Income Tax Appellate Tribunal - Delhi
M/S Medsave Healthcare (Tpa) Ltd,, New ... vs Dcit, Ghaziabad on 19 February, 2018
IN THE INCOME TAX APPELLATE TRIBUNAL
(DELHI BENCH 'A' : NEW DELHI)
BEFORE SHRI B.P. JAIN, ACCOUNTANT MEMBER
and
SHRI KULDIP SINGH, JUDICIAL MEMBER
ITA No.1916/Del./2016
(ASSESSMENT YEAR : 2012-13)
M/s. Medsave Healthcare (TPA) Ltd., vs. DCIT,
F - 701, Lado Sarai, CPC TDs, Vaisahli,
New Delhi - 110 030. Ghaziabad.
(PAN : AABCS8148M)
(APPELLANT) (RESPONDENT)
ASSESSEE BY : Shri Sanjay Joshi, CA
REVENUE BY : Smt. Ashima Neb, Senior DR
Date of Hearing : 12.02.2018
Date of Order : 19.02.2018
ORDER
PER KULDIP SINGH, JUDICIAL MEMBER :
The appellant, M/s. Medsave Healthcare (TPA) Ltd. (hereinafter referred to as 'the assessee company') by filing the present appeal, sought to set aside the impugned order dated 18.02.2016 passed by Ld. CIT(Appeals)-41, New Delhi qua the assessment year 2012-13 on the grounds inter alia that :- 2 ITA No.1916/Del./2016
"1. The Ld. CIT (A) has erred in confirming the action of the AO in levying interest on late payments of TDS and has failed to apply her mind to the facts and circumstances of the case by ignoring the stay order of the Hon'ble Delhi High Court wherein no recoveries were to be made pursuant to the circular no.8/2009 dt. 24.11.2009 and hence the impugned order being bad in law is to be set aside.
2. The Ld. CIT (A) has erred in confirming the action of the AO by ignoring judicial precedents and the decision by Ld. CIT (A) in the appellants case for AY 2011-12 (FY 2010-11) without cogent reasons and hence the order being bad in law needs to be set aside.
3. The Ld. CIT (A) has confirmed the action of the AO in a mechanical, arbitrary and ad-hoc manner without considering the hardship and financial instability that the assessee will go through which is against natural justice and hence the order needs to be struck down."
2. Briefly stated the facts necessary for adjudication of the controversy at hand are : The assessee company is a Third Party Administrator for insurance companies and made payment to various hospitals under cashless scheme on behalf of such insurance companies. On the basis of computer generated order/intimation under section 154 of the Income-tax Act, 1961 (for short 'the Act'), interest has been charged u/s 201(1A) of the Act for late payment of TDS by the assessee company.
3. Assessee carried the matter by way of filing appeal before the ld. CIT (A) who has partly allowed the appeal. Feeling 3 ITA No.1916/Del./2016 aggrieved, the assessee has come up before the Tribunal by way of filing the present appeal.
4. We have heard the ld. Authorized Representatives of the parties to the appeal, gone through the documents relied upon and orders passed by the revenue authorities below in the light of the facts and circumstances of the case.
5. Bare perusal of para 4.7 of the impugned order passed by the ld. CIT (A) goes to prove that the ld. CIT (A) by taking notice of the fact that the assessee company is entitled to be heard to explain the computation of interest u/s 201(1A) and consequently directed the AO to proceed in the matter. For facility of reference, para 4.7 of the impugned order passed by the ld. CIT (A) is reproduced as under :-
"4.7 It is seen that the intimation u/s 154 has been passed by CPC-TDS. The appellant has contended that the limitation has been processed in a mechanical manner without considering hardship and financial instability that the assessee will go through. In my view, charging of interest u/s 201(1A) cannot be questioned on the basis of financial condition of the assessee and recovery of demand is consequential in nature. However, considering the special circumstances in view of the High Court order, appellant should get an opportunity to explain the computation of interest u/s 201(1A) before the AO. The AO is directed to give the appellant an opportunity to submit detailed calculation of taxes deducted and deposited and to charge interest as per law, after due verification of the same."
6. When undisputedly order / intimation has been passed u/s 154 by CPC - TDS in a mechanical manner without providing an 4 ITA No.1916/Del./2016 opportunity of being head to the assessee and thereby enhanced the tax liability of the assessee company, provisions contained u/s 154 (3) of the Act are attracted making it obligatory on the part of the Revenue to provide an opportunity of being heard to the assessee company. So, in these circumstances, impugned order passed by the ld. CIT (A)is not sustainable in the eyes of law and consequently file is ordered to be remanded to AO to decide afresh after providing an opportunity of being heard to the assessee company.
7. Resultantly, the appeal filed by the assessee stands allowed for statistical purposes.
Order pronounced in open court on this 19th day of February, 2018.
Sd/- sd/-
(B.P. JAIN) (KULDIP SINGH)
ACCOUNTANT MEMBER JUDICIAL MEMBER
Dated the 19th day of February, 2018
TS
Copy forwarded to:
1.Appellant
2.Respondent
3.CIT
4.CIT(A)-41, New Delhi.
5.CIT(ITAT), New Delhi. AR, ITAT
NEW DELHI.