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Facts
Pepsu Road Transport Corporation (PRTC), a State Government Undertaking, failed to collect TCS under Sections 206C(6A) and 206C(7) for parking road receipts for AY 2013-14, resulting in a default of Rs. 8.58 lakhs. An order was passed by the ITO (TDS) on 10.02.2021, against which PRTC filed an appeal before the first appellate authority (FAA) on 11.12.2023, incurring a delay of 1004 days. The FAA dismissed the appeal as not maintainable under Section 249(2) due to this delay, without addressing the merits of the case.
Held
The Tribunal found that the assessee, being a State Government Undertaking, did not exhibit willful default or neglect, and the delay was attributable to incorrect professional advice. In the interest of justice, the Tribunal condoned the delay of 1004 days and remanded the matter back to the FAA for adjudication on the merits of the various issues raised. The Tribunal did not express any opinion on the merits of the case itself.
Key Issues
Whether the delay in filing the appeal before the first appellate authority should be condoned; and whether the assessee is liable for non-collection of TCS under Section 206C(6A) and 206C(7).
Sections Cited
250, 206C(6A), 206C(7), 249(2), 206C, Rule 34(4) of the Income Tax (Appellate Tribunal) Rules, 1963
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, AMRITSAR BENCH, AMRITSAR
Before: SH. MANOJ KUMAR AGGARWAL & SH. UDAYAN DASGUPTA
This appeal is filed by the assessee against the order of the ld. Addl./JCIT (A)- 1, Jaipur dated 30.04.2024 passed u/s 250 of the Income Tax Act, 1961 which has emanated from the order of the ITO (TDS), Jalandhar passed u/s 206C(6A) of the Act, 1961 dated 10.02.2021. objection of the assessee is that the appeal has not been decided on merits by the ld. first appellate authority, because the appeal was belatedly filed by more than 1000 (One thousand) days and the ld. first appellate authority has not admitted the appeal for adjudication on merits and has treated the same as not maintainable by invoking the provisions of section 249(2) of the Act, 61.
Brief facts emerging from records are that the assessee is a State Government Undertaking engaged in Transport Activities and are receiving ADPA fees, license fees and parking fees from two wheelers and other vehicles. On inspection of records it has been ascertained by the Income Tax Officer, TDS, Jalandhar, that the assessee PEPSU Road Transport Corporation (PRTC), Kapurthala holding [TAN:
JLDG01261B], has failed to collect the TCS as per provisions of section 206C(6A) and 206C(7) of the Act, 1961 relating to the receipts collected for use of parking roads for the financial year 2012-13 from the licensee/lessee.
4. As such, on account of failure to comply with the provisions of this aforesaid section, the assessee has been held to be assessee in default u/s 206C of the Act for non-collection of TCS, resulting in total TCS default of Rs.8.58 lakhs (including interest u/s 206C(7) of the Act as applicable). before the ld. first appellate authority on 11.12.2023 which was belated by 1004 (One thousand four) days. The said appeal has been dismissed as not maintainable by the ld. first appellate authority refusing to condone the delay and dismissing the appeal (without adjudication on merits) u/s 249(2) of the Act.
6. Now, the assessee is in appeal before the Tribunal on various grounds contained in the memorandum of appeal. In course of hearing, the ld. AR of the assessee filed an affidavit which is sworn by the General Manager of the State Government Undertaking (PRTE) Mr. Parveen Kumar, explaining the delay in filing the appeal before the ld. first appellate authority and has prayed for condonation of the said delay of 1004 (one thousand four) days and has prayed that an opportunity of hearing may please be allowed to the assessee before the ld. first appellate authority, to explain the merits of the case.
The contents of the affidavit explaining the delay are reproduced for ready reference:
“1. That the TAN No, of the assessce is JLDG012618.
That the present case relates to TDS assessment framed u/s 206C(6A) and 206C(7) vide order of Ld. AO dtd. 10.02.2021 against which appeal was filed before Worthy CIT(A) on 11.12.2023. The Worthy CIT/A) dismissed the appeal of the assessee vide order dtd. 30.04.2024.
3. That the due date of filing the appeal before the Worthy CIT(A) was 12.03.2021, however the appeal was actually filed before him on 11.12.2023, i.e. with a delay of 1004 days beyond the prescribed limitation period.
That the assessce is a State Government undertaking engaged in transport activities, whose officials are not well-versed with the intricacies of income-tax provisions and were entirely dependent upon professional advice for compliance. The deiny occurred on seesunt of circumstances completely beyond the control of the assessee and without any mala fide intention.
That regarding the reason for delay in filing the appeal before the Worthy CITIA), it is most respectfully submitted that:
a. Immediately upon receipt of the impugned order passed by the Id. AO did. 10.02.2021. the assessee was consistently advised by its consultant to first obtain PAN and assessment details of the contractors from whom adda fee and parking lot charges were collected, so as to mitigate being treated as an assessee in default since the provisions of s. 206C(6A) and 206C(7) clearly provide that if the deductor having failed to deduct provides particulars of deductee and also provides certificate in Form 26A from that deductee, it shall not be treated as an assessee in default. b. That the assessee in good faith, made diligent efforts to comply with such advice, though it could not succeed in securing all requisite details. c. That unfortunately, the assessee was never apprised about the alternate statutory comedy of filing appeal before the Worthy CIT(A), due to which the assessee did not initiate appellate proceedings within the prescribe in time. d. That the concerned employees of the assessce at PRTC, being non-experts in taxation law, were not aware of the relevant legal provisions and acted strictly on the basis of the advice rendered by the engaged professional. e. That even the advice above referred about obtaining PAN and 26A from the deductee was not a blatant bad advice and was in-fact one of the other possible/ alternate remedies available with the assessee against the TDS assessment order. It is also a settled law that Assessment Year: 2013-14 when an assessee takes route of one possible remedy and later chooses the route of other alternate remedy on changed legal advice, the time lost in exploring the first remedy should be excluded in counting the limitation to use the second remedy. f. That after passage of time it came to the knowledge of the Kapurthala Depot of the assessee that the Patiala Depot of PRTC had already challenged similar additions by filing appeal before the Worthy CIT(A). This revelation. made the assessee realize that appeal remedy was available to it as well which could not be exercised due to lack of proper guidance. g. That thereafter, the assessee promptly engaged another counsel at Patiala, who, after examining the records, advised filing of the present appeal and the assessee then immediately filed the appeal which got delayed by 1004 days.
That the delay caused was totally unintentional and bona-fide on part of the assessee.
7. That in the light of above facts and more so in the interest of natural justice, it is prayed that the delay of 1004 days in filing of the appeal before the Worthy may please be condoned.”
The ld. AR further submitted that the employees of the State Government Undertaking are not well versed with the various provisions of Income Tax Laws and are entirely dependent upon professional advice for compliance. The assessee was advised by this existing tax consultant to first collect and obtain the PAN numbers of various contractors from whom fees and various other charges are collected so that certificates in Form No. 26AS could be furnished from those deductees which will absolve the assessee to be treated as an assesse in default, but the consultant never advised the assessee to file an appeal against the said order and because incorrect advice resulted in huge delay. of PRTC, has also filed similar appeals before the appellate authorities, and thereafter, on advice of newly appointed counsel, the assessee has taken steps to file appeal before the ld. first appellate authority which was delayed by 1004 days and since this delay was not intentional and there was no neglect on the part of the assessee or his employees, it has been humbly prayed by the ld. AR that the delay may please be condoned and the matter may please be remanded back to the ld. first appellate authority for adjudication on various grounds contained in Form No. 35 on merits of the case, and the ld. AR has agreed to fully cooperate in appellate proceedings for proper disposal of the appeal.
The ld. DR has no objection if the matter is remanded back to files of the ld. first appellate authority for adjudication on merits.
We have heard the rival submissions and considered the materials on record and we find that the assessee is a State Government Undertaking and there has not been any willful default or neglect on the part of the assessee in filing the appeal belatedly before the ld. first appellate authority and the delay seems to have occurred as stated due to incorrect advice by the existing counsels of the assessee which has resulted in this inordinate delay. back to the files of the ld. first appellate authority for adjudication of the appeal on the various issues contained in Form No. 35 on merits, and we also direct the assessee to fully cooperate in the appellate proceedings by furnishing all particulars and documents and submissions in support of its contentions.
The assessee shall be allowed reasonable opportunity of being heard.
We have not expressed any opinion on merits.
In the result, the appeal filed by the assessee is allowed for statistical purposes.
Order pronounced in accordance with Rule 34(4) of the Income Tax (Appellate Tribunal) Rules, 1963 as on 16.10.2025