Income Tax Appellate Tribunal - Chandigarh
The Punjab State Coop Bank Ltd., ... vs Ito Tds-Ii, Chandigarh on 7 February, 2018
I N T H E I NC O M E T AX A PP E L L A T E T RI B UN A L
D I VI S I O N B E NC H , 'B' C H A N DI G A RH
BEFORE SHRI SANJAY GARG, JUDICIAL MEMBER
AND Ms. ANNAPURNA GUPTA, ACCOUNTANT MEMBER
ITA No. 950/CHD/2016
Assessment Year : 2013-14
The Punjab State Coop Bank Ltd., Vs. The ITO, (TDS-1),
SCO 2453-2454, Sector 22-C, Chandigarh
Chandigarh
TAN No. PTLT10940G
(Appellant) (Respondent)
Appellant by : Sh. M.R. Sharma, Advocate
Respondent by : Sh. Manjit Singh, Sr.DR
Date of Hearing : 07.02.2018
Date of Pronouncement: 07.02.2018
ORDER
Per Sanjay Garg, Judicial Member:
The present appeal has been preferred by the assessee against the order dated 26.02.2016 of the Commissioner of Income Tax(Appeals)-1, Chandigarh [hereinafter referred to as CIT(A)].
2. The assessee has taken following grounds of appeal:
1. That the order of the Income Tax Officer (TDS-
II), Chandigarh as upheld by the Commissioner of Income Tax (Appeals)-1, Chandigarh is bad in law and is beyond all the cannons of law and justice.
2. That the order of the Income Tax Officer (TDS-I), Chandigarh as upheld by the Commissioner of Income Tax (Appeals)-1, Chandigarh upholding the levy of interest u/s 201(1A) at Rs. 13510/- in respect of trusts ITA No.950/Chd/2016- The Punjab State Coop Bank Ltd., Chandigarh 2 which are regular assessee and have tiled return declaring Nil income being exempt under the provision of section 10 of the Income Tax Act is bad in law and needs to be deleted in view of the Judicial Decisions in this behalf.
3. That the order of the Income Tax Officer (TDS-I), Chandigarh as upheld by the Commissioner of Income Tax (Appeals)-1, Chandigarh upholding the levy of interest u/s 201(1) at Rs.193000/- in respect of trusts which are regular assessee and have filed return declaring Nil income being exempt under the provision of section 10 of the Income Tax Act is bad in law and needs to be deleted in view of the Judicial Decisions in this behalf.
4. That the appellant craves leave to add, delete, alter any of the grounds of appeal before the same is heard finally.
It is therefore humbly prayed that the levy of tax and interest amounting to Rs. 193000/- and Rs 13510/- may kindly be deleted.
3. T h e a p p e a l i s b a r r e d b y l i mi t a t i o n o f 1 0 3 d a ys . T h e a s s e s s e e h a s mo v e d a n a p p l i c a t i o n f o r c o n d on a t i o n o f d e l a y, w h e r e i n , i t has been stated that though order was received by the assessee on 1 6 . 3 . 2 0 1 6 a n d t he l i mi t a t i o n f o r f i l i n g t h e a p p e a l w a s u p t o 1 5 . 5 . 2 0 1 6 , h o w e v e r , t h e B r a n c h Ma n a g e r of t h e a s se s s e e s o u g h t t h e l e g a l a d v i c e f r o m t h e c o n c e r n e d c o u n s e l , S h r i M . R . S h a r ma v i d e h i s l e t t e r d a t e d 5 . 6 . 2 0 1 6 ( a f t e r e x p i r y o f t h e l i mi t a t i o n p e r i o d ) . T h e r e a f te r , t h e f i l e mo v e d f r o m o n e s e a t t o a n o t h e r a n d , i n f a c t , t o a n d f ro m o f f i c e of A GM t o G e n e r a l M an a g e r , f r o m G e n e r a l M a n a g e r t o M a n a g i n g D i r e c t o r a n d t h i s w a s r e p e a t e d t i me a n d a g a i n a n d f in a l l y t h e a s s e s s e e d e c i d e d t o f i l e t h e p r e s e n t appeal on 19.8.2016 and wrote a letter to the concerned counsel / ITA No.950/Chd/2016- The Punjab State Coop Bank Ltd., Chandigarh 3 a d v o c a t e t o p r e p a r e t h e a p p e a l o n 2 2 . 8 . 2 0 1 6 . T h e r e a f t er , t he c o n c e r n e d c o u n s e l n a me l y S h r i M . R . S h a r ma p r e p a r e d t h e a p p e a l a n d f i l e d t h e s a me o n 2 6 . 8 . 2 0 1 6 . T h e c o n t e n t s o f t h e a p p l i c a t i o n mo v e d f o r c o n d o n a t i o n o f d e l a y f o r t h e s a k e o f r ef e r e n c e a re r e p r o d u c e d a s u n de r : -
" S u b je ct : - A pp l i ca t i on fo r co n d on a t io n of d e l ay i n f il i n g th e a p pe a l
1. That the appellant is a Cooperative society dully r e g i s t e r e d u n d e r th e p r o v i s i o n s o f Pu n j a b C o o p e r a t i v e Act l961. The appellant society is a Bank and is one of the branch of the said bank. The appellant bank is s e p a r a t e l y r e g i s t er e d f o r t h e p u r p o se s o f T D S a n d h a s been separately allotted TAN and is regularly filing its returns under the provisions of-income tax Act. The appellant filed its returns of TDS in form 26Q for the year under consideration. The returns so filed has b e e n a c c e p t e d b y t h e d e p a r t m e n t i n e a r l i e r y e a rs e x c e p t t h e f i n a n c ia l y e a r r e l e v a n t to t h e a s s e s s m e n t year 2012-2013. The case of the assessee for the assessment year 2012- 2013 and 2013-2014 was taken up for scrutiny assessment. The Assessing Officer respondent while completing the assessment in this c a s e h e l d t h e a pp e l l a n t a s a s s e s se e i n d e f a u l t i n respect of interest paid on deposits of the cooperative s o c i e t i e s a n d a l so o n e o f t h e t r us t . T h e A s s e s s i n g Officer respondent also levied tax and interest on such TDS on the payments of interest as per the provisions c o n t a i n e d u / s 1 9 4 A o f t h e I n c o m e T ax A c t .
2. That the order appealed against in this case was r e c e i v e d b y t h e ap p e l l a n t o n 1 6 - 0 3 - 2 0 1 6 . T h e a p p e a l in this case could be filed on or before 15-05-2016. T h e b r a n c h M a n ag e r o f t h e a p p e l la n t s o u g h t l e g a l a d v i c e f r o m S h r i M . R . A d v o c a t e v i de h i s l e t t e r d at e d 5 - 0 6 - 2 0 1 6 a d v i s e d t h e a p p e l l a n t to f i l e a n a p p e a l against the order of the Commissioner of Income tax (A p p e a l s ) C h a n d i g a r h .
3. That the appellant bank wrote a letter dated 12-04- ITA No.950/Chd/2016- The Punjab State Coop Bank Ltd., Chandigarh 4
2 0 1 6 t o t h e C h ie f E x e c u t i v e O f f ic e r o f t h e B a n k seeking the deposit of the TDS demand alongwith a c o p y o f t h e o r d er a p p e a l e d a g a i ns t . T h e t r u s t v i d e l e t t e r d a t e d 2 4 -0 6 - 2 0 1 6 d e n i e d i t s l i a b i l i t y a n d r e f u s e d t o m a k e go o d t h e l o s s o f t he a p p e l l a n t . A g a i n o n 1 7 - 0 6 - 2 0 1 6 a n o t h e r l e t t e r w a s w r i t t e n t o t h e s a id trust.
3 . T h a t S e n i o r B ra n c h M a n a g e r o f th e b a n k s u b m i t t e d a note dated 8-06-2016 alongwith the advice of the a d v o c a t e t o t h e M a n a g i n g D i r ec t o r o f t h e B a nk through the AGM of the bank seeking therein approval to file the appeal.
4 T h a t t h e A G M o f t h e b a n k o n 9 - 0 6 -2 0 1 6 s e n t t h e f i l e to the General Manager of the bank for his approval.
5. That the General Manager of the Bank called for the Branch Manager to discuss the case vide his note dated 13-06-2016.
6 . T h a t o n 1 3 - 0 6 - 2 0 1 6 t h e c a s e w a s d is c u s s e d w i t h t h e branch Manager and the General Manager on the same day advised to write to the trust in this behalf. T h e G e n e r a l M a n a g e r (O P ) o f t h e a g r e e d w i t h t h e advice of the AGM and sent back the file to the branch Manager.
7. That the branch Manager wrote a letter to the trust on 17-06-2016 after the reply dated 24-06-2016 the matter was again put up on 28-06-2016 to the AGM by the branch Manager.
8. That the AGM vide his note dated 30-6-2016 placed the matter before the General Manager. The General Manager of the bank sent the file to the A d d i t i o n a l M a n a g i n g D i r e c t o r o f th e B a n k v i d e h i s n o t e d a t e d 3 0 - 6- 2 0 1 6 . T h e A d d it i o n a l M a n a g i n g Director of the bank on 1-07-2016 sought information from the General Manager. On 19-07-2016 the case was discussed and the Additional Managing Director of the bank forwarded the file to the Managing D i r e c t o r . M a n a g i ng D i r e c t o r o f t h e ba n k v i d e h i s n o t e 2 1 - 0 7 - 2 0 1 6 d e s i r ed t h e a d d i t i o n a l M a n a g i n g D i r e c t or to the discuss. The additional Managing Director send ITA No.950/Chd/2016- The Punjab State Coop Bank Ltd., Chandigarh 5 t h e f i l e t o t h e G e ne r a l M a n a g e r o n 21 - 0 7 - 2 0 1 6 . O n 2 - 08-2016 the matter was discussed by the AGM and p l a c e d t h r o u g h th e G e n e r a l M a na g e r b e f o r e t h e Additional Managing Director on 2-08-2016. A p p r o v a l t o f i l e t h e a p p e a l w a s a c c o r d e d b y t he Managing Director on 8/08/2016. The file was sent by t h e G e n e r a l M a n ag e r o n 1 8 - 0 8 - 2 0 1 6 t o t h e A G M a n d then the AGM sent the file to the Branch Manager vide note dated 19-08-2016. The branch Manager r e q u e s t e d t h e A d vo c a t e o n 2 2 - 8 - 2 0 16 (2 0 - 8 - 2 0 1 6 a n d 21-08-2016 being holidays) to prepare the appeal. On 26-08-2016 the Advocate Shri M.R. Sharma prepared t h e a p p e a l a n d t h e s a m e i s f i l e d o n 26 - 0 8 - 2 0 1 6 .
9. That the issue involved in this case is covered in favour of the appellant in the case of the another branch of the appellant bank in appeal No 97/2016 v i d e o r d e r d a t e d 1- 0 7 - 2 0 1 6 I t i s t h e r e f o r e h um b l y p r a y e d i n t he s e f a c t s a n d c i r c u m s t a n c e s t h e d e l a y o f 1 0 3 da y s i n f i l i n g t h e appeal may kindly be condoned."
4. A perusal of the above contents of the application, itself, r e v e a l s t h a t t h e c on c e r n e d o f f i c e r s of t h e A s s e s s e e S o ci e t y d i d n o t b o t h e r t o e v e n c o n s i d e r t h e f i l i n g of t h e a p p e a l t i l l t he e x p i r y o f t h e l i mi t a t i o n p e r io d . T h e y w o k e u p f o r t h e f i r st t i me on 5 . 6 . 2 0 1 6 o n l y, a n d s o u g h t t h e l e g a l a d v i c e f r o m the concerned counsel, w h e r e a s , t h e li mi t a t i o n p e r i o d h a d al r e a d y e x p i r e d o n 1 5 . 5 . 2 0 1 6 . H o w e v e r , t h e r e a f te r t h e f i l e mo v e d f r o m o n e t a b l e t o a n o t h e r a n d t h i s p r o c e s s w a s r e p e a t e d t i me a n d a g a i n , s o a s t o m a k e u p t h e mi n d w h e t h e r t h e y s h o u l d f i l e a n a pp e a l o r n o t . I t i s a c l e a r c u t c a s e o f g r o s s n e g li g e n c e a n d i n a c t i on o n t h e p a r t of th e o f f ic i a l s o f t h e a s s e s s e e . Th e a f o r e s a i d p l e a t a k e n b y t h e a s s e s s e e , i n o u r ITA No.950/Chd/2016- The Punjab State Coop Bank Ltd., Chandigarh 6 v i e w , d o e s n o t c o n s t i t u t e a r e a s o n a b l e c a u s e f o r c o nd o n a t i o n o f d e l a y.
5. T h e A p e x C o u r t i n t h e c a s e of P o s t ma s t e r G e n e r a l v s . Living Media India Ltd (2012) 3 SCC 563 has held that red t a p i s m w i t h i n t h e d e p a r t me n t , s l o w mo v e me n t o f f i l e s , i mp e r s o n a l ma c h i n e r y, b u r e a u c r a t i c me t h o d o l o g y i n ma k i n g d e c i s i o n s a r e n o l o n g e r a c c e p t a b l e a s ' S uf f i c i e n t C a us e ' f o r c o n d o n a t i on of d e l a y. T h e r e l e v a n t p a r t o f t h e d e c i s i o n ( su p r a ) of t h e H o n 'b l e S u p r e me C o u r t i s r e p r o d u c ed a s u n d e r :
" It is not in dispute that the person(s) concerned were well aware or conversant with the issues involved including the prescribed period of limitation for taking up the matter by way of filing a special leave petition in this Court. They cannot claim that they have a separate period of limitation when the Department was possessed with competent persons familiar with court proceedings. In the absence of plausible and acceptable explanation, we are posing a question why the delay is to be condoned mechanically merely because the Government or a wing of the Government is a party before us. Though we are conscious of the fact that in a matter of condonation of delay when there was no gross negligence or deliberate inaction or lack of bona fides, a liberal concession has to be adopted to advance substantial justice, we are of the view that in the facts and circumstances, the Department cannot take advantage of various earlier decisions. The claim on account of impersonal machinery and inherited bureaucratic methodology of making several notes cannot be accepted in view of the modern technologies being used and available. The law of limitation undoubtedly binds everybody, including the Government.
In our view, it is the right time to inform all the government bodies, their agencies and instrumentalities that unless they have reasonable and acceptable explanation for the delay and there was bona fide effort, there is no need to accept the usual explanation that the ITA No.950/Chd/2016- The Punjab State Coop Bank Ltd., Chandigarh 7 file was kept pending for several months/years due to considerable degree of procedural red tape in the process. The government departments are under a special obligation to ensure that they perform their duties with diligence and commitment. Condonation of delay is an exception and should not be used as an anticipated benefit for the government departments. The law shelters everyone under the same light and should not be swirled for the benefit of a few."
6. F u r t h e r i n t h e c a s e o f " A ma l e n d u K u ma r B e r a v . S t a t e of We s t B e n g a l ( 2 0 1 3 ) 4 S C C 5 2 , t h e A p e x C o u r t h a s h e l d a s u n d e r :
"True it is, that courts should always take liberal approach in the matter of condonation of delay, particularly when the appellant is the State but in a case where there are serious laches and negligence on the part of the State in challenging the decree passed in the suit and affirmed in appeal, the State cannot be allowed to wait to file objection under Section 47 till the decree holder puts the decree in execution. ... Merely because the respondent is the State, delay in filing the appeal or revision cannot and shall not be mechanically considered and in the absence of "sufficient cause" delay shall not be condoned."
7. We ma y f u r t h e r p o i n t o u t h e r e t h a t e v e n t h e a s s e s s e e d o e s n o t f a l l u n d e r t h e d e f i n i t i o n of S t a t e . The assessee society d e s p i t e c o n s c i o u s o f t h e d e c i si o n of t h e C I T ( A ) , d i d n o t b o t h e r e v e n t o c o n t e mp l a t e t h e f i l i n g of t he a p p e a l t i l l t h e ex p i r y o f t h e l i mi t a t i o n p e r i o d . F u r t h e r , i t i s n o t a s i mp l e c a s e o f s e e k i ng sanction from the higher authorities by the Branch Manager, r a t h e r , t h e f i l e r ep e a t e d l y mo v e d b e t w e e n t h e s a me d e s k s a s t h e c o n c e r n e d o f f ic i a ls h a d n o t ma d e u p t h e i r mi n d t o f i l e t h e a p p e a l . ITA No.950/Chd/2016-
The Punjab State Coop Bank Ltd., Chandigarh 8 T h e l a w l a i d d o w n b y t h e H o n 'b l e S u p r e me Court in the cases c i t e d ( s u p r a ) , i s sq u a r e l y a p p l i c a b l e t o t h e c a s e i n h a nd .
We , t h e r e f o r e , d o n o t f i n d a n y j u s t i f i e d r e a s o n t o c on d o n e t h e d e l a y. T h e a p p l i c a t i o n f o r c o n do n a t i o n o f d e l a y i s , t h e r e f o r e , d i s mi s s e d a n d i n c o n s e q u e n c e t o w h i c h , t h e a p p e a l f i l e d b y t h e a s s e s s e e i s a l s o h er e b y d i s mi s s e d .
T h e o r d e r i s p r o n ou n c e d i n t h e o p e n c o u r t a t t h e c o n c lu s i o n o f h e a r i n g of t h e ca s e a n d i n t h e p r e se n c e o f pa r t i e s o n 7 . 2 . 2 0 1 8 , Sd/- Sd/-
(ANNAPURNA GUPTA) (SANJAY GARG) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated : 16.05.2018 Rkk Copy to: • The Appellant • The Respondent • The CIT • The CIT(A) • The DR