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2018 (12) TMI 1635 - AT - Income TaxRectification u/s 254 - provisions of section 194H/40(a)(ia) was not adjudicated by the Tribunal - DR submitted that this is the case where a sum of ₹ 60 lakhs was paid by the assessee to M/s. Global Properties towards nomination fees for release of rights without making TDS - HELD THAT - The issue of applicability of provisions of section 194H r.w.s. 40(a)(ia) was not adjudicated by the CIT(A) as he confirmed the addition on merits holding that the payment of ₹ 60 lakhs is non-genuine transactions. Ideally, the Revenue should have filed an appeal against the said finding of the CIT(A). Without prejudice to the finding of the CIT(A) on merits of genuineness of transactions, Revenue did not file any appeal before the Tribunal on this issue. While adjudicating the ground of the assessee, the Tribunal decided the issue in favour of the assessee upholding the genuineness of transaction. Thus, raising this issue i.e. applicability of the provisions of section 194H r.w.s. 40(a)(ia) to the said genuineness of transaction as held by the Tribunal cannot be raised through this Miscellaneous Application route in the context of appeal of the assessee. Accordingly, the issue raised by the Revenue on merits stands dismissed. Miscellaneous Application filed by the Revenue is dismissed.
Issues Involved:
1. Delay in filing the Miscellaneous Application. 2. Merits of the mistake regarding the applicability of provisions of section 194H/40(a)(ia) of the Income Tax Act. Detailed Analysis: Preliminary Issue: Delay in Filing the Miscellaneous Application The Revenue argued that the delay in filing the Miscellaneous Application should be calculated from the date of receipt of the Tribunal's order by the Pr. CIT-1, Pune, not from the date of the Tribunal's order. The Revenue cited the Tribunal's Chandigarh Bench decision in the case of Jagmohan Gurbakshish Singh vs. DCIT and the Hon’ble Gujarat High Court decision in Peterplast Synthetics (P) Ltd. vs. ACIT, which supported the view that the limitation period commences from the date of dispatch or receipt of the order. The Revenue thus contended that there was no actual delay in filing the application. Conversely, the assessee relied on the Pune Bench decision in Shri Kasturilal Sardarilal Luthra vs. DCIT, which held that the limitation period starts from the end of the month in which the Tribunal passed the order. The Tribunal emphasized that it does not have the power to condone delays in filing Miscellaneous Applications. The Tribunal noted the divergent views from different benches and ultimately found that the decision of the Gujarat High Court in Peterplast Synthetics (P.) Ltd. pertained to pre-amended provisions of section 254(2) of the Act. The Tribunal concluded that the present Miscellaneous Application suffered from a limitation issue and dismissed the preliminary issue of delay. On Merits: Applicability of Provisions of Section 194H/40(a)(ia) The Revenue claimed that the Tribunal did not adjudicate the issue of invoking provisions of section 194H/40(a)(ia) of the Act concerning a payment of ?60 lakhs made by the assessee to M/s. Global Properties without TDS deduction. The Revenue argued that this payment should be treated as a commission subject to TDS under section 194H. The assessee countered that the payment was compensation and not subject to TDS. The CIT(A) dismissed the Revenue's argument by holding the transaction as non-genuine. The Revenue did not appeal this finding but raised the issue in the Miscellaneous Application. The Tribunal observed that the CIT(A) did not adjudicate the applicability of section 194H/40(a)(ia) since the addition was confirmed on the ground of non-genuineness. The Revenue should have appealed the CIT(A)'s finding on genuineness. The Tribunal held that the issue of TDS applicability could not be raised in the Miscellaneous Application in the context of the assessee's appeal. Conclusion: The Tribunal dismissed both the preliminary issue of delay and the merits of the mistake regarding the applicability of section 194H/40(a)(ia) of the Act. The Miscellaneous Application filed by the Revenue was thus dismissed in its entirety. Order Pronounced on 17th December 2018.
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