2020 (11) TMI 221

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....of Section 194A of the Income Tax Act 1969. B. On the facts and in the circumstances of the case and in law the Commissioner of Income-tax (Appeals) erred in arriving into a conclusion that the Income tax Officer (TDS) is an authority to call for information under Section 133(6) of Income tax Act without appreciating the fact that the power to call for information under section 133(6) is vested on the Assessing Officer, the Deputy Commissioner (Appeals), the Joint Commissioner or the Commissioner (Appeals) and therefore the Income Tax Officer (TDS) is not an authority to invoke provision under the said section. C. The Commissioner of Income-tax (Appeals) ought to have seen that the information under Section 133(6) shall be called for only for the purpose of the Income Tax Act 1961 and no such purpose was mentioned in the notice issued by the Income Tax Officer (TDS), Kottayam. D. The Commissioner of Income-tax (Appeals) ought to have seen that the information called for under Section 133(6) should be useful for, or relevant to any enquiry as instructed in Para 4.3 of Chapter 4 of Manual of Office Procedure which states that the Assessing Officer, the Addl....

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.... "This appeal filed by the assessee has been posted on multiple occasions. On 12.10.2020, a person claiming to be Shri T.C. Vinod, Secretary of the Kaduthuruthy Regional Service Co-Operative Bank, had participated in the video hearing. He was directed to file his authorisation for representing the appeal. He submitted that other than what is raised in the grounds of appeal, the assessee has nothing more to submit. In reply to queries from the SMC the response was "no comments". The appeal was adjourned to 27.10,2020. Till date no authorisation has been received. Further, it is noticed that the issues in the appeal are covered by the decision of the Coordinate Bench of this Tribunal in the following cases: 1. ITA No. 473/Coch/2015 : Kakoor Service Co-Operative Bank Ltd. 2. ITA No. 243/Coch/2013 : Panangad Service Co-Op. Bank Ltd. 3. ITA No. 544/Coch/2015 : Muhamma Service Co-Op. Bank Ltd. 4. ITA No. 190/Coch/2016 : Udayamperoor Service Co-Op. Bank Ltd. 5. ITA No. 126/Coch/2017 : Puthucode Service Co-Op. Bank Ltd. 6. ITA No. 158/Coch/2017 : Elavally Service Co-Op. Bank Ltd. 7. ITA No. 153/Coch/2017 : Vallapuzha Se....

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....termine through general enquiry for the purpose of identifying persons who are likely to have taxable income and whether they are in compliance of the Act. Here in the present case notice under Section 133(6) had been issued to the assessee seeking for the details of the persons to whom interest payment exceeding 􀀀10,000/- was made by the appellant for the specified period. The claim of the assessee that they did not have to deduct TDS as they are exempt is in fact a contumacious act in direct defiance against the provisions of the law. It was the submission that under no stretch of imagination can it be even presumed that the assessee did not know of the decision of the Hon'ble Supreme Court in the case of Kathiroor Service Co-Operative Bank Ltd. nor is it a plausible explanation that the assessee is exempt from deducting TDS in the absence of any order thereto. It was the submission that such contumacious conduct on the part of the assessee is liable to be dealt with harshly. It was the submission that the orders of the learned CIT(A) and that of the AO are liable to be upheld. It was further submitted that the penalty levied under Section 272A(2)(c) of the Act is li....

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....dding the '2nd proviso' to the said provision, with effect from 1. 7.1995. The effect of the said amendment is that, the power to call for information under the unamended Act, which was confined only in relation to a 'pending proceeding' came to be widened, and even in a case where no proceeding was pending, such information could be called for as part of the enquiry, subject to the rider that, such power was not to be exercised by any income tax authority below the rank of Director or Commissioner without the prior approval of the Director or the Commissioner, as the case may be. The said amendment was brought about as a measure to tackle tax evasion effectively, as clarified by the Central Board of Direct Taxes (CBDT) vide Circular no. 717 dated 14.8.1995 , which reads as follows: "Power to call for information when no proceeding is pending.- . 41.2 At present the provisions of sub-section (6) of section 133 empower Income-tax authorities to call for information which is use ful for, or relevant to, any proceeding under the Act which means that these provisions can be invoked only in cases where the proceedings are pending and not otherwise. This....

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....nsactions or deposits of Rs. 1,00,000 or above for a period of three years, without reference to any proceeding or enquiry pending before any authority under the Act. Admittedly, in the present case, notice was issued only after obtaining approval of the Commissioner of Income-tax, Cochin. In the light of the aforesaid, we are of the considered opinion that the assessing authority has not erred in issuing the notice to the assessee-financial institution requiring it to furnish information regarding the account holder with cash transactions or deposits of more than Rs. 1,00,000. 21. Therefore, we hold that the Division Bench of the High Court was justified in its conclusion that for such enquiry under section 133(6) the notice could be validly issued by the assessing authority. 22. In view of the above, the appeal requires to be dismissed and accordingly, stands dismissed." 8.3 In the light of the judgment of the Hon'ble Apex Court (supra) and the aforesaid reasoning, I am of the view that the ITO (Intelligence) has jurisdiction to issue notice u/s 133(6) of the I T Act. (ii) the order passed u/s 272A(2)(C) is barred by limitation; 8.4 Se....