AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2024 (7) TMI 573
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....g with his brother Shri Nitin Kabra has purchased an immovable property worth Rs. 65,11,000/- from UIT Bhilwara on 30.07.2013. The ld. ITO, Bhilwara submitted that as per provisions of sub-section (1) of section 194-IA of the Income Tax Act, 1961, any person, being a transferee, responsible for paying (other than the person referred to in section 194LA) to a resident transferor any sum by way of consideration for transfer of any Immovable Property (other than Agricultural Land), shall, at the time of credit of such sum to the account of the transferor or at the time of payment of such sum in cash or by issue of a cheque or draft or by any other mode, whichever is earlier, deduct an amount equal to one percent of such sum as Income-tax thereon. Further, sub-section (2) of section 194-IA states that no deduction under sub-section (1) shall be made where the consideration for the transfer of an immovable property is less than fifty lakh rupees. On verification from OLTAS as well as 26AS Form, it reveals that the Diductor assessee had not Deducted Tax at Source whereas she was liable to Deduct Tax at Source @ 1% оn the value of Immovable Property purchased. Based on this, the ld.....
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.... ld. NFAC before this tribunal on the grounds as reiterated in para 2 above. To support the grounds so raised the ld. AR appearing on behalf of the assessee has placed reliance on the written submission which is extracted herein below:- "Fact of Case: In the above referred appeal assessee has purchased jointly an residential immovable land, Plot No. 1-V-33, Cornor, R.C. Vyas Colony, Bhilwara having measurement 237.5 Sq. yard has been allotted from UIT Bhilwara on 26.06.2013 of which total payment Rs. 6511000/- made by 30.07.2013 in which he is equally owner with his brother Shree NITIN KABRA and paid half portion of his share in plot is Rs. 3255500/- and balance Rs. 3255500/- paid by his brother and got registered in their both name. The AO vide his order dated 22-02-2021 has not accepted the submissions and facts related to case and made the addition which is bad in law. Thereafter assessee has made an appeal in CIT (Appeals), NFAC who had also vide its order dated 28.02.2023 dismiss the appeal against the assessee and kept demand standing which is against the provision of act and unwarranted. The CIT (Appeal) has erred in dismissing of appeal which is against the provisio....
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....ees." The assessee has referred following case laws which are relevant to the case, however not accepted the contains refer therein which is bad in law: 1. Vinod Soni vs. ITO Tds, Faridabad, ITA No. 2736/Del/2015, ITAT Delhi Bench 'B'. 2. Shree Shambhu Dayal Sarrad, Jaipur vs. ITO Ward-7(1), jaipur, ITAT Jaipur bench. 3. Smt. Sandhya Gugaliya-Jaipur vs. DCIT, CPC-TDS, Ghaziabad, UP by ITAT Jaipur Bench, Jaipur. 4. Smt. Sapna Sanjay Raisoni, Pune vs. ITO Ward-2(1), Pune, ITA No. 1267 to 1269/PN/2014. 5. M/s Oxcia Enterprises Pvt. Ltd. Vs. DCIT, Circle-TDS, Udaipur, ITAT Jodhpur under ITA No. 291/Jodh/2018. 6. The Desion of ITAT, Jodhpur in the identical case of Dalpat Singh Nanecha, Bhilwara vs ITO, Tds, Bhilwara (ITA. No. 245/JODH/2019 Assessment Year: 2015-16) The identical case of Dalpat Singh Nanecha, Bhilwara vs ITO, Tds, Bhilwara is not considered wherein the Sales party is also UIT, Bhilwara and facts are identical to the assessee case. The gits of case are produced as under: The appellant (Rajesh Kumar Nahar) has purchased a property jointly with his wife and two partners namely Dalpat Singh Nanecha and Reetu Devi Nanecha on 03.09.2014 from UIT, Bhi....
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....) dated 19.01.2017 and 27.12.2018 to the appellant for non- deduction of tax at source at the time of purchase of an immovable property of more than Rs. 50 lacs as per the provisions of section 194-IA of the Act. The then Authorized representative of the appellant filed the written submission in response to the show cause notice. In the written submission of appellant AR, it was submitted that the provisions of the section 194-IA of the Income Tax Act 1961 is not applicable in the instant case since the appellant has paid only Rs. 33,55,500/- as his share of consideration of the immovable property to the transferor i.e., UIT Bhilwara which is below the threshold limit of Rs. 50 Lacs as per the section 194-IA (2) of the Act. However, the ITO (TDS) Bhilwara has rejected the contention of the appellant and passed the order by treating the appellant as "Assessee in default" in terms of the provisions of section 201(1) of the Act for not deducting the tax at source as required u/s 194-IA of the Act on his share of Rs. 32,55,500/- (1/2 share of Rs. 65,11,000/-) and u/s 201(1A) of the Act for liable to pay simple interest on tax liability of Rs. 32,555/-. 1.3 Being aggrieved from the or....
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.... (b) "immovable property" means any land (other than agricultural land) or any building or part of a building. From the perusal and plain reading of the above provision of section 194- IA of the Income tax Act 1961, it is very clear and settled law of the position that for deducting tax at source on transfer of immovable property other than agricultural land, three conditions must be satisfied which are reproduced as under a) Consideration for transfer should be paid by any person "being a transferee". Here the Act does not used the word transferee(s) b) Consideration for transfer should be paid to resident transferor. c) No deduction of tax shall be made where the consideration for transfer of an immovable property is less than Rs. Fifty lacs. In the present case, the appellant has satisfied all the three conditions of the provisions of the section 194-IA of the Act. 1. Appellant i.e., Shri Sachin Kumar Kabra is resident Indian having Individual PAN holder being a person as defined in section 2(31) of the income tax Act 1961 and Joint transferee along with his Brother Shri Nitin Kumar Kabra and same fact has been admitted by the ITO (TDS) Bhilwara and uphold by the res....
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....the Finance Bill wherein it was stated that "in order to reduce the compliance burden on the small tax payers, it is further proposed that no deduction of tax under this provision shall be made where the total amount of consideration for the transfer of an immovable property is less than fifty lakhs rupees. We further find that the main reason by the AO is that the amount as per sale deed is Rs. 1,50,00,000/-. The law cannot be interpreted and applied differently for the same transaction, if carried out in different ways. The point to be made is that, the law cannot be read as that in case of four separate purchase deed for four persons separately, Section 194-LA was not applicable, and in case of a single purchase deed for four persons Section 194-IA will be applicable. It is noted that AO has passed a common order u/s. 201(1) for all the four transferees. In order to justify his action since in case of separate orders for each transferee separately, apparently. provisions of section 1941A could not had been made applicable since in each case purchase consideration is only Rs. 37,50,000/- This action of AO shows that he was also clear in his mind that with reference to each transf....
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....ee and the second factor fixes obligation to deduct tax at the time of credit or payment. When read combinedly; while the first limb of Section 1941A refers to a singular expression, i.e., 'transferee' (in distinction to transferee(s) combined), second limb provides for time of discharge of obligation which in turn, depends on the action of each transferee (in exclusion to other transferee) i.e., either credit in its accounts or actual payment. Thus, when the provision is read as a whole, it gives an infallible impression that obligation cast under Section 1941A is qua each transferee and not qua the aggregate consideration. The reasons are not far to seek. It will not be practicable to achieve the requirement of second limb if the case of the Revenue is accepted that it is qua total consideration involved and not each transferee. The obligation cast under Section 1941A arises to a particular transferee at the time of payment of consideration or at the time of credit in its own accounts. 7.3 The law cannot be read to expect one transferee to deduct TDS on behalf of other transferee at the time action taken by him towards payment or credit. If the contentions of the Revenu....
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....00,000/-. The provision of the section 194-IA on this aspect is required to be seen to decide the issue on hand:- Payment on transfer of certain immovable property other than agricultural land25. 194-IA. (1) Any person, being a transferee, responsible for paying (other than the person referred to in section 194LA) to a resident transferor any sum by way of consideration for transfer of any immovable property (other than agricultural land), shall, at the time of credit of such sum to the account of the transferor or at the time of payment of such sum in cash or by issue of a cheque or draft or by any other mode, whichever is earlier, deduct an amount equal to one per cent of such sum 26[or the stamp duty value of such property, whichever is higher,] as income-tax thereon. (2) No deduction under sub-section (1) shall be made where the consideration for the transfer of an 26a[immovable property and the stamp duty value of such property, are both,] less than fifty lakh rupees. (3) The provisions of section 203A shall not apply to a person required to deduct tax in accordance with the provisions of this section. Explanation.-For the purposes of this section,- (a) "agricultur....