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Income Tax Appellate Tribunal, BENCH, NAGPUR
Before: SHRI RAVISH SOOD & SHRI JAMLAPPA D BATTULL
आदेश / ORDER PER RAVISH SOOD, JM : The present appeal filed by the assessee is directed against the order passed by the CIT(Appeals)-1, Nagpur, dated 31.01.2017, which in turn arises from the order passed by the A.O u/s. 143(3) of the Income-tax Act, 1961 (for short ‘the Act’), dated 25.02.2015 for assessment year 2012-13. Before us the assessee has assailed the impugned order on the following grounds of appeal:
“1. The order passed by the learned AO and confirmed by Honourable CIT(A) is incorrect, bad in law and without natural justice. 2. The addition made of Rs.2,41,749/- levied on appellant is incorrect, bad in law and without justice and the same is to be deleted. 3. The computation of income is to be corrected as per carried forwarded losses to NIL. 4. Appellant craves a right to add, modify, alter or withdraw and of the ground/s of appeal during the course of hearing.”
At the very outset of the hearing of the appeal, it was submitted by the Ld. Authorized Representative (for short ‘AR’) for the assessee that the appeal involves a delay of 29 days. Elaborating on the reasons leading to the said delay, it was submitted by the Ld. AR that as the
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assessee at the relevant point of time was engrossed in obtaining a certificate in Form 26A from a Chartered Accountant i.e, evidencing that the interest amount in question was duly included by the payee in its return of income and the corresponding taxes on the same deposited, which fact would absolve him of the disallowance contemplated u/s. 40(a)(ia) of the Act, therefore, inadvertently and on account of a bonafide mistake the delay of 29 days had crept in filing of the appeal by him. It was submitted by the Ld. AR that as the delay had occasioned for bonafide reasons, therefore, the same in all fairness may be condoned.
2.1 Per contra, the Ld. Departmental Representative (for short ‘DR’) objected to seeking of condonation of delay by the assessee.
2.3 We have given a thoughtful consideration, and are of the considered view, that in the backdrop of the bonafide reasons which had led to the delay in filing of the present appeal by the assessee, the same merits to be condoned.
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Succinctly stated, the assessee company had filed its return of income for the assessment year 2012-13 on 26.09.2012, declaring an income of Rs. Nil. The return of income filed by the assessee was processed as such u/s. 143(1) of the Act. Subsequently, the case of the assessee was selected for scrutiny assessment u/s. 143(2) of the Act.
Observing, that the assessee had paid interest of Rs.2,41,749/- to M/s. Tata Motors Finance Ltd. without deducting tax at source on the said amount, the Assessing Officer disallowed the same u/s. 40(a)(ia) of the Act.
Aggrieved, the assessee assailed the assessment order before the CIT(Appeals), but without any success.
The assessee being aggrieved with the order of the CIT(Appeals) has carried the matter in appeal before us.
At the very outset of the hearing of the appeal, it was submitted by the Ld. AR that as the payee, viz. Tata Motors Finance Ltd, had
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taken into account the aforesaid interest charges of Rs.2,41,749/- (supra) in its return of income for the year under consideration i.e. A.Y. 2012-13 and had paid the corresponding taxes on the same, therefore, the assessee as per the “first proviso” to Section 201(1) of the Act could not be held as an “assessee-in-default” as regards the said amount. Backed by his aforesaid contention, it was submitted by the Ld. AR that now when the assessee could not be held as an assessee- in-default under the “first proviso” to sub-section (1) of Section 201 of the Act, then, as per the “2nd proviso” to Section 40(a)(ia) of the Act, no disallowance under the said statutory provision could have been made in the hands of the assessee. In order to buttress his claim that the aforesaid amount of interest paid by the assessee company was included by the payee, viz. Tata Motors Finance Ltd in its return of income, a/w payment of the corresponding taxes on the same, the Ld. AR had taken us through the certificate in the prescribed Form-26A, dated 03.05.2017 that was obtained by the assessee from a Chartered Accountant. It was submitted by the Ld. AR that as the aforesaid certificate had been obtained by the assessee after culmination of the
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proceedings before the lower authorities, therefore, the same had been filed as an ‘additional evidence’. It was submitted by the Ld. AR that as the aforesaid certificate goes to the very root of the issue under consideration, therefore, the same in all fairness may be admitted.
Per contra, the Ld. DR relied on the orders of the lower authorities.
Regarding the admissibility of the ‘additional evidence’, we find that as the certificate in the prescribed Form-26A, dated 03.05.2017 filed by the assessee before us goes to the very genesis of the controversy involved in the present appeal, therefore, in all fairness we admit the same.
We have heard the Ld. Authorized Representatives of both the parties, perused the orders of the lower authorities and the material available on record. Admittedly, it is a matter of fact borne from the record that the assessee had failed to deduct tax at source on the amount of interest of Rs.2,41,749/- (supra) that was paid by it to M/s.
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Tata Motors Finance Ltd. However, as the aforesaid payee, viz. Tata Motors Finance Ltd had duly taken into account the aforementioned amount of interest while computing its income for the year under consideration and had paid the corresponding taxes on the same, as is evidenced from the certificate of the Chartered Accountant in Form 26A, dated 03.05.2017 filed by the assessee before us, therefore, we are of the considered view, that as stated by the Ld. AR, and rightly so, the assessee could not be held as an assessee-in-default as regards the aforementioned amount under Section 201(1) of the Act. Accordingly, now when the assessee could not be held as an assessee- in-default u/s. 201(1) of the Act, therefore, we concur with the claim of the Ld. AR that as per the “2nd proviso” to Section 40(a)(ia) of the Act, the aforementioned amount could not have been disallowed in the hands of the assessee company. Backed by our aforesaid deliberations, we, herein, set-aside the order of the CIT(Appeals) and direct the Assessing Officer to vacate the disallowance of Rs.2,41,749/- (supra) made in the hands of the assessee company.
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In the result, appeal of the assessee is allowed in terms of our aforesaid observations.
Order pronounced in open Court on 05th day of April, 2022.
Sd/- Sd/- JAMLAPPA D. BATTULL RAVISH SOOD (ACCOUNTANT MEMBER) (JUDICIAL MEMBER) रायपुर/ RAIPUR ; �दनांक / Dated : 05th April, 2022 SB आदेश क� ��त�ल�प अ�े�षत / Copy of the Order forwarded to : अपीलाथ� / The Appellant. 1. ��यथ� / The Respondent. 2. 3. The CIT(Appeals)-1, Nagpur. 4. The CIT-1, Nagpur. 5. �वभागीय ��त�न�ध, आयकर अपील�य अ�धकरण, नागपुर/ DR, ITAT, Nagpur. गाड� फ़ाइल / Guard File. 6. आदेशानुसार / BY ORDER, // True Copy // �नजी स�चव / Private Secretary आयकर अपील�य अ�धकरण, रायपुर / ITAT, Raipur.
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Date 1 Draft dictated on 23.03.2022 Sr.PS/PS 2 Draft placed before author 23.03.2022 Sr.PS/PS 3 Draft proposed and placed JM/AM before the second Member 4 Draft discussed/approved by AM/JM second Member 5 Approved draft comes to the Sr.PS/PS Sr. PS/PS 6 Kept for pronouncement on Sr.PS/PS 7 Date of uploading of order Sr.PS/PS 8 File sent to Bench Clerk Sr.PS/PS 9 Date on which the file goes to the Head Clerk 10 Date on which file goes to the A.R 11 Date of dispatch of order