TaxTMI 
TaxTMI 
2018 (4) TMI 1596
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....ity for the financial period 2007-2008 was barred by limitation? 3. Whether the ld. ITAT was correct in confirming demand of interest u/s 201(1A) of the Act where the recipient of such income had discharged the applicable tax? 3. The brief facts of the case are that Sri Karan Narendra Agriculture University, Jobner (hereinafter referred to as the "assessee appellant University") came to be established for promoting agricultural sciences as an Agricultural University situated at Jobner by the Act of the Agriculture University, Jobner, Act, 2013 (Act No. 20 of 2013). On 13.09.2013, the gazettee notification for establishment of the assessee appellant University was issued after obtaining the approval of the Hon'ble Governor, State of Rajasthan. The assessee appellant University is an autonomous body functioning in public interest with no motive of profit or for profit. The assessee appellant University is functioning under overall management, control and supervision of the Government of Rajasthan. Rajasthan Agriculture Research Institute, Durgapura, Jaipur having TDS Number (hereinafter referred to as 'TAN') JPRA00923G was working under the aegis of Swami Kesh....
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....sessee appellant University and passed the assessment order dated 27.03.2015 under TAN: JPRS14180F whereby demand of Rs. 12,00,963/- was raised against the assessee appellant University u/s. 201(1)/201(1A) of the Act amounting to Rs. 6,27,384/- and Rs. 5,73,579/- respectively. 5. Counsel for the appellant Mr. Ranka has taken us to the order of CIT(A) wherein it has been observed as under: 4.3 The appellant has contended that during the year under consideration, this university was looked after by Swami Keshwanand Agriculture University, Bikaner and therefore assessee was not in existence in the year under consideration. This university came into existence on 13.09.2013 and therefore when the assessee was not in existence, no such responsibility of deducting TDS can be cast on it. On perusal of the scheme of the Act, it is clear that liability of deducting TDS is that of respective DDO. In the year under consideration, this agricultural university was one of the DDOs of Bikaner University. It has not a separate TDS No. Therefore the contention of A/R cannot be accepted and AO has rightly made assessment in hands of assessee. This ground is dismissed. ....
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....ed 13/11/2000 was issued to the appellant was not considered. This is apparent from the fact that the appellant had while filing the return of income on 17/11/2000 consequent to the reopening notice on 13/11/2000 had indicated that profit and loss account and balance sheet were part of the original return and therefore were not being separately attached. The return as filed on 17/11/2000 was identical to one filed on 22/09/1997. Inspite of the same on 20/11/2000 the Assessing Officer called for the profit and loss account and balance sheet on the ground that the same is not attached to the return of the income filed on 17/11/2000. It is submitted that if the return of income was available with the Assessing Officer there would have been no occasion for him to call for the balance sheet and profit and loss account by letter dated 20/09/2000 from the appellant. Thus the conclusion of the CIT(A) as well as the Tribunal that the original return of income may have been available on 13/11/2000 when the notice for reopening was issued without any evidence/basis cannot be sustained. 12. As against the above, Mrs. A. Desai submits that it is not open to the appellant to raise an is....
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....urisdiction to issue notice. Thus this lack of satisfaction of jurisdictional fact can never confer jurisdiction and an objection to it can be raised at any time even in appeal proceedings. The mere fact that no objection is taken before the Assessing Officer would not by itself bestow jurisdiction as the Assessing Officer. Such an objection can be taken in appeal also. Moreover, the Apex Court in its recent decision in Kanwar Singh Saini V/s. High Court Of Delhi reported in MANU/SC/1111/2011 : 2012(4) SCC 307 has held that it is settled position that conferment of jurisdiction is a legislative function and cannot be conferred by consent of petitioner. An issue of jurisdiction can be raised at any time even in appeal or execution. Reliance in this regard could usefully be made to Indian Bank v/s Manilal Govindji Khona reported in MANU/SC/0103/2015 : 2015 (3) SCC 712. Paras 22 of the said judgment read as under : "22. In Sushil Kumar Mehta case [Sushil Kumar Mehta v. Gobind Ram Bohra, MANU/SC/0593/1989 : (1990) 1 SCC 193] this Court has elaborately considered the relevant factual and l....
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....ion that income has escaped assessment then the same must be urged by the Revenue before the authorities. Further if such other source is relied upon then the principles of natural justice would require that before the passing of assessment orders, the same must be brought to the notice of the parties so as to enable the noticee to explain that the reliance upon the same is not justified. 17. Therefore in view of the above, the appeal is partly allowed. The impugned order dated 15/01/2007 passed by the Income Tax Tribunal, Panaji in ITA No. 24/PNJ/2005 is quashed and set aside. The appeal is restored to the file of the Tribunal. The Tribunal is directed to decide the appeal afresh on all issues after hearing the parties. As the appeal pertains to assessment year 1996-97, the Tribunal is directed to dispose of this appeal as expeditiously as possible. Tata Teleservices vs. Union of India and Ors. (05.02.2016 - GUJHC) : MANU/GJ/0122/2016 10. All these petitions are opposed by Mr. M.R. Bhatt, learned counsel appearing on behalf of the revenue -Income Tax Department. 10.01. Mr. M.R. Bhatt, learned counsel appearing on behalf of the revenue has veheme....
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.... learned counsel appearing on behalf of the revenue has further submitted that earlier provision had bifurcation as contained in clauses (i) and (ii) of sub- section (3) with regard to statement being filed, payment made or credit given. It is submitted that as compared thereto, the legislature has done away with this distinction and the amendment prescribes a common period of limitation so as to align the time limit with the provision of Section 148 of the Act. 10.04. Mr. M.R. Bhatt, learned counsel appearing on behalf of the revenue has heavily relied upon the Memorandum to the Finance Bill (No.2) 2014. It is submitted that in the Memorandum it is specifically noted that as TDS defaults are generally in respect of the transaction not reflected in the TDS statement, it is proposed to omit clauses (i) and (ii) of sub-section (3) of Section 201. 10.05. Mr. M.R. Bhatt, learned counsel appearing on behalf of the revenue has vehemently submitted that the legislature can provide for a larger period of limitation. In support of his above submission, he has heavily relied upon the following decisions of the Hon'ble Supreme Court:-- "(1). ....
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....on the assessing officer not to issue a notice after an expiry of two years. It is submitted that it is only by reason of this negative proviso that petition came to be allowed by the Court as can be seen from para 3 of the judgment. It is submitted that In the present case, there is no such negative proviso. It is submitted that in fact in the said decision also in para 5, the Hon'ble Supreme Court has observed that "there was no scope for issuing a notice unless the Legislature expressly gave power to the Income Tax officer to issue notice under the amended section notwithstanding the expiry of the period under the unamended provision or unless there was overlapping of the period within which notice could be issued under the old and the amended provision". 10.10. Mr. M.R. Bhatt, learned counsel appearing on behalf of the revenue has further submitted that the decision of the Hon'ble Supreme Court in the case of K.M. Sharma (supra), which has been heavily relied upon by the learned advocate appearing on behalf of the petitioners, shall not be applicable to the facts of the case on hand. It is submitted that in the aforesaid decision in the case of Ahmedabad Manufa....
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....ole or any part of the tax] or after deducting fails to pay the tax as required by or under this Act, he or it shall be liable to pay simple interest at one per cent for every month or part of a month on the amount of such tax from the date on which such tax was deductible to the date on which such tax is actually paid and such interest shall be paid before furnishing the quarterly statement for each quarter in accordance with the provisions of sub-section (3) of section 20; (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 (IA) shall be a charged upon all the assets of the person, or the company, as the case may be. referred to in sub- section(1)." 12.02. Subsequently, section 201 of the Act came to be amended. Sub-sections (3) and (4) came to be introduced w.e.f. 1/4/2010. Section 201 as amended by Finance Act No. 2 of 2009 w.e.f. 1/4/2010 reads as under : "201. (1) Where any person, including the principal officer of a company - (a) who is required to deduct any sum in accordance with the provisions of this Act; or ....
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....financial year commencing on or before the 1st day of April, 2007 may be passed at any time on or before the 31st day of March, 2011. (4). The provisions of sub-clause (ii) of sub- section (3) of section 153 and of Explanation 1 to section 153 shall, so far as may, apply to the time limit prescribed in sub-section (3)." 12.03. Subsequently, section 201(3)(ii) of the Act came to be amended by Finance Act of 2012 with retrospective effect from 1/4/2010 whereby in sub-section (3) in clause (ii) words "four years" came to be substituted by words "six years". Amended section 201(3) reads as under : 12.04. Subsequently, section 201(3)(ii) of the Act, was amended by Finance Act, 2012, with retrospective effect from 01/04/2010, whereby in sub-section (3), in clause (ii), for the words 'four years", the words "six years" shall be substituted. The amended Section 201(3) read as under: "201(3). No order shall be made under sub- section (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 any time after the expiry of - (i) two years from the end of the financ....
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....a financial year commencing on or before the 1st day of April 2007 may be passed at any time on or before 31st day of March, 2011. As per Memorandum of Finance Bill No. 2 of 2009, in respect of F.Y.2007- 08 and earlier years only proceedings that were pending could be completed by 31/3/2011 and as such no fresh proceedings could be commenced for the said period. 12.08. The reasons for amendment so stated in the memorandum to the Finance Bill No. 2 of 2009 reads as under; "Providing time limits for passing of orders u/s. 201(1) holding a person to be an assessee in default. Currently, the Income Tax Act does not provide for any limitation of time for passing an order u/s. 201(1) holding a person to be an assessee in default. In the absence of such a time limit, disputes arise when these proceedings are taken up or completed after substantial time has elapsed. In order to bring certainty on this issue, it is proposed to provide for express time limits in the Act within which specified order u/s. 201 (1) will be passed. It is proposed that an order u/s. 201(1) for failure to deduct the whole or any part of the tax as required under....
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.... time limit provided under section 201(3)(ii) of the Act for passing order under section 201(1) of the Act came to be extended by one year and it also provides that no orders shall be made under sub- section (1) holding a person to be in default for failure to deduct whole or part of the tax from a person resident in India at any time after expiry of seven years from the end of the financial year in which payment is made or credit is given. 12.12. By Finance Act No. 2 of 2012, even distinction between the cases, statement has been filed and where such statement was not filed also has been removed and the amendment prescribes a common period of limitation i.e. seven years from the end of the financial year in which payment was made. 12.13. The reasons for amendment in section 201(3) so stated in the memorandum to the Finance Bill No. 2 of 2014 reads as under : "Tax Deduction at Source : Under Chapter X Vll-B of the Act. a person is required to deduct tax on certain specified payments at the specified rates if the payment exceeds specified threshold. The person deducting tax ("the deductor") is required to 'file a quarterly statement of tax ded....
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....nancial year in which payment/credit is made for passing of order under section 201(1) of the Act for cases in which TDS statement has not been filed. However, notice under section 148 of the Act may be issued for reassessment up to 6 years from the end of the assessment year for which the income has escaped assessment. Therefore, section 148 of the Act allows reopening of cases of one more preceding previous year than specified under section 201(3) (ii) of the Act. Due to this, order under section 201(1) of the Act cannot be passed in respect of defaults relating to TDS which comes to the notice during search/reassessment proceeding in respect of previous year which is not covered under section 201(3)(ii) of the Act for passing order under section 201(1) of the Act shall be extended by one more year. The existing provisions of section 271H of the Act provides for levy of penalty for failure to furnish TDS/TCS statements in certain cases or furnishing of incorrect information in TDS/TCS statements. The existing provisions of section 271H of the Act do not specify the authority which would be competent to levy the penalty under the said section. Therefore, provisions ....
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....t from 1/4/2010, it is to be held that section 201(3), as amended by Finance Act No. 2 of 2014 shall not be applicable retrospectively and therefore, no order under section 201(i) of the Act can be passed for which limitation had already expired prior to amended section 201(3) as amended by Finance Act No. 2 of 2014. Under the circumstances, the impugned notices/summonses cannot be sustained and the same deserve to be quashed and set aside and writ of prohibition, as prayed for, deserves to be granted." 7. Counsel for the respondent Mr. Mathur has taken us to the observations of AO which reads as under: We are enclosing herewith the Income Tax Returns of 27 pensioners for the F.Y. 2007-08 to the extent we could collect from the pensioners which are still in touch with our university. We are also providing you the PAN of 9 pensioners which will help your good self to verify about the status of their Income Tax Return for the year 2007-08. The pension amount mentioned by your good self is exclusive of deduction available to pensioners under chapter VI of the I.T. Act, 1961. There is possibility that many of them may come out from tax purview after considering chapter VI d....
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....nclosures with supporting documents. In all the cases, the recipient of the income had claimed refund, which had arisen due to tax deducted at source. Therefore, we find no infirmity in the order of the learned Commissioner of Income Tax (Appeals) and the same is hereby sustained." 5.1. He has further relied upon the decision of Gujrat High Court in case of Commissioner of Income Tax vs. Rishikesh Apartments Co-operative Housing Society Ltd. 253 ITR 310 wherein it has been held as under:- "If one looks at the fact whether Ravi Builder had in fact paid the amount of tax payable by it on the amount which was paid to it by the assessee, one finds that Ravi Builder had paid the tax. In fact for both the years, it had paid more advance tax than what was payable by it. Thus, the entire amount of tax which was payable by it had been duly paid. Had Ravi Builder not paid tax on the amount which it had received from the assessee, the Revenue could surely saddle the assessee with the liability of payment of interest under the provisions of Section 201(1A) of the Act. But in the instant case, as Ravi Builder had already paid the tax on the income, in our opinion, there was no....
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....evenue to levy any interest under Section 201(1A) of the Act especially when Ravi Builder had paid more amount of tax by way of advance tax than what was payable by it. As the amount of tax payable by the contractor had already been paid by it and that too in excess of the amount which was payable by way of advance tax, in our opinion, the Tribunal was absolutely right in holding that the tax paid by the contractor in its own case, by way of advance tax and self-assessment tax, should be deducted from the gross tax that the assessee should have deducted under Section 194C of the Act while computing interest chargeable under Section 201(1A) of the Act. If the Revenue is permitted to levy interest under the provisions of 201(1A) of the Act, even in a case where the person liable to pay the tax has paid the tax on the date due for the payment of the tax, the Revenue would derive undue benefit or advantage by getting interest on the amount of tax which had already been paid on the due date. Such a position, in our opinion, cannot be permitted. 6. In that view of the matter, the view taken by the jurisdiction High Court is required to be accepted and hence, the appe....