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TMI Blog2016 (4) TMI 244X X X X Extracts X X X X X X X X Extracts X X X X ..... r not accepting form No.27C for the sale of scrap amounting to Rs. 1,57,60,687/- and treating the assessee in default u/s 206C(6A) of the Act by not applying provisions of section 206(1A) of the Act. 2. Briefly stated facts as culled out from the records are that the assessee is a partnership firm engaged in the business of ship breaking. It filed its return of income for Asst. Year 2006-07 on 10/10/2006 declaring total income at Rs. 4,97,460/- along with tax audit report. It was observed by the Assessing Officer that as per provisions of section 206C every person shall at the time of debiting the amount payable by the buyer to the account of the buyer or at the time of receipt of such amount in the said buyer in cash or by the issue of a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... T(A), who further examined form no.27C for scrap sales for Rs. 3,10,81,253/- received from the buyers and allowed the claim of the assessee for 0% TCS on sales of Rs. 1,53,20,566/- on the basis of form no.27C submitted by the assessee and for the remaining sales of Rs. 1,57,60,687/- confirmed the addition made by the Assessing Officer by giving a reason for denying the claim of the assessee that out of the total 24 forms relevant to sales of Rs. 1,57,60,687/- in 19 cases no date was mentioned in part-I and in two cases there was some over writing and in one case each there was no data and wrong date mentioned. 5. Aggrieved, assessee is now in appeal before the Tribunal. 6. The ld. AR of the assessee submitted that form no.27C are being pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essee had filed the declaration from the buyer, as mandated in section 206C(1A) only ITA No.1153/Bang/2014 Dr.Hajjaji Krishnamurthy Anand Page 6 of 9 when show cause notices were issued by the AO, pointing out failure to collect tax at source. However, it remains a fact that assessee had produced Form No.27C obtained from both the parties. Copies of these Forms have been placed on record at paper book pages 1 to 66. Both Part I and Part II of the Forms have been filled up. At this juncture, it is necessary to have a reading of section 206C(1A), 206(1B) and rule 37C which prescribed Form 27C. "206C. Profits and gains from the business of trading in alcoholic liquor, forest produce, scrap, etc.- (1) Every person, being a seller shall, at th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mmediately before the 1st day of June, 2003, a sum equal to the percentage, specified in the corresponding entry in column (3) of the said Table, of such amount as income-tax in accordance with the provisions of this section as they stood immediately before the 1st day of June, 2003. (1A) Notwithstanding anything contained in sub-section (1), no collection of tax shall be made in the case of a buyer, who is resident in India, if such buyer furnishes to the person responsible for collecting tax, a declaration in writing in duplicate in the prescribed form2 and verified in the prescribed manner to the effect that the goods referred to in column (2) of the aforesaid Table are to be utilised for the purposes of manufacturing, processing or pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... inate" 9. Section 206C(1A) mandates that any person responsible for collecting tax under section 206C(1) need not do so if he obtains a declaration from the buyer that he is purchasing the goods for use in manufacturing, processing or producing articles or things. It does not say that such declaration has to be obtained at the very same moment when a sale is affected. A reading of sub section (1B) clearly brings out this since obligation of the assessee to file a copy of the declaration arises only when the declaration is furnished to him by the buyer. The point of reference is furnishing of declaration by the buyer and not the month or date on which sale is affected by the assessee. Even if we consider that there is a breach on the part ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for the sales of Rs. 1,57,60,687/- and there is a list of 24 parties shown in the order of ld. CIT(A) at para 5.3 and out of 24 parties in 19 cases column of date shown in part-I is not filled and in the remaining six cases either there is a minor overwriting in the form or wrong date is mentioned. But the fact remains that all the declarations are duly signed, all the necessary details of purchase made by the buyers are correctly entered, details mentioned by the buyers have been duly verified by the assessee and most importantly the figures shown by the buyers in the declaration are duly reflected in the sales account of the assessee which is part and parcel of the audited financial statements and not a single mistake in the above facts h ..... X X X X Extracts X X X X X X X X Extracts X X X X
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