action of the LAO in not considering the Form 15G filed by the Appellant to substantiate the non-requirement of tax deduction at source on the interest payment to Shrishti Corporation.
3) a) The LAA erred in confirming the action of the LAO in considering as income of Rs. 14,64,147/- being interest accrued/received from Vijaya Mohini Mills.
b) The LAA erred in confirming the action of the LAO in treating as income of Rs. 14,64,147/- being interest from Vijaya Mohini Mills without considering that the said sum was offered to tax on accrual basis in the earlier years.
c) The LAA erred in confirming the action of the LAO in not considering that the Appellant had claimed a credit
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of the tax deducted at source in the FY 2011-12 relevant to AY 2012-13, since the said tax was deducted and deposited into the Government treasury in the FY 2011- 12.
d) The LAA erred in confirming the action of the LAO in not following the decisions of the Amritsar Income-tax Appellate Tribunal in Societe D'Engineering Pour L'Industrie Et Les Travaux Publics v. ACIT (46 taxman.com 230) which held that credit of tax deducted at source can be claimed in a year in which the income is assessable, or in a later year if the income from which tax has been deducted has already been assessed in an earlier year.”
It was submitted by the ld AR for the assessee that on page No.55 of the paper books is the copy of Form No.15G received by the assessee from Jyothi Kumari for not effecting TDS from interest paid to her during the present year and declaration has been received on 1st March, 2012. It was submitted that therefore, the assessee was not required to deduct TDS from interest paid to her. Reliance was placed on the Tribunal order rendered in the case of Malineni Babulu (HUF), Vs. ITO in ITA No.1326/Hyd/2014 dated 7/8/2015. It was pointed out that in that case, it was held by the Tribunal that if Form No.15H is received by the assesee and even if the assesee is not able to produce any evidence in support of this that said Form was filed before the CIT, it may require separate penal action but for this reason, no addition can be made u/s 40(a)(ia) of the Act. It was also pointed out that the Tribunal has followed another decision rendered in the case of Vijaya
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Bank Vs. ITO reported in 49 Taxmann.com 533. He has submitted copy of this Tribunal order also.
Regarding ground No.3, it was submitted that at page 52 of the paper book is the submissions made by the assessee before CIT(A) in which, it was pointed out that interest from M/s Vijaya Mohini Mills has been considered as income during the financial year 2009-10 to 2010-11 but that company deducted tax TDS in the present year and therefore, income cannot be taxed again in the present year but there is no findings given by the AO/CIT(A) regarding these submissions of the assessee and therefore, on this issue, the matte may be restored back to the file of the CIT(A) for fresh decision after examining this contention of the asseseee. The ld DR of the Revenue supported the order of the ld CIT(A) on both the issues.
I have considered the rival submissions. In view of the facts noted above, I am of the considered opinion that both the issues should be restored back to the file of ld CIT(A) for fresh decision. In respect of first issue, the ld CIT(A) should examine and decide this factual aspect as to whether Form 15G available at page 55 to 56 of the paper book was in fact received by the assessee or not and whether the same was submitted before the CIT or not and he should also consider two Tribunal decisions cited before us as noted above and then decide the issue afresh after providing adequate opportunity of being heard to both sides.
In respect of the issue involved in Ground No.3, the ld CIT(A) should verify whether the income in question being interest received from Vijaya Mohini Mills was in fact offered to tax by the assesee in the earlier years being asst. years 2010-11 and 2011-12 and TDS deducted in the present year by that company is in respect of the same
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income which was offered to tax in earlier years and then decide the issue afresh after providing adequate opportunity of being heard to both sides because if the income is already taxed in earlier years, than the same cannot be taxed in the present year when TDS is deducted by the company. 7. In the result, the asssessee’s appeals is allowed for statistical purposes. Order pronounced in the open court on 29th November, 2017.
Sd/- (AK GARODIA) ACCOUNTANT MEMBER
Vms Bangalore Dated : 29/11/2017
Copy to : 1. The Assessee 2. The Revenue 3.The CIT concerned. 4.The CIT(A) concerned. 5.DR 6.GF By order
Sr. Private Secretary, ITAT, Bangalore.