AKSHAR INFRA,BHARUCH vs. ITO(TDS), BHARUCN, BHARUCH

िनधा�रती की ओर से /Assessee by Shri Mandar Vaidya, & Shri Darshan D Jain, AR’s राज� की ओर से /Revenue by Ms. Jayshree Thakur, Sr-DR अपील पंजीकरण/Appeal instituted on 20.04.2023 सुनवाई की तारीख/Date of hearing 20.07.2023 उद्घोषणा की तारीख/Date of 20.07.2023 pronouncement Order under section 254(1) of Income Tax Act PER PAWAN SINGH, JUDICIAL MEMBER: 1. This appeal by assessee is directed against the order of National Faceless Appeal Centre, Delhi [for short to as “NFAC/Ld. CIT(A)”] dated 21.02.2023 for the assessment year 2016-17, which in turn arises out of assessment order passed by Income Tax Officer (TDS), Bharuch / Assessing Officer passed under section 201(1) / 201(1A) of the Income Tax Act, 1961 (‘the Act’) on 28.07.2021. The assessee has raised the following grounds of appeal:

(A.Y 16-17) Akshar Infra “1. The Ld. CIT(A) erred in holding that there was a delay in filing the appeal. It is submitted that the suo motu order of the Hon'ble Apex Court in MA No.665 of 2021 in SMW(C) No.306 of 2020 would squarely apply, under which the time period between 24th March 2020 to 28th Feb’ 2022 stands excluded from the computation of limitation period.

2. The Ld. CIT(A) fell in error of law in holding that the Appellant/assessee was liable to deduct tax u/s 194IA. The Ld. CIT(A)’s order runs contrary to principle laid down by this Hon'ble Tribunal in Vinod Soni 174 ITD 598 (Del.) and Rajesh Kumar Nahar ITA/245/Jodh./2019.

3. The Ld. CIT(A) misdirected himself in not considering the ratio of Hindustan Coca Cola Beverages P. Ltd. vs. CIT 293 ITR 226 (SC) which was specifically brought to his notice.

5. The Ld. CIT(A) failed to make note of the Hon'ble Apex Court’s decision in EliLilly 312 ITR 225 (SC) wherein it was held that the payment by the deductee would be treated as “date on which tax is actually paid.”

.”

2. Brief facts are that assessee is a partnership firm. The assessee purchased immovable property for a consideration of Rs.1.47 crores at Moje Andada vide sale deed dated (A.Y 16-17) Akshar Infra 13.05.2015 from four persons/ co-owners namely R.C. Padshala, P.N. Vaghasia, M.A Vaghasia and C.N. Patel. The assessee was liable to deduct tax at source (TDS) as per the provision of Section 194IA @1% of consideration paid to seller. No such TDS was made by the assessee on such payment of sale consideration. Thus, the assessing officer was of the view that the assessee committed default for non- deducting such TDS. The Assessing Officer issued show cause notice dated 13.07.2021 requiring the assessee to show cause as to why it should not be treated as assessee is in default for not deducting TDS and an order under section 201(1) r.w.s 201(1A) of the Act should not be passed. The assessee filed its reply dated 23.07.2021. The contents of assessees reply was recorded by Assessing Officer in para-4 of the assessment order. The assessee in its reply submitted that assessee purchased the land worth of Rs.1.47 crores from four sellers / co-owners each individual had shown the sale consideration in their individual Income Tax Return (ITR) and payment made to each individual was less than Rs.50 lakh being 1/4th undivided equal share of Rs.36.75 lakh. The assessee has explained that as per Section 194IA, the (A.Y 16-17) Akshar Infra provision of said section is not applicable where the consideration for transfer of immovable property is less than Rs.50.00 lakh. In this case, there were four transferees and the sale consideration for each of the transferee was less than Rs.50.00 lakh. Thus, the provision of law has to be applied with regard to amount related to each transferee.

4. Aggrieved by the order of Assessing Officer assessee filed appeal before Ld. CIT(A) on 22.02.2022. Before Ld. CIT(A) assessee filed its detailed statement of fact. The assessee in its statement of fact submitted that assessee is a partnership firm and during the year under consideration purchased immovable property being an agricultural land for aggregate consideration of Rs.1.47 crores from four co-owners / sellers. All four co-owners were having equal right, title and interest in the property and share of each of owner was Rs.36.75 lakhs. The consideration paid to individual owner / seller was less than Rs.50.00 lakhs, hence, the assessee did not deduct TDS under section 194-IA of the Act. The assessee further submitted that all the four co-owners filed their respective ITR in the following manner: Sr.No. Seller PAN Return filed on 1 C.N.Patel AARPP5332R 13th July 2016 2 P.N.Vaghasiya ABAPV3969L 20th Sep. 2016 3 M.A.Vaghasia AAQPV9317F 20th Sep. 2016 4 R.C.Padshala ABUPP0575E 10th Oct. 2016 5

6. The ld CIT(A) while deciding the appeal of assessee recorded that various notices were issued to the assessee through ITBA portal and no compliance to such notices were made by assessee, therefore the appeal of assessee was decided on the basis of materials available on record. The Ld. CIT(A) noted that impugned assessment order was passed on 28.07.2021, however, the appeal was filed on 22.02.2022 thus there was (A.Y 16-17) Akshar Infra a delay of 166 days in filing the appeal and no affidavit for seeking condonation is filed by assessee. The Ld. CIT(A) by referring certain decisions of superior courts held that appeal of assessee is time barred and not maintainable/ not admitted for adjudication. 7. However, Ld. CIT(A) also considered the merit of the case on the basis of statement of facts available on record. The Ld. CIT(A) concurred with the findings of Assessing Officer by holding that the assessee is defaulter within the meaning of section 201(1) and also liable to pay interest @ 1% for every month or part of month on the amount of such tax from the date the TDS was to be made. The contention of assessee that they are liable for interest liability only for 14 months commencing from May 2015 till end of September 2016, was also rejected by taking view that such plea was applicable when they were not deemed to be assessee in default. Further aggrieved assessee has filed present appeal before the Tribunal. 8. We have heard the submission of Ld. Authorized Representative (Ld. AR) for the assessee and Ld. Senior Departmental Representative (ld. Sr-DR) for the Revenue and (A.Y 16-17) Akshar Infra have gone through the orders of lower authorities carefully. The Ld. AR for the assessee submits that he has raised a specific grounds of appeal

against the order of ld. CIT(A) in not admitting the appeal by taking view that appeal was delayed by 166 days from the period of limitation. The Ld. AR for the assessee submits that before passing the order, the Ld. CIT(A) has not given any show cause notice on the issue of limitation. The Ld. AR for the assessee submits that the period of limitation was covered by the decision of Hon'ble Apex Court in Suo Motu Writ Petition (C) No.3 of 2020, wherein the time limit for filing various appeals under general law as well as under special law were extended till 28.02.2022 and further 90 days’ grace period was allowed with effect from 01.03.2022. Thus, the appeal filed by assessee before ld CIT(A) was within the extended period of limitation as allowed by Hon'ble Apex Court to file appeal/appeals before various judicial forum / authorities. The ld AR for the assessee submits that entire alleged period of delay was covered by the decision of Hon'ble Apex Court and Ld. CIT(A) ought to have considered such law declared by Hon'ble Apex Court. The Ld. AR for the assessee further reiterated that no show cause (A.Y 16-17) Akshar Infra notice issued before passing such order to assessee and as such the finding of ld CIT(A) is liable to be set aside.

9. On merit, the Ld. AR for the assessee submits that all the sellers / co-owners have included the sale consideration in their total income while filing their respective ITR for the relevant assessment year. Therefore, the assessee cannot be treated as assessee “in default”. The Ld. AR for the assessee submits that he is filing copy of ITR along with the computation of income. The Ld. AR for the assessee submits that for verification facts, the matter may be restored back to the file of Assessing Officer to verify the fact that all the sellers / co-owners have included the consideration in their total income while filing in their respective ITR and he undertakes to file certificate of Chartered Accountant under Form-26A in Rule 31ACB for compliance of first proviso to Section 201(1). The ld AR for the assessee submits that at the most, the assessee can only be held liable for interest for deleted period till the filing of ITR by the sellers / co-owners.

10. On the other hand, Ld. Senior Departmental Representative (Ld. Sr-DR) for the Revenue supported the order of lower authorities. The Ld. Sr-DR for the Revenue submits that (A.Y 16-17) Akshar Infra aggregate value of consideration of the immovable property was admittedly more than Rs.50.00 lakh, the assessee has paid a total sale consideration of Rs.1.47 crores to the sellers / co-owners and was under obligation to deduct TDS as per the provision of Section 194-IA of the Act. The explanation of assessee was that consideration of each co-owner was less than Rs.50.00 lakh cannot be considered when the aggregate value of sale consideration was more than threshold limit of Rs.50.00 lakh. On the plea of Ld. AR for the assessee that matter may be restored back for verification of ITR of sellers that they have included the consideration in their total income and offered the said consideration, in their respective return of income, the Ld. Sr-DR for the Revenue submits that Bench may take decision as per law, however, she supports the order of lower authorities.

11. On the observation of Ld. CIT(A) about the delay in filing, the Ld. Sr-DR for the Revenue submits that at least assessee was required to explain such fact, in its statement of fact about the unavoidable circumstances.