TaxTMI 
TaxTMI 
2023 (6) TMI 166
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.... Tax(Appeals) erred in dismissing the appeal and upholding the order of the assessing officer that, the appellant is liable for tax and interest Under section 206C read with 201 and 201(1A) of the Income Tax Act. Ground 3 The Assessing officer erred in holding that the assesse has failed to collect Tax under section 206C and the Ld. Commissioner of Income Tax (A) erred in confirming the said order. The Ld. CIT(A) failed to appreciate that in view of the sale of timber made by appellant for manufacturing and article of things and not for trading purposes, the appellant was not liable to collect Tax at source. Ground 4 The Ld. Commissioner of Income Tax (Appeals) erred in considering form 27C filed by the appellant is substantiate its claim that the timber sold by it where only for the purpose of manufacturing or article. Ground 5 The Ld. CIT erred in holding that, that form 27C are not genuine and the sales reflected in the documents are not reliable at all. Ground 6 The Ld. Commissioner of Income Tax (Appeals) erred in not admitting the evidence in the form of form 27C on the purported ground that, the said form 27Cs are not genuine. Ground 7 The Ld. C....
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....file of the AO for verification and pass order in accordance with various claims made by the assessee including Form 27-C filed during the course of appellant proceedings. During the remand proceedings, the AO observed that the assessee neither complied with provisions of section 206C(1) of the Act, nor 206C(1A) of the Act. Therefore, opined that Form 27C filed subsequent to date of assessment cannot be considered and thus, levied short collection of TCS and interest thereon, as per section 206C(1) of the Act. The relevant findings of the AO are as under: On final hearing posted on 04.12.2015, the Director Shri Praveen Patel along with Representative Shri N. Appadurai appeared furnished the details of sales and Form 27C. They stated that no Form 27C obtained at the time of sale and these were obtained from the purchaser only after sales, which clearly violate the Sec.206C of Income tax Act, 1961. Hence the assessing officer has passed the order by raising the default amount of Rs.38428/-along with interest u/s 201(1)/201(1A) of Rs.13066/-. In this regard, the assessee company files appeal against the order passed by this office before the Commissioner of Income Tax (Appeals) M....
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....btained from the purchaser after the sale is completed. Hence the assessee has clearly failed to comply with the section 206(1) of I.T Act, 1961. After verification of books of accounts and sales details, it is found that the assessee has to be treated as defaulter for an amount of Rs.49179/- being 2.5% of sale value of Rs.1967162/-." 5. Being aggrieved by the assessment order, the assessee preferred an appeal before the CIT(A). Before the ld. CIT(A), the assessee has filed detailed written submissions on the issue, which has been reproduced in para 3 of page 6 to 11 of Ld. CIT(A) order. The sum and substances of arguments of the assessee before the CIT(A) are that, there is no time limit prescribed for filing of Form 27-C and even if said Form has been filed during the course of assessment proceedings, the AO is required to admit and decide the issue. The ld. CIT(A), after considering relevant submissions of the assessee and also taken note of various facts rejected arguments of the assessee and sustained additions made by the AO towards computation of TCS and relevant interest u/s. 206C of the Act. The Ld. CIT(A), had also rejected alternate claim made by the assessee in light ....
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....rson being a seller either shall collect TCS as per the prescribed rate or file Form 27Cas prescribed in the Act. In this case, the assessee neither collects TCS, nor obtained prescribed Form. Therefore, the AO and ld. CIT(A) has rightly rejected arguments of the assessee and their order should be upheld. 8. We have heard both the parties, perused materials available on record and gone through orders of the authorities below. There is no dispute with regard to the fact that the assessee neither collected TCS from the buyer on specified goods at the time of sale or receipt of money from said buyer, nor obtained declaration in specified form as per section 206C(1A) of the Act. The assessee claims to have filed Form 27C as required u/s. 206C(1A) of the Act, at the time of assessment proceedings and argued that there is no time limit for filing said form and even in a case where said forms are filed before completion of assessment, the AO is required to consider the issue. We find that, as per provisions of section 206C(1) of the Act, every person, being a seller shall, at the time of debiting of the amount payable by the buyer to the account of the buyer or at the time of receipt of ....
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.... of the assessee and made additions towards short collection of TCS and interest thereon. 9. Having said so, let us come back to the alternate plea of the assessee. The assessee has taken an alternate plea in the second round of proceedings before the CIT(A) and argued that the assessee is able to collect declaration in Form no. 27BA in terms of provisions of section 206C(6A) and rule 37J of I.T. Rules, 1962, where the Accountant has certified that the purchasers have filed the return of income. We find that first of all, the appellant has taken an alternate plea in second round of litigation in light of Form no 27BA from the Accountant, in terms of section 206C(1A) of the Act and rule 37J of IT Rules, 1962 dated 24.04.2021. In our considered view, as per provisions of section 206C(1A), and proviso provided therein, if the buyer has furnished his return of income u/s. 139(1) of the Act, and has taken into account such amount for computing income in such return of income and has paid the tax due on the income declared by him in such return of income and also furnishes a certificate to this effect from an accountant in such form as may be prescribed, then the assessee shall not be t....