Loading judgment…
No AI summary yet for this case.
Income Tax Appellate Tribunal, KOLKATA BENCH “B” KOLKATA
Before: Shri Mahavir Singh & Shri Waseem Ahmed
आदेश /O R D E R
PER Waseem Ahmed, Accountant Member:-
Both appeals by the assessee are arising out of order of Commissioner of Income Tax (Appeals)-XIX, Kolkata in appeal No.98-97/CIT(A)-XIX/Wd- 57(2)/Kol/11-12 dated 08.01.2013. Assessments were framed by ITO Ward- 57(2), Kolkata u/s 206C(7) of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) vide his order dated 19.11.2008 for assessment years 2005-06 and 2006-07 respectively.
2. Since common grounds are involved except the change in the figures in both the appeals, therefore, they were heard together and are being disposed of by way of this common order for the sake of convenience. Hence, we take A.Ys. 2005-06 & 2006-07 Bansilal Leisure Parks Ltd. v. ITO (TDS) wd-57(2) Kol. Page 2 the lead case in ITA No.507/Kol/2013 for A.Y. 2006-07 and reproduced the grounds as under:- “1. Ground No. 1 That on the facts & in the circumstances of the case and in law, the Ld. CIT(Appeals) has erred in confirming the order of Assessing Officer on account of TCS & interest on TCS assessed u/s 206(6) & 206C(7).
Ground No. 2 That on the facts & circumstances of the case & in law, the Ld. CIT(Appeals) has misinterpreted the provision of Sec. 206C(6) & 206C(7).
Ground No. 3 That on the facts & circumstance of the case, the Ld. CIT(Appeals) has failed to apply his mind in the facts, and the documents as evidence produced by the appellant assessee.
Ground No. 4. That the Ld. CIT(Appeals)called for a remand report and the Assessing Officer came to the conclusion that all the deductes have filed the I.T Returns & paid taxes thereon. On these facts, the finding of the CIT(Appeals) is completely erroneous, perverse & illegal.
5. Ground No.5 That in deciding the appeal the Ld. CIT(Appeals) has misconstrued the Apex Court’s judgment as well as that of High Courts which led him to arrive at a arbitrary, vindictive and malafide conclusion.
Ground No.6 That the demand of tax on TCS being Rs.77,56,739/- is illegal & not in accordance in the Income Tax Act.”
3. There is common and single issue involved in both the appeals. The issue raised by assessee in appeal is that Ld. CIT(A) erred in confirming the order of the Assessing Officer by treating assessee in default for non- collection of tax at source as per the provisions of Section 206C(6A) of the Act. 3.1 Facts of the case are that assessee is a Private Limited Company and engaged in the wholesale business of timbers. During the course of assessment proceedings, AO found that assessee has made sale of the timbers to various parties but failed to collect TCS in terms of the provisions of the Sec.206C(6) of the Act. The party-wise detail of sale of timbers is reproduced below :- Sl. Name of the buyers Amount of sale (Rs) No. 1 D.D Enterprises 2,27,98,516/- 2 Zenith Timbers Products Pvt.Ltd 3,73,21,252/- A.Ys. 2005-06 & 2006-07 Bansilal Leisure Parks Ltd. v. ITO (TDS) wd-57(2) Kol. Page 3 3 Rajputana General Comm Corp (P) Ltd 3,64,33,527/- 4 Vaishno Timber Pvt Ltd. 88,42,499/- 5 Timtech India Pvt Ltd 87,73,024/- 6 Arpan Fiscal Services 90,99,822/- 7 Eastern Timber Commo. Trade Pvt.Ltd. 3,56,99,641/- 8 Shree Impex 2,58,27,077/- 9 A.B.Funishing Pvt. Ltd. 67,46,304/- 10 Shyam Sales Agencies 6,64,161/- 11 Chowdhury Enterprises 1,40,51,426/- 12 Shivang Prexim Pvt. Ltd. 1,52,17,526/- 13 S.R.Timber Works Pvt. Ltd. 18,45,000/- Total Rupee 22,93,19,778/- On query for the said default, assessee submitted that buyers of the timber have paid the taxes in their respective returns of income, so assessee should not be treated as assessee in default. However, AO rejected the claim of assessee by holding that the assessee has grossly violated the provisions of Sec. 206C of the Act. Accordingly, AO disallowed the sum of Rs.22,93,19,778/- @ 2.5% of the sales and added it to the total income of assessee.
4. Aggrieved, assessee preferred an appeal before Ld. CIT(A) and submitted that all the parties to whom the sales were made by the assessee, have paid the taxes by filing their income tax returns. The assessee relied on the order of Hon’ble Apex Court in the case of Coca-cola Beverage Pvt. Ltd. vs CIT (2007) 293 ITR 226 (SC) wherein it was held that “the tribunal came to the right conclusion that the tax once again could not be recovered from the appellant (deductor assessee) since the tax has already been paid by the recipient of income. However, the ld. CIT(A) has disregarded the plea of the assessee and added to the total income of the assessee.
Being aggrieved by this order of Ld. CIT(A) assessee preferred second appeal before us. -507/Kol/2013 A.Ys. 2005-06 & 2006-07 Bansilal Leisure Parks Ltd. v. ITO (TDS) wd-57(2) Kol. Page 4 Shri Saumitra Chowdhury, Ld. Authorized Representative appearing on behalf of assessee and Shri Debasish Roy, Ld. Departmental Representative appearing on behalf of Revenue.
We have heard rival submissions of both the parties and perused the materials available on record. Before us the ld. AR submitted that all the parties to whom sales were made by the assessee have duly furnished income tax returns. Therefore the ld. AR contended that the assessee in the present case cannot be treated as assessee in default. The AR also submitted that the Hon’ble Tribunal of Kolkata has already decided the issue in favour of the assessee in its own case in for the AYs 2007- 08 and 2008-09 respectively dated 20-01-2016. On other hand the ld. DR vehemently relied on the orders of authorities below. 5.1 From the aforesaid discussions, we find that the assessee failed to collect the TCS at the time of selling the timber to the parties as per the provisions of law. Accordingly the AO treated the assessee in default and raised the demand of the tax. However we find that the similar issue is already covered in favour of assessee by Hon’ble Tribunal of Kolkata in its own case in ITA No. 573-574/Kol/2013 for the AYs 2007-08 and 2008-09 dated 20-01- 2016. However we find from the order of ld. CIT(A) that the assessee has submitted that the copies of the ITR of the parties to whom goods were sold for a value of Rs. 16,57,64,885.00 as detailed under : Sl.N0. Name of the parties Amount (Rs) Date of filing return for the AY 06-07 1 Zenith Timber Products (P) Ltd. 3,73,21,252.60 27.11.2006 2 Timtech India (P) Ltd. 87,73,024.00 27.11.2006 3 Vaishno Timber (P) Ltd. 88,42,500.00 29.11.2006 4 Rajputana General Comm.Corpn (P) 3,64,33,527.33 30.11.2006 Ltd. 5 Eastern Timber Commo Trade (P) 3,56,99,639.30 29.11.2006 Ltd. 6 Chowdhury Enterprise 1,40,51,426.35 31.10.2006 7 DD Enterprise 2,27,98,516.00 31,10.2006 8 S.R Timber Products (P) Ltd. 18,45,000.00