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2015 (11) TMI 1263 - ITAT AHMEDABAD

2015 (11) TMI 1263 - ITAT AHMEDABAD - TMI - TCS u/s 206C - Non compliance of provisions of Section 206C - failure to deduct TDS - CIT(A) deleting order passed u/s. 201(1) and interest thereon u/s. 201(1A) - Held that:- "Waste and scrap" are one item. The “waste and Scrap" must be from manufacture or mechanical working of material which is definitely not usable as such because of breakage, cutting up, ware and to other reasons. It would mean that these waste and scrap being one item should arise .....

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tute sizable chunk of production done by ship breakers. Though such products may be commercially known as "scrap" they are definitely not "waste and scrap". The items in question are "usable as such" and therefore does not fall within the definition of scrap as given in of section 206C(1). Having said so, we restore the issue to Assessing Officer with direction to grant relief to assessee under the provision of 206C(1) of Act, with regards to only sale of scrap arising out of manufacturing activ .....

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eals)-XXI, Ahmedabad, dated 27.06.2011 for A.Y. 2006-07 on the following ground: 1. The Ld.CIT(A) has erred in law as well as on facts of the case in deleting the order passed u/s.201 (1) of the I.T. Act of ₹ 40,16,418/- and interest charge under section 201 (1A) of the I.T. Act of ₹ 23,29,522/- even though the decision relied upon by the CIT(A) i.e. Navin Flourine International Ltd. is not applicable to the facts of this case as products in the both the cases are well distinguishabl .....

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provides that if the seller does not collect tax or after collecting the tax fails to pay it, he shall be liable to pay simple interest at 1% from the date on which such tax was collectible to the date on which the tax is actually paid off. For non compliance of provisions of Section 206C of the Act r.w. Rule 37C of the Income Tax Rules, 1961, assessee was liable to pay tax and interest thereon. A show cause notice was issued on 16.09.2010 which was returned by Postal Authority with remarks LEF .....

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18/- and interest thereon u/s. 201(1A) of ₹ 23,29,522/-. Above decision relied by CIT(A) i.e. Navine Flrorine International Ltd. vs. ACIT, TDS Circle, Surat was not applicable to the facts of this case as product in both cases were well distinguishable. Accordingly, requested to set aside the order of CIT(A) and restore that of Assessing Officer on the issue. On other hand, learned Authorized Representative supported the order of CIT(A). 2.2 After going through rival submissions and materi .....

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and liable to pay penalty of ₹ 40,16,418/- u/s. 201(1) of the Act and interest of ₹ 23,29,522 u/s. 201(1A) of the Act. The provision of Section 201 of the Act reads as under: 201. of income-tax Act: Consequences of failure to deduct or pay. (1) Where any person, including the principal officer of a company,- (a) who is required to deduct any sum in accordance with the provisions of this Act, or (b) referred to in sub-section (1A) of section 192, being an employer, does not deduct, or .....

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.... (3) No order shall be made under sub-section 11) deeming a person to be an assessee in default for failure to deduct the whole or any part of the tax from a person resident in India, at any time after the expiry of- (i) two years from the end of the financial year in which the statement is filed in a case where the statement referred to in section 200 has been fifed; (ii)four years from the end of the financial year in which payment is made or credit is given, in any other case: Provided th .....

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GM, GUM, COP, GER.ALU.PRO Assessee has not collected TCS on following type of items sold during the year: 1. Old & used plates 2. Non-excisable (exempted) like furniture, wood, etc. 3. Trading of scrap (melting) 4. High seas sale We find that ITAT B Bench, Ahmedabad in ITA Nos. 1213 and 1214/Ahd/2010 dated 15.02.2011 in case of Navine Fluorine International Ltd Vs. ACIT, TDS Circle Surat, for A Y 2009-10 & 2010-11, inter alia held that term "waste and scrap" are one item. The w .....

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