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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:-
These four appeals by the assessee are arising out of common order of Commissioner of Income Tax (Appeals)-Siliguri in appeal No.08.09,02 dated 28.02.2013. Assessment was framed by ACIT (TDS), Siliguri u/s 201(1)/201(1A) of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) vide his orders dated 16.03.2012, 17.03.12 & 11.04.2012 for assessment year 2008-09 respectively.
& 30-32/Kol/2016 A.Y. 08-09 NHAI v. ACIT (TDS), Slg. Page 2 Shri S.M.Surana, Ld. Authorized Representative appearing on behalf of assessee and Shri Sallong Yaden, Ld. Departmental Representative appearing on behalf of Department.
At the outset we find that out of four appeals – three appeals are barred by limitation as there is a delay of 957 days. The assessee has filed condonation petition for the delay in filing the appeal. The condonation petition is reproduced below:- “The Ld. Assessing Officer passed 4 orders under sec. 201, 201(1A) for F.Y 2007-08 against which 4 appeals were filed before the Ld. CIT(A), Siliguri. In all the 4 appeals same and similar question was involved. The Ld. CIT(A) by a common order mentioning one assessment year passed the order against us. Since only one assessment year was mentioned in the order passed by Ld. CIT(A) we were under the reasonable belief that since the appeal relates to one assessment year a single appeal is to be filed against the common order passed by the Ld. CIT(A), Siliguri. The said appeal was filed on 25.4.2013 which was within time. However, we have been advised that separate appeals should have been filed against the 4 appeals which were disposed off by the Ld. CIT(A), Siliguri by a common order. We are, therefore, filing 3 more appeals for second, third and fourth quarter for F.Y 2007-08 against the separate order passed by the Ld. Assessing Officer and which were disposed off b the ld. CIT(A), Siliguri by a common order. Sir, the delay caused was because of the genuine impression that only one appeal is to be filed against a common order under a bonafide belief and as such the same is unintentional. Furthermore we duly contested the entire order of Ld. CIT(A), Siliguri in the grounds of appeal
taken by us. In view of the above it is humbly requested to your honour to be kind enough to admit the 3 appeals now being filed and decide the same on the grounds taken by us. The earlier appeal may be treated as appeal for the Ist Quarter of F.Y. 2007-
08. For the act of kindness we as in duty bound shall ever pray.“ In this view of the matter Ld. DR has raised no objection for condoning the delay. Hence, considering the gravity and delay of filing these appeals are on & 30-32/Kol/2016 A.Y. 08-09 NHAI v. ACIT (TDS), Slg. Page 3 simply bona fide belief, we condone the delay and admit for hearing these appeals.
Since the issues raised are common in all the grounds of appeal
s except amount, therefore we heard them together and to pass a consolidated order for the sake of convenience. We are taking the appeal in of 4th quarter for the financial year 2007-08 as the lead case. Grounds raised by assessee are as under:- “1. For that the order of the Ld. CIT(A) is arbitrary, illegal and bad in law.
2. For that the order is bad in law ad is barred by limitation and is therefore liable to be quashed.
3. For that the Ld. CIT(A) erred in confirming the order of the AO when, before passing the impugned order the Ld. AO did not pass any order treating the assessee as assessee in default.
4. For that the Ld. CIT(A) erred in confirming the order of the AO ignoring the date on which the tax deducted was actually paid and taking into account the amount credited to the account of the Central Government as actually paid.
5. For that the ld. CIT(A) should have kept in mind that the Bank to whom cheques were tendered were acting on behalf of the Central Government as per the Notifications issued by the Central Government for collection of the Government dues.
6. For that on the facts and circumstances of the case and accepted principles of law the Ld. CIT(A) should have treated the payment tendered by the assessee as the date of payment of the taxes.”
Ground on merit : The common issue in all the grounds of appeal is that the ld. CIT(A) erred in confirming the order of AO by imposing the interest of ₹2,63,670/- for delayed deposit of TDS amount in Government account.
Ground on legal issue : The issue raised by assessee in this appeal on the legal ground is that the order passed by Assessing Officer is barred by limitation. & 30-32/Kol/2016 A.Y. 08-09 NHAI v. ACIT (TDS), Slg. Page 4 4. Before going on the facts of the case, let us understand the background of the case in brief. Facts in brief are that the assessee in present case is an autonomous body of Central Government under the Ministry of Road Transport & Highways, Govt. of India and is engaged in the business activity of road construction. During the course of assessment proceedings, Assessing Officer found that payment of Tax Deducted at Source (TDS) has been delayed in the account of Government. Therefore, AO found the assessee in default in terms of the provisions of Sec. 201(1)/201(1A) of the Act. Accordingly AO imposed the interest for an amount of ₹2,63,670/- for the delayed deposit of TDS.
Aggrieved, assessee preferred an appeal before Ld. CIT(A) who confirmed the action of AO by observing as under:- “Following the above order of the Hon'ble ITAT, Agra Bench I hold that the Ld. ACIT, (TDS), Siliguri was justified in levying interest us. 201(1A) of the IT Act,1961. I further hold that levy of interest u/s 201(1A) is mandatory if TDS has not been actually paid to the Government account by the due date of deposit as per the relevant provisions of the Act. In the present case as the assessee has not actually paid TDS by the due date of deposit due to reasons of late clearing of cheques or non-availability of authorized signatories of cheque levy of interest u/s. 201(1A) of the Act on the assessee is fully justified Therefore, I am not inclined to interfere with the orders of the Ld. ACIT, (TDS), Siliguri u/s 201(1)/201(1A) of the IT Act, 1961 for 1st Quarter, 2nd Quarter, 3rd Quarter and 4th Quarter.”
Being aggrieved by this order of Ld. CIT(A) assessee preferred second appeal before us.
The ld. AR before us on the legal ground submitted that the order passed by the AO is time barred as per the provisions of section 201(3), therefore it requires to be quashed. On merit also the ld. AR submitted that the lower authorities have held the delay on account of realization of cheques in the Government account. The lower authorities did not consider the date of & 30-32/Kol/2016 A.Y. 08-09 NHAI v. ACIT (TDS), Slg. Page 5 tendering the cheques in the bank. On the other hand the ld. DR relied on the order of authorities below.
6.1 We have heard rival contentions of both parties and perused the materials available on record. From the aforesaid discussion we understand that interest was imposed by the AO on account of delay in the realization of TDS cheques in the Government account and the same was confirmed by the ld. CIT(A). The order for levying the interest was passed by the AO under section 201(3) which provides the time limit for the passing of the order. Before us the ld. AR submitted that the order by the AO for the levy of interest has been passed after its stipulated time. Now let us understand the provisions of section 201(3) in the context of the present case then applicable for the previous AY 2007-08. The relevant portion of section 201(3) prior to its amendment then applicable to the assessee for the AY 2008-09 are as under:- “4. Substituted by the Finance (No.2) Act, 2014 w.e.f. 1-10-2-14, Prior to its substitution, sub-section (3), as amended by the Finance Act, 2012, w.r.e.f. 1-4-2010, reads as under:- ‘(3) No order shall be made under sub-section (1) deeming a person to be an assessee in default for failure to deduct the whole or any part of the tax from a person resident in India, at any time after the expiry of – (i) Two years from the end of the financial year in which the statement is filed in a case where the statement referred to in section 200 has been filed; (ii) Six years from the end of the financial year in which payment is made or credit is given, in any other case: Provided that such order for a financial year commencing on or before the 1st day of April, 2007 may be passed at any time on or before the 21st day of March, 2011”
From the above, we find that the proviso to Sec. 201(3) is applicable to the instant assessee for the assessment year 2008-09, as it clearly states that the time limit for passing the order u/s 201(3) of the Act for a financial year commencing on or before 1st day of April 2007 may be passed at any time on & 30-32/Kol/2016 A.Y. 08-09 NHAI v. ACIT (TDS), Slg. Page 6 or before the 31st March 2011. In the present case, the financial year is beginning w.e.f. 1.4.2007 so the time limit for passing the order u/s 201(3) of the Act by the AO is 31.3.2011. However, the AO has passed the orders in the present case on several dates i.e., on 11.04.2012, 17.3.2012 and 16.3.2012 respectively which are clearly after the stipulated time. Accordingly, we reverse the orders of authorities below.
Since we have already decided the matter in appeal on the basis of legal ground in favour of the assessee, therefore remaining grounds do not require any adjudication on merits.
In the remaining appeals, since the facts are exactly identical, both the parties are agreed whatever view taken in the above appeal (ITA No.32/Kol/2016) may be taken in these appeals also, we hold accordingly.