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Income Tax Appellate Tribunal, KOLKATA BENCH “A”, KOLKATA
Before: SH. P.M.JAGTAP & SH. S.S. VISWANETHRA RAVI
PER P.M.JAGTAP, ACCOUNTANT MEMBER
This appeal filed by the assessee is directed against the order of Ld. CIT(A)- Durgapur dated 16.11.2016.
The assessee is in the present case is primarily engaged in the business of generation of power. A survey u/s 133A of the Income tax Act, 1961 (in short “Act”) was carried out in the plant cum office premises of the assessee at Damodar Valley Corporation, Mejia Thermal Power Station, P.O.-MTPS, Distt.-Bankura on 14th & 15th January 2013. As revealed during the course of survey as well as subsequent inquiry tax at source was deducted by the assessee u/s 194C from the payments made to the various parties during the year under consideration. According to the AO, some of the payments so made by the assessee were towards fees for managerial services and the assessee therefore, was liable to deduct tax at source from the said payments at a higher rate u/s 194J instead of section 194C. He accordingly worked out the short deduction of tax by the assessee at Rs.1,62,49,153/- and treated the assessee as in default to that extent u/s 201(1) of the Act. He also levied interest of Rs.60,12,187/- u/s 201(1A) and raised total demand of Rs.2,22,61,340/- against the assessee vide an order dated 26.03.2014 passed u/s 201(1)/201(1A) of the Act.
Against the order passed by the AO u/s 201(1)/201(1A), an appeal was preferred by the assessee before Ld.CIT(A) and after considering the submissions made by the assessee as well as the order of the AO passed u/s 201(1)/201(1A) of the Act, Ld.CIT(A) disposed of the appeal of the assessee after recording his observations/ findings as under:-
“Perusal of assessment order and argument submitted by the appellant shows that similar argument has been taken before the appellate proceedings which were taken before the A.O. It is also seen that the appellant had taken shelter of decision of Hon’ble Supreme Court’s decision in the case of Hindustan Coca Cola Beverages Pvt. Ltd. vs CIT [293 ITR 226]. Keeping in view of the aforesaid facts the A.O. is directed to verify the claim of the appellant if the deductees have filed their return and receipt of the same is included in their return, the addition stands deleted. If not so, the disallowance stands confirmed. The appellant is directed to submit his claim before the A.O. In the line of decision of Hon’ble Supreme Court delivered in the case of Hindustan Coca Cola Beverage Pvt.Ltd., the A.O. is directed to give effect of the aforesaid directions. Keeping in view of the aforesaid observations the A.O. is directed to give effect of the decision of Hon’ble Supreme Court in case of demand raised u/s 201(1)/201(A) of the Act.”
Aggrieved by the order of Ld.CIT(A), the assessee has preferred this appeal before the Tribunal.
We have heard the arguments of both the sides and perused the relevant material available on record. Ld. Counsel for the assessee has submitted that a written submission in detail was filed by the assessee during the course of appellate proceedings before Ld.CIT(A) challenging the application of section 194J by the AO to the relevant payments instead of section 194C of the Act. He has contended that the demand raised by the AO by treating the assessee as in default for short deduction of tax at source thus was challenged by the assessee by submitting that section 194C was applicable to the relevant payments and not section 194J. He has submitted that without prejudice to this main contention raised by the assessee, an alternative claim was also made by the assessee before Ld.CIT(A) by relying on the decision of Hon’ble Supreme Court in the case of Hindustan Coca Cola Beverages Pvt. Ltd. vs CIT 293 ITR 226 (SC). He has contented that Ld.CIT(A) vide his impugned order however has only considered the alternative plea of the assessee and has not given any decision on the main issue raised by the assessee challenging the application of section 194J in the elaborate submission filed in writing. Ld. DR on the other hand has contended that if at all the main issue raised by the assessee challenging the application of section 194J of the Act by filing written submission has not decided by Ld.CIT(A) vide impugned order, the matter may be sent back to Ld.CIT(A) for deciding the same on merit.
Since the Ld. Counsel for the assessee also has no objection in this regard, we remit the matter back to Ld.CIT(A) for deciding the main issue raised by the assessee challenging the application of section 194J by filing a written submission.
Ld.CIT(A) shall decide the said issue on merit in accordance with law after considering the written submission filed by the assessee and after giving the assessee proper and sufficient opportunity of being heard.
In the result, the appeal of the assessee is treated as allowed for statistical purposes.
Order pronounced in the open court on 02.08.2018.