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Income Tax Appellate Tribunal, “C” BENCH : BANGALORE
Before: SHRI SUNIL KUMAR YADAV & SHRI INTURI RAMA RAO
Per Sunil Kumar Yadav, Judicial Member
This appeal is preferred by the assessee against the order of the CIT(Appeals), Belgaum dated 4.2.2014 for the assessment year 2007-08 inter alia on the following grounds:-
“1. The order of the learned Commissioner of Income-tax (Appeals) to the extent it is against the appellant is opposed to law, weight of evidence, natural justice, probabilities on facts and in circumstances of the case.
2. The learned Commissioner of Income-Tax (Appeals) failed to appreciate that the Appellant is not liable to pay interest a sum of Rs.4,72,24l/- under section 20l(lA) of the Act on the facts and circumstances of the case.
3. The Appellant denies itself liable to be assessed under the provisions of section 201 (lA) of the Act when the proceedings under the provisions of section 201 (1) were dropped on facts and in circumstances of the case.
4. The learned Commissioner of Income-Tax (Appeals) failed to appreciate that once the recipient of the amount i.e., B.LD.E Association is not at all liable to pay any tax the question of payment of any interest for any delayed payment does not arise on the facts and circumstances of the case.
5. The Appellant craves to add, alter, delete or substitute any of the grounds urged above.
6. In view of the above and other grounds as may be urged at the time of hearing of the appeal, the Appellant prays that the appeal may be allowed in the interest of justice and equity.”
During the course of hearing, the ld. counsel for the assessee has invited our attention to the order of the Assessing Officer with the submission that the proceedings u/s. 201(1) were dropped by the Assessing Officer himself, having held that there was no liability to deduct tax at source upon the assessee, but has levied interest as provided u/s. 201(1A) of the Act. Once the assessee is not liable to tax deduction at source (TDS), there is no question of its payment within the reasonable time and on account of non-payment, interest u/s. 201(1A) cannot be charged. We are, therefore, of the view that undisputedly the assessee was not held to be in default as there is no liability to TDS, therefore, interest u/s. 201(1A) cannot be charged. Accordingly, we set aside the order of the CIT(Appeals) and delete the interest u/s. 201(1A) of the Act.
In the result, the appeal by the assessee is allowed.
This appeal is preferred by the assessee against the order of the CIT(Appeals), Belgaum dated 4.2.2014 for the assessment year 2009-10 inter alia on the following grounds:-
“1. The order of the learned Commissioner of Income-tax (Appeals) to the extent it is against the appellant is opposed to law, weight of evidence, natural justice, probabilities on facts and in circumstances of the case. 2. The Appellant denies itself liable to be assessed on an income of Rs.14,76,360/- against nil returned income on the facts and in circumstances of the case.
3. The learned Commissioner of Income-Tax (Appeals) has erred in law and in facts in not availing the Appellant a reasonable opportunity of being heard which is in violation of principles of natural justice on the facts and circumstances of the case.
4. The learned Commissioner of Income-Tax (Appeals) is not justified in holding that the activity undertaken by the Appellant is hit by the proviso to section 2(15) of the Act when admittedly the activity of the Appellant is education and medical and consequently the proviso to section 2(15) is not applicable on the facts and circumstances of the case 5. The learned Commissioner of Income-Tax (Appeals) has erred in law and in facts in not granting the exemption to the Appellant on the income of the pharmacy in accordance with the law on the facts and circumstances of the case. 6. Without prejudice the Appellant was entitled to exemption under section 11 of the Act on the facts and circumstances of the case. 7. The Appellant denies itself to be liable to be charged for interest under the provisions of section 234A, 234B and 234C of the Act on the facts and circumstances of the case. 8. The Appellant craves to add, alter, delete or substitute any of the grounds urged above. 9. In view of the above and other grounds as may be urged at the time of hearing of the appeal, the Appellant prays that the appeal may be allowed in the interest of justice and equity.”
During the course of hearing, the ld. counsel for the assessee has invited our attention to the order of the Tribunal in which registration denied by the CIT was allowed by the Tribunal. A copy of the order of the Tribunal is also placed on record, wherefrom it is evident that the Tribunal has allowed registration with effect from the impugned assessment year.
Whereas, the lower authorities have denied the benefit of exemption having relied upon the order of the CIT, whereby he denied registration u/s. 12A of the Act. Since registration has been finally granted to the assessee, a fresh assessment is required to be passed with respect to exemption claim made by the assessee. We, therefore, set aside the order of the CIT(Appeals) and restore the matter to the file of the Assessing Officer with a direction to frame the assessment de novo in the light of the fact that the registration u/s. 12A of the Act has been granted to the assessee.
In the result, the appeal by the assessee is allowed for statistical purposes.
Thus, the appeal of the assessee in ITA 499/Bang/2014 is allowed, whereas that of the assessee in is allowed for statistical purposes.
Pronounced in the open court on this 29th day of July, 2016.