Income Tax Appellate Tribunal - Hyderabad
M/S Ncc Maytas Jv,, Secunderabad vs Assessee
IN THE INCOME TAX APPELLATE TRIBUNAL
HYDERABAD " B " BENCH, HYDERABAD
BEFORE SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER AND
SHRI SAKTIJIT DEY, JUDICIAL MEMBER
ITA No.812/Hyd/2013
Assessment Year 2006-07.
M/s. NCC Maytas JV,Begumpet, -v- Asstt. CIT, Circle-6(1),
Hyderabad. Hyderabad.
PAN:AADFN 4027D
(Appellant) (Respondent)
Appellant by Shri KC Devdas
Respondent by Shri K.E. Sunil Babu
Date of Hearing 26-8-2013
Date of pronouncement 13-09-2013
ORDER
PER SAKTIJIT DEY, J.M:
This appeal of the assessee is directed against the order dated 13-3-2013 of CIT (A)-9, Mumbai camp at Hyderabad pertaining to assessment year 2006-07.
2. The only issue in the present appeal is with regard to the disallowance of TDS claim to the tune of Rs.2,86,134/- on the ground that the TDS should be corresponding to gross receipts disclosed by the assessee for the assessment year under dispute.
3. Briefly the facts are, the assessee is a joint venture. For the impugned assessment year the assessee filed its return of income disclosing total income of Rs.1,38,91,595/-. Initially, the 2 ITA No.812 of 2013 M/s NCC Maytas JV Hyderabad.
return was processed u/s 143(1) of the Act on 27-4-2007 accepting the income returned. Subsequently however the assessee's return was selected for scrutiny assessment and in the course of assessment proceedings, the Assessing Officer while examining the details noticed that the assessee had claimed TDS of an amount of Rs.58,22,932/- as per TDS certificate filed for the impugned assessment year. However, he further noticed that the entire gross receipts of Rs.25,23,31,091/- as mentioned in the TDS certificate has not been shown by the assessee in the P & L account. When the Assessing Officer asked to explain the same, the assessee submitted that he had declared turnover of Rs.23,99,32,700/- in the year under dispute as the balance portion of the turnover was offered to tax in the preceding assessment years. The Assessing Officer however rejected such contention of the assessee by observing that as per the provisions contained u/s 199 of the Act TDS has to be restricted to the receipts shown by the assessee. He accordingly disallowed proportionate amount of TDS and allowed an amount of Rs.55,36,798/- as credit given to TDS. The assessee being aggrieved of such disallowance of portion of TDS preferred an appeal before the CIT (A).
4. On appeal, the CIT (A) sustained the disallowance by observing that Rule 37BA of Income-tax Rules, 1962 provided for such apportionment of TDS to different assessment years in which the income is assessable on proportionate basis.
5. The learned authorised representative for the assessee reiterating the stand taken before the CIT (A) submitted before us out of the gross receipts of Rs.25,23,31,091/- mentioned in TDS certificate issued for the impugned assessment year, an amount of Rs.23,99,32,700/- was shown in the assessment year 3 ITA No.812 of 2013 M/s NCC Maytas JV Hyderabad.
under dispute as the rest of the amount has already been offered for taxation in the preceding assessment years by the assessed. However, the assessee had not taken credit of the TDS relating to turnover disclosed in the earlier assessment year. Hence, it was argued that the TDS amount as mentioned in the TDS certificate for the impugned assessment year should be given credit in its entirety without disallowing a portion of it. The learned authorised representative for the assessee further contended that section 199 of the Act is an enabling provision for granting TDS provision and not a computation provision. In support of such contention, the learned authorised representative for the assessee relied upon the following decisions:-
i) Court on its own Motion vs. CIT 352 ITR 273 (Del)
ii) CIT vs. Nagri Mills Co. Ltd. (33 ITR 681 (Bom)
iii) Berger Paints India Ltd. Vs. CIT (266 ITR 99) (SC)
6. The learned Departmental Representative, on the other hand, supported the order of the CIT (A).
7. We have considered rival submissions of the parties and perused the material on record. The sole grievance of the assessee in the present appeal is with regard to the disallowance of a portion of TDS claimed for the impugned assessment year on the ground that turnover corresponding to such TDS was not disclosed by the assessee in the return filed for the impugned assessment year. On perusal of facts and materials available on record as well as the order passed by the revenue authorities, we find that there is no dispute to the fact that out of the total turnover of Rs.25,23,31,091 the assessee had disclosed turnover of Rs.23,99,32,700/- for the impugned assessment year. Further, the revenue authorities have not disputed the claim of the 4 ITA No.812 of 2013 M/s NCC Maytas JV Hyderabad.
assessee that the balance portion of the turnover was offered to tax in the earlier assessment year. We further find from facts on record that there is no material brought on record to show that the assessee had claimed corresponding TDS relating to the balance portion of the turnover in the concerned assessment years. It is an admitted fact that the entire TDS relating to Rs.25,23,31,091/- was claimed for the impugned assessment year as the TDS certificate relates to the assessment year under dispute. The assessee having not claimed any portion of TDS in the preceding assessment years wherein a part of the turnover was offered to tax, the assessee's claim of TDS in the impugned assessment year cannot be rejected on the ground that it relates to the turnover which has not been shown by the assessee for the impugned assessment year. The Hon'ble Delhi High Court in case of Court on its own Motion vs. CIT (supra) while dealing with identical issue has observed in the following manner:-
"There can be mismatch because of the deductor and the assessee may be following different methods of accounting. Further, he assessee may treat the income on which tax has been deducted as income for two or more different years. The respondents must take remedial steps and ensure that in such cases TDS is not rejected on the ground that the amounts do not tally. Of course, while issuing corrective steps, the respondents can ensure that fraudulent or double claims for TDS are not made. We are not issuing any specific directions as it is a technical matter but the respondents should take remedial steps in this regard."
8. The Hon'ble Supreme Court in case of Berger Paints India Ltd. Vs. CIT (supra) referred to a decision of Income-tax Appellate Tribunal, Special Bench in case of Indian 5 ITA No.812 of 2013 M/s NCC Maytas JV Hyderabad.
Communication Network Pvt. Ltd. Vs. IAC (206 ITR (AT) 96 held as under:-
" Before we part with this ground, we cannot help feeling that the litigation between the parties could have been avoided since it was quite immaterial, whether full deduction was allowed in one year or partly in one year and partly in the next, since the assessee is a company and rate of tax is uniform. The gain to open and the loss to the other is illusory since what is deferred in one year, would have to be discharged in the next. In that sense, nobody has won and nobody has lost."
9. The Hon'ble Bombay High Court in case of CIT vs. Nagri Mills Co. Ltd (33 ITR 681 (Bom) held as under :-
" We have often wondered why the income-tax authorities, in a matter such as this where the deduction is obviously a permissible deduction under the Income-tax Act, raise dispute as to the year in which the deduction is allowable may be material when the rate of tax chargeable on the assessee in two different years is different; but in the case of income of a company, tax is attracted at a uniform rate, and whether the deduction in respect of bonus was granted in the assessment year 1952-53 or in the assessment year corresponding to the accounting year 1952, that is in the assessment year 1953-54, should be a matter of no consequence to the department, and one should have thought that the d epartment would not fritter away its energies in fighting matters of this kind. But, obviously, judging from the references that come up to us every now and then, the department appears to delight in raising points of this character which do not affect the taxability of the assessee or the tax that the department is likely to collect from him whether in one year or the other."
Therefore considering the contention of the learned authorised representative for the assessee in the context of the ratio laid down as aforesaid, we are of the view that the revenue authorities were not justified in disallowing a part of TDS on the ground that it does not 6 ITA No.812 of 2013 M/s NCC Maytas JV Hyderabad.
relate to the turnover disclosed for the impugned assessment year. We hold that income relating to such TDS having already been offered to tax in the earlier assessment years and since the assessee has not claimed corresponding TDS in those assessment years, no disallowance of the TDS claimed can be done. So far as the CIT (A) relying on rule 37BA of IT Rules is concerned, we are of the view that in the first place the said rule is not applicable to the assessment year under dispute as it has been inserted into the statute by IT (Sixth Amendment) Rules 2009 with effect from 1-4-2009. Even if we go by the aforesaid rule, the Assessing Officer was required to give credit to the TDS in the corresponding assessment years wherein the income was so offered which also would have resulted in refund to the assessee. In aforesaid view of the matter, we hold that no disallowance of TDS can be made in the given facts and circumstances of the case and the assessee is entitled to claim credit for the entire TDS amount of Rs.55,22,932/- in the impugned assessment year. Accordingly, we set aside the order passed by the CIT (A) by allowing the ground raised by the assessee.
10. In the result, the appeal is allowed.
Order pronounced in the court on 13-9-2013.
Sd/- Sd/-
( CHANDRA POOJARI) (SAKTIJIT DEY)
ACCOUNTANT MEMBER JUDICIAL MEMBER
Hyderabad,
Dated the 13 th Sept. 2013
Jmr*
7
ITA No.812 of 2013
M/s NCC Maytas JV Hyderabad.
Copy to:-
1) M/s. NCC Maytas JV, 6-3-1186/5/A, 3 rd Floor, Amogh Plaza, Begumpet, Hyderabad.
2) ACIT, Cir-6(1), Hyderabad.
3) CIT (A)-9, Mumbai, camp at Hyderabad.
4) CCIT-III, Hyderabad.
5.The Departmental Representative, I.T.A.T., Hyderabad.
Jmr* * 8 ITA No.812 of 2013 M/s NCC Maytas JV Hyderabad.