TaxTMI 
TaxTMI 
TaxTMI 
2014 (7) TMI 45
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....s Act with the object of providing house sites to its members and has, in furtherance of that object, formed several layouts and proposed to distribute the sites to its members. To fulfill the projects undertaken by it, the petitioner has taken the land through intermediaries and developed the same following the Rules. The petitioner in this regard, has entered into an agreement with certain individuals and parties for development of the land so acquired and has undertaken the process of developing the land into house of sites. 4. There was a survey of the petition premises by the Income Tax department in exercise of power under Section 133(a) on 5.12.2013. The respondent during the survey examined books of accounts and other documents maintained by the petitioner and has also recorded his observation. Later, by letter dated 24.2.2014 respondent asked the petitioner why petitioner should not be considered as an assessee in default by the notice Annexure-D. The petitioner claims to have filed detailed submission on 10.3.2014 explaining in detail that the petitioner is not liable for deduction of TDS under Section 194(c)of the Act for the payment made to the developers and thus cann....
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.... appeal, the petitioner has placed reliance on the decision of the apex court in the case of Vodafone India Ltd. Vs. Union of India reported in [2013] 40 Taxmann.com 545 (Bombay), where the Apex Court has allowed the writ action despite availability of alternative remedy of appeal accepting the ground that there was breach of principles of natural justice in exercise of power purported to be under the I.T.Act by the authority considered. 10. Reliance is also placed on decision in the case of Calcutta Discount Co. Ltd. v. Income-tax Officer reported in [1961] 41 ITR 191 (SC) Calcutta to contend that alternate remedy of appeal under the provisions of the Income Tax Act is not always a bar for entertaining writ action when manifest legality is noticed in exercise of power by assessing officer and denial of opportunity to contest which is prerequisite meet the ends of justice. 11. Besides the above grounds, the petitioner has described the steps taken by the authority as harsh and unjustified in freezing the bank account of the petitioner paralyzing its day today functions resulting in incompensatable hardship to the workers of the company who could not be paid salary. 12. On behalf....
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.... question which arises for consideration and decision is, "whether high court was justified in interfering with the order passed by the assessing authority under Section 148 of the Act in exercise of its jurisdiction under Article 226 of the Constitution of India when equal efficacious alternative remedy was available to the assessee under the Act?" 15. In para 16, Apex Court observes that, "16. xxxx Though Article 226 confers a very wide powers in the matter of issuing writs on the High Court, the remedy of writ is absolutely discretionary in character. If the High Court is satisfied that the aggrieved party can have an adequate or suitable relief elsewhere, it can refuse to exercise its jurisdiction. The court in extraordinary circumstance may exercise the power if it comes to the conclusion that there has been a breach of principles of natural justice or procedure required for decision has not been adopted." 16. The learned counsel would again refer to the decision of the Apex Court in the case of M/s. Hindustan Coco Cola Bevarage Pvt. Ltd. Vs. Commissioner of Income Tax, where the Apex Court dealing with action under Sections 201 and 201(1A) of the Act obs....
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....tioner has filed his returns for the relevant period under the provisions of Section 139 of the Act, liability of the petitioner seizes under Section 201 of the Act. The returns filed by the recipient became the basis and if the assessee had declared no tax liability, there is no question of invoking the penal provision under Section 201(1)(a) of the Act. 21. To support this plea, learned counsel refers to the reply submitted by the petitioner at the earliest point of time to the respondent-Officer vide Annexure 'E', informing the Officer that the recipient of the amount has already submitted his returns and the income so received for the relevant period and that should be taken into consideration to hold that no TDS was liable to be deducted by the petitioner. This is the major ground on which jurisdiction of the respondent is questioned. In other words, learned counsel submits, the Officers invoked jurisdiction to pass order under Section 201(c) of the Act without determining whether the petitioner is liable to pay TDS under Section 201 of the Act. He has no jurisdiction to pass any consequential order like the order of assessment or attachment. 22. In negation of these grounds....
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....ntract between the parties inter alia to attract the provisions of Section 194(c) of the Act. Besides, the petitioner has also disclosed in the letter that the recipient of the amount has filed returns and therefore based on the returns, the tax liability of the recipient has to be determined. 26. The impugned order at Annexures A-1 to A-7 shows, for different financial assessment years, action has been initiated only under Section 201 of the Act and as could be seen from the preamble of the order itself, the assessing officer has referred to calling for information under Section 133(6) of the Act for verification of the payments made to the developer/contractor. Therefore, it is not in dispute that the petitioner claims payment is made to the developers engaged in the project with the petitioner for and on behalf of its members. There is an observation that the petitioner has not furnished the reply as on 21.2.2014 necessitating issuance of show cause notice on 24.2.2014. The filing of detailed submission by the assessee on 7.3.2014 is clearly documented in the assessment order. Necessarily, the officer had to take into account the grounds so urged while proceeding to declare, th....
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.... is hard to accept that benefit of the provision will not be available to the petitioner. 31. In this view, it is to be held there has to be a realistic assessment of the fact situation and in that any material information regarding filing of returns/ payment of tax by recipient furnished by the petitioner should receive consideration. 32. The grievance of the petitioner is on receipt of show cause notice, the petitioner has not only sent reply but has sought to support its contention. Despite such request from the petitioner, the assessing officer has failed to consider its request pragmatically and appears to have pre-judged the issue. The manner in which he has conducted the proceedings would show the officer gave no credence to the show cause statement nor examined the documents filed by the petitioner. Even if the assessing officer was of the opinion, the petitioner is liable to deduct TDS on the amount paid to the contractors. The officer should have examined the truth or otherwise of the statement made by the petitioner that the recipient of the amount had filed its returns for tax assessment. Had the petitioner been given an opportunity of personal hearing as sought for, ....