2015 (8) TMI 1375 - AT - Income Tax

Jurisdiction of CIT(A) Noida to pass the order and deletion of demand created by the Addl.CIT(TDS) Ghaziabad u/s 201(1) and 201(1A)- failure of the assessee to deduct tax at source from the interest paid by it to New Okhla Industrial Development Authority (NOIDA). Held that - In Addl. CIT(TDS) Ghaziabad vs. Canara Bank, Noida 2015 (8) TMI 415 - ITAT DELHI held that between the period 5.6.2014 to 15.11.2014, the jurisdiction of the first appellate authority to pass the orders against the orders of the Addl.CIT (TDS), Ghaziabad rested with the CIT(A), Ghaziabad and for the periods prior to 5.6.2014 and after 15.11.2014, it vested in CIT(A), Noida. It has, therefore, been held that only the CIT(A), Noida had rightful jurisdiction over the appeal emanating from the order passed by the Addl. CIT(TDS), Ghaziabad. On merits, it has been held that the payment of interest by the banks to NOIDA does not require any tax withholding as the same is covered u/s 194A(3)(iii)(f). Resultantly, the order passed by the Addl CIT(TDS) u/s 201(1) and 201(1A) read with section 194A has been set aside. - Decided in favour of assessee

Summary

Issues: Jurisdiction of CIT(A) and Deletion of demand under Income-tax Act, 1961

Jurisdiction of CIT(A):
The appeal by the Revenue raised two issues - the jurisdiction of the CIT(A), Noida to pass the order and the deletion of demand created by the Addl.CIT(TDS) Ghaziabad under sections 201(1) and 201(1A) of the Income-tax Act, 1961. The Tribunal proceeded ex parte as there was no appearance from the side of the assessee. Simultaneously with this appeal, another appeal was heard, establishing that the jurisdiction to pass orders against the Addl.CIT(TDS), Ghaziabad rested with the CIT(A), Ghaziabad for a specific period. For the relevant period, it was held that only the CIT(A), Noida had the rightful jurisdiction over the appeal. The Tribunal concluded that the payment of interest by banks to NOIDA did not require tax withholding under section 194A(3)(iii)(f), setting aside the order passed by the Addl.CIT(TDS) under sections 201(1) and 201(1A) read with section 194A.

Deletion of Demand:
The Tribunal, after considering the facts and circumstances of the case, found them similar to another appeal. Following the decision in that appeal, the Tribunal decided both issues against the Revenue. It was directed that the assessee bank could not be treated as an assessee in default under sections 201(1) and 201(1A) of the Income-tax Act, 1961. Consequently, the appeal by the Revenue was dismissed, and the order was pronounced in open court on 07.08.2015.