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Income Tax Appellate Tribunal, “A”, BENCH KOLKATA
Before: SHRI N.V.VASUDEVAN, JM & DR. A.L.SAINI, AM
O R D E R
Per Dr. Arjun Lal Saini, AM
The captioned two appeals filed by the Revenue, pertaining to the Assessment Year 2009-2010 (FY:2008-09. Q.4, Form-26Q-for A.Y. 2009- 10) and ( FY:2008-09. Q.3, Form-26Q- for A.Y.2009-10), are directed against the order passed by ld. CIT(A)-I, Kolkata in Appeal No.559/CIT(A)-I/W-59(4)/2011-12, dated 28.02.2014, which in turn arises out of an order passed by the Assessing Officer (AO) Under Section 201(1)/201(1A) of the Income Tax Act 1961, (hereinafter referred to as the ‘Act’), dated 18.03.2011 and 14.03.2011 respectively.
Since these two appeals ( for different quarters within one A.Y.2009-10), filed by the Revenue, relate to same assesse, same assessment year and common issues involved, therefore these have been clubbed and heard together and a consolidated order is being passed for the sake of convenience and brevity. The facts mentioned in deciding all the appeals, that is, taken by us as a lead case.
Brief facts of the case qua the assessee are that the assessee filed its e-TDS statement and correction statement. The TDS statement has been analyzed on the basis of entries reported by deductor assessee. In the TDS statement the information is available as per bank challan details. The AO noticed that on analysis of these TDS statements some defaults revealed i.e. non-payment of amount deducted, low deduction of TDS at prescribed rates and late payment of taxes. Therefore, the AO issued a show cause notice to the assessee u/s.201(1A) of the Act asking the detailed justification indicating entry-wise reasons of the defaults noticed in the case of deductor-assessee. Since the details were factual and based on the entries reported in the TDS statement, the AO asked the assessee to file the correction statement to rectify the data entry errors if any, within 15 days. The assessee did not file any correction statement upto to the date of order of the AO, therefore, the AO has passed the order on 18.03.2011.
Aggrieved from the order of AO, the assessee filed an appeal before the ld. CIT(A), who has partly allowed the appeal of the assessee observing the followings :-
3. The submissions of the Appellant have been considered. It is seen that the order of the AO is dated 18.03.2011, whereas the Appellant has filed Correction Statement on 22.08.2011 i.e. after the above order. It is also seen that short deduction of Tax has been admitted to the extent of Rs.2,48,486/- in respect of payments to Ogilvy &. Mather Pvt Ltd and Lintas India (P) Ltd and in other cases it is claimed that the payments are covered by section 194C and not u/s 194J. This claim is prima facie found to be correct on the basis of the detailed submission filed by the Appellant. The A.O is accordingly directed to consider the submissions 3 & 1455/kol/14 M/s Tea Board same. Further in respect of short deduction the Appellant claim is to be allowed in view of decision of the Supreme Court in Hindustan Beverages Pvt Ltd vs CIT in 293 ITR 226, the A.O. should therefore give benefit to the Appellant where such payment has been offered to tax by the recipient. However in the above two cases of admitted Short deduction of tax Rs.2,48,486/- and other instances where there is short deduction, the Appellant would still be liable for payment of interest. The A.O is therefore directed to consider the above as well as the correction statement filed on 22.08.2011 and pass a fresh speaking order after due verification as per law. As a result, the Appeal is "Partly Allowed".
Not being satisfied with the order of ld. CIT(A), the Revenue is in appeal before us and has taken the following grounds of appeal :- a. Ld. CIT(A) erred in accepting that payments are covered by section 194C and not u/s. 194J of the I.T.Act, 1961. b. Ld. CIT(A) is not justified in law in admitting fresh evidence in contravention of Rule 46A. c. Ld. CIT(A) has erred in holding that the prima facie payments are covered by section 194C and not u/s. 194J. d. That the Department craves leave to add, alter or modify any ground of appeal during the hearing.
Although in this appeal, the Revenue has raised four grounds of appeal but at the time of hearing the solitary grievance of the Revenue has been confined to the issue that payments made by the assessee are covered by Section 194J instead of Section 194C and the Commissioner of Income Tax (Appeal) has admitted the fresh evidence in contravention of Rule 46A of the I.T.Rules.
6.1 Ld DR for the Revenue has vehement submitted that the during the appellate proceedings before the ld CIT(A), the assessee submitted copy of bills showing deduction of TDS u/s.194C and assessee also submitted the written submissions before the ld. CIT(A). In the written submissions as submitted by the assessee before ld. CIT(A), the assessee mentioned that he made the payment for fabrication of normal tie, advertisement etc, Advertising for fabrication and decoration work, therefore, these are covered u/s.194C. Since the assessee has submitted fresh evidence before the CIT(A), like copy of bills payment and details and statement showing that payments were made by the assessee for fabrication of normal tie, advertisement and decoration expenses, which are covered u/s.194C. These additional evidences like copy of bills, explanation of payment for fabrication, advertisement and decoration were not furnished by the assessee before the AO. Therefore, these are additional evidences and the ld. CIT(A) has violated the provisions of Rule 46A of the I.T.Rules, 1962. Therefore, the said matter requires to be examined by the Assessing Officer.
6.2 On the other hand, ld. AR for the assessee even agreed with the proposition of ld. DR for the revenue to send the matter back to the file of AO to examine the copy of bills, vouchers payment mode and the nature of payment i.e. fabrication advertisement, decoration etc.
6.3. Having heard the rival submissions, perused the material on record, we are of the view that there is merit in the submissions of the Ld DR for the Revenue. As Ld. DR for the Revenue has rightly pointed out that the assessee has submitted before the ld. CIT(A) copies of bills, vouchers, payment mode and the nature of work i.e. fabrication advertisement, decoration etc. The nature of work has not been examined by the AO and the AO also not examined the copy of bills/vouchers etc. Therefore, we are of the view that this issue requires a fresh examination at the end of 5 & 1455/kol/14 M/s Tea Board the AO, therefore, we remit the issue back to the file of the AO to examine the copy of bills/ vouchers and the mode of payment and nature of payment etc. and adjudicate the issue accordingly. 6.4. In the result, both the appeals filed by the Revenue (ITA No.1454 & 1455/Kol/2014), are allowed for statistical purposes. Order pronounced in the open court on this 05/04/2017.