TMI Blog2017 (10) TMI 526X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee is allowed. - In ITA No. 6052/Del/2014, In ITA No. 6044/Del/2014, In ITA No. 6049/Del/2014, In ITA No. 6050/Del/2014, In ITA No. 6053/Del/2014, In ITA No. 6047/Del/2014, In ITA No. 6045/Del/2014, In ITA No. 6046/Del/2014, In ITA No. 6054/Del/2014 - - - Dated:- 13-9-2017 - SHRI O.P. KANT, ACCOUNTANT MEMBER AND SHRI AMIT SHUKLA, JUDICIAL MEMBER ITA No. 6051/Del/2014 And In ITA No. 6048/Del/2014 For The Assessee : Shri B.R. Nimwal, (Officer of the Bank) For The Revenue : Shri R.C. Danday, Sr. DR. ORDER PER BENCH: These aforesaid appeals have been filed by the assessee against separate impugned orders passed by the Ld. CIT (Appeals), Ghaziabad of even date 14.08.2014, in relation to the proceedings u/s 201(1) and 201(1A) r.w.s. 254 for the Assessment Years 2002-03, 2003-04 and 2004-05. Since the issues involved in all the appeals are common arising out of the identical set of facts, therefore, same were heard together and are being disposed off by way of this consolidated order. 2. For the sake of proper appreciation of facts and issues, the appeal for the A.Y. 2002-03 in ITA No. 6052/Del/2014 are discussed and the findings given t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1 2001-02 1,56,032 15,915 2 2002-03 24,87,277 2,61,164 3 2003-04 31,71,966 38,064 This information was obtained by the Assessing Officer u/s 133(6) and without issuing any show cause notice and any proceeding been conducted in the cases of deductee-assessees had treated the assessee as assessee-in-default . The Assessing Officer relying upon the CBDT s circular no. 715 dated 8.8.1995, held that the assessee should have deducted tax at source on the interest at the time of deposits and the Flexi Fixed Deposit Scheme is a kind of time deposit and therefore, the assessee was liable for tax u/s 201(1) read with section 194(A). 3. This mater in the original proceedings had travelled up to the stage of the Tribunal, wherein, Tribunal vide order dated 2.2.2007, at the first instance dismissed the assessee s appeal for want of COD approval. However, later on, in the Miscellaneous Application filed by the assessee the said order was recalled and in the final order the Trib ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ranch, exactly similar issue has been dealt and decided by the Tribunal in favour of the assessee vide order dated 4.3.2016 in ITA Nos. 5992, 5993, 5944/Del/2012. Thus, the issue involved is squarely covered by the decision of the Tribunal. 6. On the other hand the Sr. DR strongly relied upon the order of the Assessing Officer and the Learned CIT (Appeals) and submitted that there was a statutory mandate upon the assessee to deduct the tax at source on the interest payment accrued to the payee on Flexi Fix Deposits and failure to do so definitely amounts to assessee being treated as assessee in default and therefore, tax u/s 201(1) and interest u/s 201(1A) has rightly been levied. 7. We have heard both the parties and also perused the relevant materials on record. First of all, from the perusal of the impugned order, it is seen that the Learned CIT (Appeals) has held that the appeal of the assessee is not maintainable as there is a delay in filing of the appeal but at the same time he has proceeded to decide the appeal on merits. Once the appeal is dismissed on account of delay then there was no occasion or point to decide the appeal on merits and if the appeal has been dec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted can be realised from the deductor. No such provision is made under section 201 obviously because the liability to pay Income-tax is on the assessee directly in whose case, the tax has not been deducted. 9. If we apply the aforesaid principle of the Hon'ble High Court on the facts of the present case, we find that the Assessing Officer has nowhere given any finding that the deductee/assessee has failed to pay taxes directly and without such finding the Assessing Officer cannot treat the deductor that is, the present assessee as assessee- in-default. This precise issue has been dealt by the Tribunal in the case of Allahabad Bank only for the same assessment year on similar set of facts wherein the Tribunal has observed and held as under:- Though the impugned order of the AO is after the direction of ITAT, we take note that Hon ble jurisdictional High Court (Allahabad High Court) has settled the law, in respect to the issue before us in the case of M/s. Jagran Prakashan Ltd. vs. DCIT 345 ITR 288 (All) held as under:- .. it is dear that deductor cannot be treated an assessee in default till it is found that assessee has also failed to pay such tax direc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion is satisfied. No doubt the assessee has to submit ail such information about the recipient as he is obliged to maintain under the law, once this information is submitted it is for the Assessing Officer to ascertain whether or not the taxes have been paid by the recipient of income, 'This approach, in our humble understanding, in consonance with the law la id down by Hon ble Allahabad High Court. From a reading of the Assessing Officer s order, it is clear that the Assessing Officer has not made any exercise to ascertain whether the deductee/payee assessee has failed to pay any tax directly before initiation of proceedings u/s 201/201(1A) of the Act, thus assumption of jurisdiction itself stands vitiated and all subsequent proceedings are in the eyes of law. Therefore, we quash the initiation of proceedings of the Assessing Officer at the outset itself. The AO ought to have assumed jurisdictional fact as laid by the Hon'ble High Court which as stated before is obviously absent. So, we quash the impugned assessments itself. 10. Thus, respectfully following the Coordinate Bench s decision in the case of the assessee itself, we hold that the proceedings u/s 201 ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
