2015 (1) TMI 308 - AT - Income Tax

Non deduction of TDS u/s 194J relied upon certificate issued u/s 197 - Admission of additional evidence - Held that - CIT(A) allowed the appeals of the assessee based on the certificates issued by the AO u/s 197 of the Act. In view of the certificate issued by the AO u/s 197 of the Act, the assessee was not required to deduct tax at source as per provisions of section 194C and 194J in respect of impugned payments. The CIT(A), in order to verify the authenticity of certificate issued u/s 197 of the Act called for a remand report from the AO. Since the remand report was not received, the CIT(A) allowed the case of the assessee. Even before us the revenue has not called in question the authenticity of the certificate issued u/s 197 of the Act by the concerned AO. Hence we see no reason to interfere with the order of the CIT(A). Therefore we uphold the order of CIT (A) as correct and in accordance with law - Decided against Revenue.

Summary

Issues:
- Appeal against CIT(A) order deleting TDS demand for FY 2008-09 and 2009-10
- Acceptance of additional evidence without giving opportunity to AO

Analysis:
1. TDS Demand for FY 2008-09 and 2009-10:
- The appeals were against the CIT(A) order canceling demands of Rs. 4,90,354 for FY 2008-09 and Rs. 53,21,444 for FY 2009-10 related to TDS liability under section 194J of the IT Act.
- The CIT(A) allowed the appeals based on TDS certificates obtained by the assessee under section 197 of the IT Act, indicating no TDS required for payments under sections 194C and 194J.
- The AO had not complied with the remand report request by the CIT(A) to verify the authenticity of the certificates, leading to the demands being reduced to NIL based on the certificates.
- The Tribunal upheld the CIT(A)'s decision, stating that since the revenue did not question the authenticity of the certificates issued by the AO under section 197, there was no reason to interfere with the CIT(A)'s order.

2. Acceptance of Additional Evidence:
- The grounds of appeal also raised the issue of the CIT(A) accepting additional evidence from the assessee without giving the AO an opportunity as required under Rule 46A of the IT Rules 1962.
- However, the judgment did not delve into this issue specifically, as the focus was on the validity of the TDS certificates and the resulting cancellation of demands.

In conclusion, the ITAT Delhi upheld the CIT(A)'s decision to cancel the TDS demands for the relevant years based on valid TDS certificates obtained by the assessee under section 197 of the IT Act. The Tribunal found no reason to interfere with the CIT(A)'s order, as the revenue did not challenge the authenticity of the certificates. The issue of accepting additional evidence was not extensively discussed in the judgment as the main focus was on the TDS liability and the certificates' impact on the demands.