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2019 (10) TMI 252 - ITAT KOLKATANon collection of TCS from the mining companies - ignorance of statutory provisions requiring TCS collection - HELD THAT:- Our attention has been invited to the assessee’s categorical explanation in the lower proceedings that the state government had not issued any instructions regarding TCS collection in case of receipts coming from mining companies. We find merit in learned departmental representative’s argument in principle. There is hardly any dispute that legislature has prescribed TCS collection u/s. 206(1C) @ 2% regarding mining and quarry lincence or lease etc., at the time of receipt of the specified sums. We therefore observe that the mere fact that the state government had not issued any instructions to the field authorities regarding compliance of the impugned statutory provision does not carry any merit since ignorance of law by either the government or its agency is exercising various statutory functions cannot be accepted as a justifiable reason. We therefore concur with the Revenue’s argument supporting the Assessing Officer as well as CIT(A)’s action raising the impugned demands in assessee’s case since he had not collected TCS from the mining companies. Benefit of sec. 206C(6A) first proviso inserted by the Finance Act, 2012 with effect from 01.07.2012 - The legislature had instituted the aforesaid proviso in the Act vide Finance Act, 2012 with effect from 01.07.2012 in sec. 201(1) of the Act to be applicable in case of TDS deductor at the time of his assessment u/s. 40(a)(ia) vide second proviso inserted by the Finance Act, 2012 with effect from 01.04.2013. And also that various recent judicial precedents in Ansal Landmark Township [2015 (9) TMI 79 - DELHI HIGH COURT] and PCIT vs. Perfect Circle India Pvt. Ltd. [2019 (1) TMI 1532 - BOMBAY HIGH COURT] and tribunal’s coordinate bench’s orders hold that the aforesaid proviso carries retrospective effect being curative in nature. We observe that the very line of reasoning also deserves to be adopted qua application of sec. 206A (first proviso) as well inserted by the Finance Act, 2012 with effect from 01.07.2012 to this effect as applicable in case of TCS collection than TDS deduction. We therefore decline the Revenue’s instant technical argument that the foregoing proviso to sec. 206C(6A) does not carry any retrospective operation and leave it open for the Assessing Officer to verify all necessary facts about the assessee’s payers to have been assessed qua the very income under the provision of the Act. The assessee is directed to place on record all necessary documents in consequential proceedings within three effective opportunities of hearing to assessee. Assessee's appeal allowed for statistical purposes.
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