M/S PUNJAB NATIONAL BANK,HAMIRPUR vs. JT.CIT(OSD), TDS CIRCLE, PANCHKULA

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ITA 305/CHANDI/2023Status: DisposedITAT Chandigarh09 October 2024AY 2011-12Bench: SHRI. AAKASH DEEP JAIN (Vice President), SHRI. VIKRAM SINGH YADAV (Accountant Member)3 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal held that the assessee was not provided a proper opportunity and the CIT(A) passed ex-parte orders. Therefore, the matters were set aside to the CIT(A) for fresh adjudication.

What were the facts?

The assessee, Punjab National Bank, failed to deduct TDS on certain interest payments, leading to demands for tax, interest, and penalty. The CIT(A) passed ex-parte orders confirming the AO's and JCIT's actions.

What were the issues?

Whether the orders passed by the AO and JCIT were barred by limitation and whether the assessee was denied a proper opportunity of being heard by the CIT(A).

Which sections of the Income-tax Act were involved?

Section 194A,Section 201(1),Section 201(1A),Section 271C,Section 274

AI-generated summary — verify with the full judgment below

आयकर अपीलीय अिधकरण,च"ीगढ़ "ायपीठ “बी” , च"ीगढ़ IN THE INCOME TAX APPELLATE TRIBUNAL, CHANDIGARH BENCH “B”, CHANDIGARH HEARING THROUGH: PHYSICAL MODE "ी आकाश दीप जैन, उपा"" एवं "ी िव"म िसंह यादव, लेखा सद" BEFORE: SHRI. AAKASH DEEP JAIN, VP & SHRI. VIKRAM SINGH YADAV, AM आयकर अपील सं./ & 305/Chd/2023 िनधा"रण वष" / Assessment Year : 2011-12 M/s Punjab National Bank The Jt. CIT(OSD) बनाम BO-, New Road Hamirpur, Himachal TDS Circle, Panchkula, Haryana Pradesh "ायी लेखा सं./PAN NO: AAACP0165G अपीलाथ"/Appellant ""थ"/Respondent िनधा"रती की ओर से/Assessee by : Shri Alok Krishan, C.A राज" की ओर से/ Revenue by : Dr. Ranjit Kaur, Addl. CIT, Sr. DR सुनवाई की तारीख/Date of Hearing : 03/10/2024 उदघोषणा की तारीख/Date of Pronouncement : 09/10/2024 आदेश/Order PER BENCH :

These are two appeals filed by the Assessee against the order of the Ld. CIT(A)/NFAC, Delhi each dt. 14/03/2023 pertaining to Assessment Year 2011-12 confirming the order passed by the AO under section 201(1) r.w.s 201(1A) dt. 31/03/2018 wherein he has determined the tax under section 201(1) amounting to Rs. 912,622/- and interest under section 201(1A) amounting to Rs. 766,602/- and the levy of penalty by the ld JCIT under section 271C amounting to Rs 912,620/- vide order dt. 02/07/2018.

2.

Briefly the facts of the case are that basis information submitted by the assessee, it was observed by the AO that the assessee has failed to deduct taxe under section 194A in certain cases and thereafter show cause was issued to the assessee and after considering the submissions so filed by the assessee, the AO observed that the cases include payment of interest on saving bank account and giving the benefit of such cases, the AO held that the assessee has not stated anything for non-deduction/lower deduction of TDS on interest on FDRs on deposits beyond the threshold limit of Rs. 10,000/- as so prescribed under Section 194A of the Act and accordingly the assessee was held to be assessee in default under section 201 resulting in passing of the order under section 201 r.w.s. 201(1A) dt. 31/03/2018 raising the demand of tax and interest amounting to Rs. 16,79,223/-

3.

Separately, the matter was referred by the AO to the JCIT for initiating the penalty proceeding under section 271C of the Act for failure to deduct tax at source and thereafter, the penalty order was passed by the JCIT under section 271C r.w.s 274 dt. 02/07/2018 stating that the assessee has nothing to explain in support of its claim for non deduction of tax at source and therefore assessee was held liable for imposing of penalty under section 271C of the Act.

4.

Both these orders were challenged before the Ld. CIT(A) and on perusal thereof, we find that the same has been passed ex-parte qua the assessee and against which, the assessee is in appeal before us.

5.

During the course of hearing, the Ld. AR submitted that the order passed by the AO under section 201(1) r.w.s 201(1A) is barred by limitation as the same has been passed on 31/03/2018 beyond the prescribed limitation period and in support, reliance was placed on the Coordinate Bench decision in case of Reebok India Company C/O Price Water House Coopers Pvt. Ltd. Vs. The JCIT(OSD), New Dehi in dt. 15/11/2021. It was accordingly submitted that the order so passed by the AO deserves to be set aside at very threshold as the same is barred by limitation.

6.

The Ld. DR is heard who has submitted that no such ground of appeal has been taken by the assessee before the lower authorities and in any case, there is no finding by the Ld. CIT(A) and therefore where the Bench so decide, he matter may be set aside to the file of the Ld. CIT(A) to decide the same.

7. After hearing both the parties and considering the fact that the assessee has not been provided proper opportunity and the order has been passed ex-parte by the ld CIT(A), we deem it appropriate that the assessee deserve an opportunity to represent its case before the ld CIT(A) and we also have the benefit of the findings of the ld CIT(A) and thus, the matter required to be set aside to the file of the Ld. CIT(A).

8. As far as the ground relating to limitation, no doubt, no such ground was specifically taken before the Ld. CIT(A). At the same time, the same being the legal ground, the same is hereby admitted and since we are setting aside the matter, this ground is also set aside to the file of the Ld. CIT(A) to decide the same after providing reasonable opportunity to the assessee.

9. In light of the above, the appeal in respect of levy of penalty under section 271C is also set aside to the file of the Ld. CIT(A) to decide the same afresh after providing reasonable opportunity to the assessee.

10. In the result, both the above appeals of the Assessee are set-aside to the file of the ld CIT(A) and the same are allowed for statistical purposes.

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