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TMI Blog2021 (2) TMI 282X X X X Extracts X X X X X X X X Extracts X X X X ..... are against the order passed by the Dy.Commissioner of Income Tax (IT) u/s 201(1A) of the Income Tax Act, 1961 (in short 'Act') for charging interest of Rs. 42,83,249/- and sustained by the Ld. CIT(A). 3. Brief facts of the case are that Dy.Commissioner of Income Tax (International Taxation)(in short 'AO)' was having information regarding purchase of immovable property by the assessee, M/s Sravan Shipping Services Private Ltd., admeasuring 3.4 acres situated in Survey No.242/SC, 4B, 5,6, A to E in Pedagantyada, Visakhapatnam for a consideration of Rs. 2,71,90,000/- from Smt.Gudla Kavitha, non-resident vide document No.1343/2010, registered on 24.04.2010 before the sub Registrar, Pedagantyada, Visakhapatnam. The AO has verified the status o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reasons mentioned in his order as under: a) In point a, the AR of the assessee stated that the assessee had not entered into agreement directly with non-resident but with his representative Sri T. Nagi Reddy, who was an Indian resident. But, in this case the assessee, nonresident herself has signed the sale deed and power attorney was not given to any person. b) In point b, the AR of the assessee stated that the provisions of section 195 apply only when any remittance is required to be made to any foreign country. But, section 195 of the act clearly says that any person responsible for paying to a non- resident, at the time of credit of such income to the account of the payee or at the time of payment thereof in cash or by the issue of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ision of this Tribunal in the case of Sri Malla Appala Naidu and others in I.T.A. No.547-550/Viz/2017 dated 12.10.2018, the Tribunal held that four years as reasonable time for passing the order u/s 201(1A) in the case of NRI and the proceedings initiated beyond four years are held to be barred by limitation. 7. The Ld.DR supported the order of the lower authorities. 8. We have heard both the parties and perused the material placed on record. The Ld.AR relied on the decision of this tribunal cited supra on identical issue. The Tribunal in the case of Sri Malla Appala Naidu (supra) considered that four years as reasonable time and the proceedings initiated beyond four years are held to be barred by limitation. While delivering decision, IT ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1(1A) and held that 4 years is the reasonable time for initiating proceedings u/s 201/201(1A). While holding so, the Hon'ble High Court has relied on the decision of CIT Vs. NHK Japan Broadcasting Limited [305 ITR 137] and the CIT Vs. Hutchison Essar Telecom. Limited [323 ITR 330], Further, Hon'ble Delhi High Court has considered amendment made to Section 201 of the Act vide Finance Bill, 2009 and viewed that the Parliament did not make any amendment to the time limits for the non residents which indicates that the Parliament has accepted the judicial pronouncements for the limitation period already set out by the courts. The Hon'ble Delhi High Court also considered the decision of Hon'ble Supreme Court in the case of GE India Technology Ce ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... time limit for initiating the proceedings u/s 201 and 201(1A) is 4 years and it is barred by limitation. Therefore, following the decision of Hon'ble Delhi High Court, we are unable to sustain the orders of the lower authorities. Accordingly, the order passed u/s 201 / 201(1A) is set aside and the appeal of the assessee is allowed." In the instant case, the transaction took place on 24.04.2010 i.e. in the financial year 2010-11 and the AO passed the order on 22.03.2018 by issue of notice u/s 195 on 18.09.2017. Thus, the action taken by the AO was more than six years from the end of the financial year in which the transaction took place. Thus, the assessee's case is squarely covered by the decision of Bheemarasetty Sunitha supra. Hence, we ..... X X X X Extracts X X X X X X X X Extracts X X X X
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