TaxTMI 
TaxTMI 
2011 (8) TMI 632
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....e of non-filing of Form No. 15J under Rule 29D of I. T. Rules, 1962. For this, revenue has raised following ground no.1:"1) That on the facts and circumstances of the case, the Ld. CIT(A) erred in law in deleting addition of Rs.28,01,585/- u/s. 40(a)(ia) of the I. T. Act, 1961 in spite of non filing of Form No. 15J as required under third proviso to clause (i) of sub-section (3) of section 194C of the I. T. Act, 1961, read with Rule 29D of I T Rules, 1962." 3. Brief facts leading to the above issue are that assessee in the business of transportation of goods through hired vehicles, whom payment was made aggregating to Rs.28,01,588/- in respect of 42 vehicles and actual payment is exceeding Rs.50,000/- per vehicle. The assessee before Asses....
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....he time of making payments to the sub-contractor by the appellant, he got ample opportunity of examination of the same during remand proceedings. The A.O. has not pointed out any defect in any Form No. 15-I, copy of which was sent to him for examination during remand proceedings. Under the circumstances, I find that the addition made by the A.O. of Rs.28,01,585/- is unjustified and misconceived and therefore, deleted." Aggrieved, now revenue is in appeal before us. 4. At the outset, Ld. Counsel stated that this issue is squarely covered in favour of assessee by the decision of ITAT, Mumbai "F" Bench in the case of Shri Vipin P. Mehta Vs. ITO, ITA No.3317/Mum/2010 for Assessment Year 2006-07 dated 20th May, 2011, He also relied on the simi....
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....py of the declaration submitted by the payee of the interest to the assessee on or before the seventh day of the month next following the month in which the declaration was furnished to him. If the person responsible for paying the interest (i.e. the assessee) does not comply with sub-section 2 of section 197A, he is liable to pay penalty of Rs. 100/- for every day during which the failure continues. Such penalty can be imposed only by the Commissioner or Chief Commissioner of Income Tax as stated in clause (b) of sub-section 3 of Section 272A and sub-section 4 requires that an opportunity shall be given to the assessee before any penalty order is passed. 7. In the present case the claim of the asse see is that at the time of paying the in....
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....terest to the effect that they did not file any declarations with the assessee at the appropriate time or to the effect that they filed the declarations only at the request of the assessee in September/October, 2008. In the absence of any such direct evidence, we are unable to reject the assessee 's claim. The Assessing Officer has stated in para 4.4 of the assessment order that he found that some of the loan creditors were having taxable income but still the assessee had submitted declarations from them in form no. 15G. Unless it is proved that these forms were not in fact submitted by the loan creditors, the assessee cannot be blamed because at the time of paying the interest to the loan creditors, he has to perforce rely upon the declara....
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.... of the declarations with the office of the CIT/CCIT (TDS) within the time limit specified in sub­section (2) of section 197A, that is a distinct omission or default for which a penalty is prescribed. Section 273B provides that no penalty shall be imposed under any of the clauses of sub-section (2) of section 272A for the delay, if the assessee proves that there was reasonable cause for the same. We have already seen that under sub-section (4) of section 272A, no penalty can be imposed unless the assessee is given an opportunity of being heard. All these provisions indicate that the failure on the part of the assessee, who is the payer of the interest, to file the declarations given to him by the payees of the interest, within the time ....
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....cer by invoking provisions of section 40A(3) of the Act. For this, the revenue has raised following ground no.2: "2. That on the facts and circumstances of the case the Ld. CIT(A) erred in law deleting addition of Rs.16,82,066/- made by A.o. u/s. 40A(3) in violation of extant provisions of law." 7. We have heard rival contentions and gone through facts and circumstances of the case. We find that Assessing Officer made disallowance u/s. 40A(3) of the Act for payments made to drivers/sub-contractors, who are agents of assessee. The Assessing Officer disallowed a sum of Rs.16,82,066/- as according to him cash payment in a day exceeding Rs.20,000/- is the subject matter of disallowance. The CIT(A) deleted the disallowance by holding that for ....