2019 (6) TMI 1548 - AT - Income Tax

Non deduction of TDS u/s.194C - payments made by assessee joint venture to its members - assessee is an AOP engaged in the activity of civil contractors - HELD THAT - Structures of section 40(a)(ia) are diluted in the facts of the case since the payee has admittedly filed its return of income disclosing the impugned receipts and income earned by it embedded in the receipt has been duly offered for taxation. Assessee Joint Venture cannot be treated as assessee in default in view of the decision in the case of CIT Vs. Ansal Land Mark Township (P.) Ltd. 2015 (9) TMI 79 - DELHI HIGH COURT and the decision of the Co-ordinate Bench of the Tribunal in the case of ITO vs. Shri Chandrakant J. Mandale 2015 (4) TMI 1140 - ITAT PUNE for the assessment year 2008-09 decided on 10.04.2015, the assesee joint venture cannot be treated as assessee in default . Reverting to the arguments put forth by the Ld. DR regarding distinguishable aspects of the case so far as the facts are concerned, we have perused the orders carefully in the earlier assessment years in assessee‟s own case and the facts are similar in its entirety. We, however, appreciate that on principle; the Ld. DR had fairly conceded that the issue is covered by the decision in assessee‟s own case. - Decided against revenue.

Summary

Issues:
Non-deduction of TDS u/s.194C of the Income Tax Act, 1961 in respect of payments made by assessee joint venture to its members.

Analysis:
The appeal by the Revenue was against the order of the Ld. Commissioner of Income Tax (Appeals) regarding the non-deduction of TDS u/s.194C of the Income Tax Act, 1961 by the assessee joint venture in payments made to its members. The case involved the interpretation of whether the income should be taxed in the hands of the joint venture or its members. The Assessing Officer disallowed the payment made by the joint venture to its members u/s.40(a)(ia) of the Act, adding it to the total income of the assessee. The Ld. Commissioner of Income Tax (Appeals) granted relief to the assessee based on previous judgments and rulings, including the decision of the Hon'ble Andhra Pradesh High Court. The Ld. AR argued that the issue was covered in favor of the assessee by previous decisions of the Tribunal in the assessee's own case.

The Ld. DR contended that the case of the assessee had distinguishable facts but agreed that the issue was covered by previous decisions in the assessee's own cases. The Co-ordinate Bench of the Tribunal, Pune, upheld the findings of the Ld. Commissioner of Income Tax (Appeals) based on previous decisions and rulings. The strictures of section 40(a)(ia) were considered diluted in this case as the payee had disclosed the income earned and offered it for taxation. The Tribunal dismissed the appeal of the Revenue, stating that the issues involved were identical to previous cases and that the findings of the Ld. Commissioner of Income Tax (Appeals) were upheld.

In conclusion, the Tribunal sustained the relief provided by the Ld. Commissioner of Income Tax (Appeals) to the assessee for the assessment year 2013-14 based on previous decisions and rulings. The appeal of the Revenue was dismissed, and the decision was pronounced on June 26, 2019.