TaxTMI 
TaxTMI 
2018 (2) TMI 179
X X X X Extracts X X X X
X X X X Extracts X X X X
....to what is stated above, the appellant submits that the order under sections 201(1) and 201(1A) passed by the Assessing Officer beyond a period of four years from the end of financial year was barred by time limitation. The appellant submits that even if no period of limitation is prescribed, the statutory powers must be exercised within a reasonable time. 3. (a) The appellant submits that the learned Commissioner of Income tax (Appeals) erred in upholding the action of the learned Tax Recovery Officer (hereinafter referred to as "the Assessing Officer") that payment for pay channel cost amounting to Rs. 93,22,911/- made to distributor of signal is a contract for work and liable for deduction under section 194C of the Act and accordingly erred in holding that the assessee is an assessee in default under section 201(l) of the Act. (b) The appellant submits that as regards payments for cost of pay channels, the payees merely distribute signals to the appellant and accordingly, there is no question of any involvement of "work". (c) The appellant submits that the payment made for procurement of signals are not to any broadcasters or telecasters and accordingly, the provisions ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... agreement entered into by the assessee with the distributors was a distribution agreement and not a broadcasting agreement, therefore, the provisions of Sec.194C r.w. Circular No. 681 and 714 of the CBDT were not applicable to the payments made by the assessee to the aforementioned parties; (ii) that as the provisions contained in Chapter XVIIB did not apply to payment of feed charges, therefore, the assessee company could not be held to be an assessee in default under the provisions of Sec. 201(1) and 201(1A) of the Act; (iii) that as the payments made by the assessee had been subjected to taxes in the hands of the deductees/payees, therefore, as per Circular No. 8/2009 [F. No. 385/08/2009, dated 24.11.2009] and the judgment of the Hon'ble Supreme Court in the case of M/s Hindustan Coca Cola Beverages Pvt. Ltd. Vs. CIT (2007) 293 ITR 226 (SC) the recovery of the tax from the assessee was not permissible; and (iv) alternatively, it was submitted that as the assessee had sought a clarification with regard to applicability of TDS provisions from the CBDT, therefore, the proceedings may be kept in abeyance till the necessary clarification was received. 3. The A.O after deliberating ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....te Tribunal Rules, 1993. We have deliberated on the additional grounds of appeal raised by the assessee and are of the considered view that as the same involve purely a question of law based on the facts available on record, therefore, keeping in view the judgment of the Hon'ble Supreme Court in the case of National Thermal Power Ltd, Vs. CIT (1998) 229 ITR 383 (SC) admit the same. In this regard we may herein observe that no objection was raised by the ld. Departmental Representative (for short 'D.R') at the time of admission of the aforesaid additional grounds of appeal. 6. Before proceeding further, we may herein observe that the present appeal filed by the assessee before us involves a delay of 658 days. The assessee explaining the reason for the aforesaid delay in filing of the appeal had filed an 'Affidavit', dated 15.06.2016 of Shri Vineet Garg, director of the assessee company. That Shri Vineet Garg in his affidavit had deposed that though the order of the CIT(A)-14, Mumbai was handed over to Mr. Pravin Kadam, Deputy Manager of taxation of the holding company, viz. Hathway Cable and Datacom Ltd on 28.06.2014, at 805/806, Windsor Off. CST Road, Kalina, Santa Cruz (E) Mumbai....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e judgment of the Hon'ble Supreme Court in the case of Ramnath Sao Vs. Gobardhan Sao, (AIR 2002 Supreme Court 1021). The ld. A.R taking us through the aforesaid judgment of the Hon'ble Supreme Court submitted that the Hon'ble Apex Court while condoning a delay of 130 days involved in the said appeal, had taken support of its earlier judgment in the case of N. Balkrishnan Vs. M. Krishnamurthi (1998) 7 Supreme Court case, wherein a delay of 883 days was condoned by the Hon'ble Apex Court. The ld. A.R took us through the observations recorded by the Hon'ble Supreme Court, and taking support from the same submitted that merely for the reason that some lapse was there on the part of the litigant in filing appeal within the stipulated time period would not justify the turning down of his plea and declining the admission of his appeal on the said count. It was submitted by the ld. A.R that the Hon'ble Apex Court had observed that where the explanation of the appellant does not smack of malafides or is not put forth as part of a dilatory strategy, the Courts must show utmost consideration to the suitor. It was thus submitted by the ld. A.R that keeping in view the aforesaid observations of....
X X X X Extracts X X X X
X X X X Extracts X X X X
....part of the Shri Pravin Kadam, Deputy Manager (Taxation) of the holding company of the assessee, viz. Hathway Cable Datacom Limited, who on account of bonafide mistake on his part had failed to deliver the order of the CIT(A) for the year under consideration, viz. A.Y 2003-04 to the Chartered accountant for taking the necessary action. We find that the facts as had been deposed by the Managing Director of the assessee, viz. Shri Vineet Garg are found duly supported by the affidavit of Shri Pravin Kadam (supra), who had categorically admitted the fact that he had inadvertently failed to deliver the order of the CIT(A) to the Chartered accountant. We are of the considered view that keeping in view the aforesaid facts, coupled with the fact that on the same issue which was involved in the case of the assessee for the immediately two preceding years, viz. A.Y 2001-02 and A.Y: 2002-03, the appeals of the assessee were pending disposal before the Tribunal, therefore, it can safely be concluded that the assessee would not have benefited from delaying the filing of the present appeal before us. We are of considered view that keeping in view the judgment of the Hon'ble Supreme Court in the ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....the end of the financial year in which the proceedings under Sec. 201(1) were initiated, therefore, the same was barred by limitation. The ld. A.R submitted that though no period of limitation was prescribed, but however, the statutory powers contemplated therein were to be exercised within a reasonable time. It was submitted by the ld. A.R that as the order under Sec. 201(1)/201(1A) passed by the A.O was beyond a period of one year from the end of the financial year in which the proceedings under Sec. 201(1) were initiated, therefore, the same was barred by limitation. The ld. A.R in support of his contention relied on the judgment of the Hon'ble High Court of Bombay in the case of DIT Vs. Mahindra & Mahindra Ltd. (2014) 365 ITR 560 (Bom). It was submitted by the ld. A.R that the issue under consideration was squarely covered by the order passed by the coordinate bench of this Tribunal, viz. ITAT, Mumbai "H", Mumbai in the case of the assessee for A.Ys: 2001-02 and 2002-03, marked as ITA No. 6996/Mum/2014, and ITA No. 4261/Mum/2014, respectively (copy placed on record). The ld. A.R took us through Page 7-Para 2.3 of the aforesaid order of the Tribunal, wherein the Tribunal taking ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ers passed by the lower authorities. 10. We have heard the authorized representatives for both the parties, perused the orders of the lower authorities and the material available on record. We are of the considered view that the issue involved in this case is squarely covered by the judgment of the Hon'ble High Court of Bombay in the case of Director of Income tax (International taxation) Vs. Mahindra & Mahindra Ltd. (2014) 365 ITR 560 (Bom). We find that the Hon'ble High Court had held that even though Sec. 201 does not prescribe any limitation period for an assessee to be declared as an assessee in default, yet the revenue is required to exercise the powers in that regard within a reasonable time. The Hon'ble High Court in the backdrop of its aforesaid observations had upheld the order of the Tribunal by observing as under : "30 Our attention has also been invited to two judgments of the Honourable Delhi High Court which are on the same principle and as to whether in the absence of any time limit the proceedings under Sections 201 and 201(1A) of the Income Tax Act, 1961 could be initiated at any Income Tax v/s NHK Japan Broadcasting Corporation reported in (2008) 305 ITR 137 (....
X X X X Extracts X X X X
X X X X Extracts X X X X
....that would depend upon the facts of each case. Considering the facts of the case, the Supreme Court gave a direction to the assessing authority to complete all the pending assessments within a period of four months from the date of delivery of the judgment. Insofar as Bhatinda District Coop. Milk Producers Union Ltd. [2007] 9 RC 637 : 11 SCC 363 is concerned, the question that arose before the Supreme Court was regarding initiation of proceedings by exercise of jurisdiction by the statutory authority. The Supreme Court held that exercise of jurisdiction must be within a reasonable period of time and considering the provisions of the Punjab General Sales Tax Act, 1948, it was held that a reasonable period of time for initiating proceedings would be five years. There is a qualitative difference between Bharat Steel Tubes Ltd. [1988] 70 STC 122 (SC) and Bhatinda District Coop. Milk Producers Union Ltd. (2007) 9 RC 637 : 11 SCC 363. In the former case, the question pertained to completion of proceedings, while in the latter case is pertained to initiation of proceedings. We are concerned with initiation of proceedings. Insofar as the IncomeTax Act is concerned, our attention h....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... acknowledged that Article 137 of the Limitation Act, 1963 has not been specifically made applicable to the proceedings under the Industrial Disputes Act, 1947 seeking reference of Industrial Disputes to the Labour Court. Therefore, neither this provision nor any principle incorporated therein is applicable to the proceedings under the Industrial Disputes Act, 1947 and that is how the Honourable Supreme Court proceeded to analyze the ambit and scope of the proceedings under the special provision, namely, a Reference by the concerned workman under the Industrial Disputes Act, 1947. The judgment of the Honourable Supreme Court deals with a case where any provision in the nature of limitation or outer limit is prescribed for reference under the Industrial Disputes Act, 1947. The Honourable Supreme Court was not dealing with a case of exercise of powers enabling reopening of Assessment under the Income Tax Act, 1961 or any Taxing Statute. In fact, it was not deciding a case concerned with invoking of any suomotu powers or reopening of assessment finalized under the Tax Law. Therefore, this judgment is clearly distinguishable on facts. 33 If one carefully peruses Section 201(1) and 2....
X X X X Extracts X X X X
X X X X Extracts X X X X
....was deducted to the date on which such tax is actually paid, and such interest shall be paid before furnishing the statement in accordance with the provisions of sub section (3) of section 200:] [Provided that in case any person, including the principal officer of a company fails to deduct the whole or any part of the tax in accordance with the provisions of this Chapter on the sum paid to a resident or on the sum credited to the account of a resident but is not deemed to be an assessee in default under the first proviso to subsection (1), the interest under clause (i) shall be payable from the date on which such tax was deductible to the date of furnishing of return of income by such resident.] (2) Where the tax has not been paid as aforesaid after it is deducted, the amount of the tax together with the amount of simple interest thereon referred to in sub section (1A) shall be a charge upon all the assets of the person, or the company, as the case may be, referred to in subsection (1). [(3) No order shall be made under subsection (1) deeming a person to be an assessee in default for failure to deduct the whole or any part of the tax from a person resident in India, at ....