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2019 (5) TMI 303 - HC - Income TaxAddition u/s.40(a)(ia) - TDS u/s 194C - purchase or job work - major part of the materials viz., Gold and Nickel for undertaking the job work was purchased only by M/s.Spectronic Plating (P) Ltd., from the third parties and not from the Assessee and therefore composite Invoice was raised charging sales tax - duty of appellate authority - HELD THAT:- CIT (Appeals) has not at all answered to the contentions raised before him and has not especially not dealt with the exclusion part in the Explanation to Section 194C; whether the said Section applies to the present case or not, in view of the definition 'Work' as defined in the Explanation to Section 194C, where apparently the material used for electroplating viz., Gold and Nickel were purchased by the job worker M/s.Spectronic Plating Pvt., Ltd., Bangalore from third parties and for which a composite Sale Invoice consequent to the Purchase Order of the Assessee was raised, and in respect of the same, then property in goods has been transferred to the Assessee along with job work charges of electroplating undertaken by the said Company. Whether such works would attract the provisions of Section 194C or not was a debatable question and unless a finding of fact was arrived at by the CIT (Appeals) independently discussing the contentions raised before him, the mere affirmation of the finding of the Appellate Authority that provisions under Section 194C are attracted and that the Assessing Officer was justified in making disallowance to the extent of ₹ 2,76,67,052/- is not at all a satisfactory disposal of the Appeal by the First Appellate Authority, who was under an obligation to discuss the facts and legal contentions in detail and the FAA cannot affirm the order passed by the lower Assesseing Authority just like that. The Tribunal is also equally duty bound to discuss the facts and legal contentions in detail. Cutting short their findings by merely affirming the order of the lower Appellate Authority, shows total non-application of mind and the failure to discharge their legal duty provided under the Act. Assessing Authorities are adopting a pro-revenue approach to raise demands of tax, interest and penalty, perhaps to fetch more revenue to the coffers of the Treasury, but at the same time, we cannot ignore the legal rights of the Assessees to raise its contentions. Therefore, it is incumbent on the part of the appellate forums, to thrash out the facts and legal contentions, with the aid of statutory provisions discussed in detail as may be canvassed before them, under the Income Tax Act - we are constrained to remit the matter back to the learned CIT (Appeals) for passing fresh orders in accordance with law, after dealing with the contentions of the Assessee in an appropriate, fair and objective manner by proper application of mind.
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