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ITO (TDS) , Moradabad and others Versus Life Insurance Corporation of India and Others and vica-Versa

2015 (11) TMI 1132 - ITAT DELHI

Levy of fee u/s 234E while processing the TDS statement - Intimation u/s 200A - Delay in filing of TDS returns - short deduction, Short Payment, and late payment and interest thereon - Held that:- Late fee for delay in filing return of tax deducted at source (TDS) u/s 234E of the Act cannot be raised while processing the TDS statement, by way of intimation u/s 200A of the Act. Thus, the intimations issued by the Assessing Officer u/s 200A of the Act are set aside to the extent of levy of fee u/s .....

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a, Hon ble Vice President And Sh. O.P.Kant, Accountant Member For The Appellant : Sh. Sujit Kumar, Sr. DR, Sh. Zain Raja, Adv, Sh. Manoj Kumar, CA, Sh. Anil Jain, Adv. For The Respondent : Sh. Sujit Kumar, ORDER PER BENCH. This batch of seven appeals comprises two appeals of the Revenue and five appeals of the tax deductors. All the appeals emanate from the different orders of the learned Commissioner of Income-tax (Appeals) against the intimation issued u/s 200A of the Act by the Income Tax Off .....

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appeals of ITA No. 1930 are only reproduced as under: 1. The ld. CIT(Appeals), Bareilly has erred in facts and law by accepting new evidence from the deductor without allowing reasonable opportunity to the AO in terms of Rule 46A(3) of the IT Rules, 1962. The deductor submitted before the CIT(A) that he has deducted and paid the due tax and that short deduction/ non-payment is due to mismatch. This fact was not neither produced before the AO nor it was reflected on the ITD System when this orde .....

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he AO has no power to revise the order. The only remedy for the deductor is to file correction statement on-line and get the demand reduced through CPC (TDS). 3. The CIT(A) being a quasi-judicial body has erred further in directing the AO(TDS) to carry out rectifications without understanding the process of rectification/ corrections laid down by CPC (TDS). No proof has been submitted by the deductor before the CIT(A) to show that the necessary correction statement have been filed with CPC(TDS). .....

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AO(TDS) order stands, and cannot be cancelled. 3. The facts in brief in the appeals are that quarterly returns of tax deducted at source (TDS) for the financial year 2009-10 were filed by the branch of Life Insurance Corporation of India, located at Amroha (Uttar Pradesh), as deductor. These returns were processed by the ITO (TDS), Moradabad and an intimation u/s 200A of the Act was issued on 09/08/2011 raising a sum payable towards short deduction, Short Payment, and late payment and interest .....

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ssary verification and pass suitable orders. Against the orders of the learned commissioner of Income-tax (Appeals), the Revenue has preferred these appeals. 4. At the outset of hearing, the learned Authorised Representative appeared on behalf of one the appellant in batch of cases heard, brought to our notice that no appeal under section 246A of the Income-tax Act was maintainable before the commissioner of Income-tax (Appeals) against the intimation issued u/s 200A of the Act prior to 01.07.20 .....

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00A has been issued on 09/08/2011, which is prior to 01/07/2012 i.e. the date from when the intimation u/s 200A has been made appealable before the commissioner of Income-tax (Appeals) under 246A of the Act. In view of the facts, the decision is squarely applicable in present appeals before us. In the decision of the ITO Ward 50(4) Vs. Maruti Insurance Agency Network Ltd and others (supra), the Tribunal has followed the findings given by the Tribunal in the case of ACIT Vs. Unitech Wireless (Tam .....

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ellant. There is no appeal provision u/s. 246A of the I.T. Act for filing appeals against order u/s. 200A of the I.T. Act. The appellants are advised to file necessary corrections statements before the AO (TDS), coordinate and cooperate with the Assessing Officer and rectify the order u/s. 200A/154 of the I.T. Act with the Assessing Officer and after rectification, pay the tax and interest if any, after rectification. The AO (TDS) should give appeal effect to these orders within 2 months of rece .....

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n the impugned orders are analyzed, there is direction/ advice by the Ld. Commissioner of Income Tax (A) to file correct statement before the Assessing Officer(TDS), after providing due opportunity of being heard to the assessee. In view of the above, we are of the considered opinion that the Revenue should not feel aggrieved, as the ultimate purpose is to do justice. Even otherwise, no person should be condemned unheard and the Ld. Commissioner of Income Tax (A) has merely remanded the issue ba .....

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as directed by the Ld. Commissioner of Income Tax (A), is withdrawn. However, the Assessing Officer is directed to complete within reasonable time/as soon as possible. 7. Finally, subject to the above rider, all the appeals of the Revenue stand dismissed. 5. Relying on the above findings, the Tribunal in the case of ITO, Ward 50(4) Vs. Maruti Insurance Agency Network Ltd. and Others (supra) has held has under:- 5. Since, the issue involved in these cases is covered by the decision of the Tribuna .....

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bunal in the case of ITO Ward 50(4) Vs. Maruti Insurance Agency Network Ltd and others( supra), following the above order , we dismiss the appeals of the Revenue and direct the ITO( TDS) to follow the directions contained in the decision of the Tribunal in the case of ITO Ward 50(4) Vs. Maruti Insurance Agency Network Ltd and others (supra). 7. In the result, both the appeals of the Revenue are dismissed. 8. Now we take up the Appeal of the deductor in ITA No. 2605 & 2606/Del/2104. The groun .....

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Appellant prays that it is held that the appeal against intimation u/s. 200A of the Act is maintainable under Section 246A of the Act. Ground II: Non Applicability of Section 206AA 1. On the facts and in the circumstances of the case and in law, the CIT(A) erred in not holding that in cases where tax at source is deductible under section 195 of the Act on payments made to the residents of foreign country with which India has entered into a Double Taxation Avoidance Agreement (DTAA) and the rate .....

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ves leave to add to, alter and/or amend all or any of the foregoing grounds of appeal. 9. The facts in brief in the appeals are that quarterly returns of tax deducted at source (TDS) filed by the deductor were processed by the ITO (International Taxation), Ward-1, New Delhi and an intimation u/s 200A of the Act was issued on 03/11/2011 in case of both the returns raising a sum as payable towards short deduction and interest thereon as under : ITA No Financial Year Quarter Date of filing Form No. .....

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, challenging tax deduction at the rate of 20 per cent. prescribed u/s 206AA of the Act on payments to nonresidents due to non availability of Permanent Account number. Before the learned commissioner of Income-tax (Appeals), the deductor claimed that as per section 90(2) of the Act, where a treaty has been entered into with a foreign Country, the provisions of the Income-tax Act shall apply to the extent more beneficial to the non- resident and hence the deductor had correctly deducted tax at t .....

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lant. Against the order of the learned commissioner of Income-tax (Appeals), the Revenue has preferred these appeals. 11. At the outset of hearing, the learned Authorised Representative appeared on behalf of one the appellant in batch of cases heard, brought to our notice that no appeal under section 246A of the Income-tax Act was maintainable before the commissioner of Income-tax (Appeals) against the intimations issued prior to 01.07.2010 as held by the Income-tax Appellate Tribunal , E Bench .....

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ons u/s 200A have been issued on 03//11/2011, which is prior to 01.07.2012 i.e. the date from when the intimation u/s 200A has been made appealable before the commissioner of Income-tax (Appeals) under 246A of the Act. In view of the facts, the decision is squarely applicable in present appeals before us. The learned commissioner of Income-tax (Appeal) has already relied on the decision of Tribunal in the case of ACIT Vs. Unitech Wireless (Tamilnadu) Pvt. Ltd and others in ITA Nos. 4028-4049 &am .....

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peal is maintainable u/s 246A to the Commissioner of Income-tax (Appeal) against the intimation issued u/s 200A of the Act by the ITO on 03/11/2011 in the case of the deductor. Accordingly, the first ground raised in the appeals is dismissed. As the appeals have already been held as non maintainable, the second ground raised is held as infructuous and dismissed. The third ground being general no adjudication is required and hence dismissed. 12. In the result, both the appeals of the deductor are .....

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of section 234E of the Act while processing the return and intimated to the deductor in intimation issued u/s 200A of the Act. The learned Commissioner of Income-tax (Appeals) has upheld the action of the AO in including the penalty leviable u/s 234E of the Act in the intimation issued u/s 200A of the Act. Aggrieved the deductors appellants, have filed appeal before us. 15. At the outset of hearing, the learned Authorised Representative of the one of the appellant deductor submitted that the iss .....

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ation is an appealable order under s. 246A(a), and, therefore, the CIT(A) ought to have examined legality of the adjustment made under this intimation in the light of the scope of the s. 200A. Learned CIT(A) has not done so. He has justified the levy of fees on the basis of the provisions of s. 234E. That is not the issue here. The issue is whether such a levy could be effected in the course of intimation under s. 200A. The answer is clearly in negative. No other provision enabling a demand in r .....

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in 245 ITR (Trib) 439 (Chennai) has held as under:- In view of the above discussion, this Tribunal is of the considered opinion that the Assessing Officer has exceeded his jurisdiction in levying fee under section 234E while processing the statement and making adjustment under section 200A of the Act. Therefore, the impugned intimation of the lower authorities levying fee under section 234E of the Act cannot be sustained in law. However, it is made clear that it is open to the Assessing Officer .....

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