2023 (2) TMI 503

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....1 (the Act) concerning AY 2011-12. 2. The grounds of appeal raised by the assessee read as under: "That on the facts and in the circumstances of the case, the order passed by the learned Commissioner of Income Tax (Appeals) (hereinafter referred as "Ld. CIT(A)") in confirming the action of AO of holding the appellant as assessee in default u/s 201(1) in a arbitrary and mechanical manner is bad, both in the eyes of law and on facts. 2. That on the facts and in the circumstances of the case, the Ld. CIT(A) erred in confirming the action of AO of raising demand of Rs 2,78,645/- by holding the appellant as assessee in default u/s 201(1) on account of short deduction of tax at source on Common Area Maintenance Charges paid a....

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.... the allegation of the Revenue that the assessee is in default under Section 201(1) on account of short deduction of tax at source on Common Area Maintenance [CAM] charges paid by the assessee. 4. Briefly stated, a TDS survey under Section 133A(2A) was carried out in the case of Ambience Group on 12.02.2018. A survey action carried out on two malls namely, Abmience, Gurgaon and Ambience Mall, Vasant Kunj revealed that mall owners have collected/recovered expenses in the form of common area maintenance charges on which TDS deduction has been carried out at 2% by the payers under Section 194C of the Act as against 10% deductible under Section 194I of the Act. Consequently, the Assessing Officer passed an order under Section 201(1)/201(1A) ....

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....e entity namely, Ambience Facilities Management Pvt. Ltd. A reference was further made to the decision of the Co-ordinate Bench in ITA No.889/Del/2020, Kapoor Watch Co. Pvt. Ltd. vs. ACIT, order dated 05.01.2021 wherein the Tribunal examined the issue of short deduction of tax and held that the assessee cannot be regarded as the assessee in default under Section 201(1) of the Act in the similar circumstances. The relevant operative paragraph of the Coordinate Bench is reproduced hereunder: "7. We have heard both the parties and perused the material available on record. Ground Nos. 1 and 1.1 are general in nature hence not adjudicated upon. As regards as Ground Nos. 2, 2.1, 2.2 and 3, it is pertinent to note that the assessee compan....