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TMI Blog2016 (2) TMI 296X X X X Extracts X X X X X X X X Extracts X X X X ..... 101/CIT(A)-XIX/Wd-57(2)/Kol/11-12 dated 08.01.2013. Assessments were framed by ITO Ward-57(2), Kolkata u/s 206C(7) of the Income Tax Act, 1961 (hereinafter referred to as 'the Act') vide his order dated 10.11.2008 for assessment years 2007-08 and 2008-09 respectively. 2. Since common grounds are involved except the change of the figures in all these appeals, therefore, they were heard together and are being disposed of by this common order for the sake of convenience. Hence, we take the lead case in ITA No.573/Kol/2013 for A.Y. 2007-08 and reproduced the grounds as under:- 1. Ground No. 1 That on the facts in the circumstances of the case and in law, the Ld. CIT(Appeals) has erred in confirming the order of Assessing Officer on account of TCS interest on TCS assessed u/s 206(6) 206C(7). 2. Ground No. 2 That on the facts circumstances of the case in law, the Ld. CIT(Appeals) has misinterpreted the provision of Sec. 206C(6) 206C(7). 3. Ground No. 3 That on the facts circumstance of the case, the Ld. CIT (Appeals) has failed to apply his mind in the facts, and the documents as evidence produced by the appellant assessee. 4. Ground No. 4. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 0.50% 37,079/- 9 Naini Plywood Pvt. Ltd. 0.30% 27,034/- 10 M.B. Enterprises 2.5% 2,09,970/- 11 D.D. Enterprises 0.35% 93,894/- 12 R.M.C. power Recovery (India) Pvt. Ltd. 2.5% 12,16,089/- 38,34,653 Add: Sc 95,691 On query for said default, assessee submitted that buyers of the timber have paid the taxes in their respective returns of income, so assessee should not be treated as assessee in default. However, AO has rejected the claim of assessee by holding that assessee has grossly violated the provisions of Sec. 206C of the Act. Accordingly, AO disallowed the sum of ₹ 39,30,344/- and added it to the income of assessee. 4. Aggrieved, assessee preferred an appeal before Ld. CIT(A) and submitted that all the parties to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oration (deductee) was in fact rent and TDS should have been deducted u/s. 194I at higher rate than the tax deducted by the deductor @ 2% treating it as contractual payment. It is in this background and fact that the Hon'ble Supreme Court held that no further tax could be recovered from the deductor once it has been paid by the deductee along with interest u/s. 201(1A) of the I.T. Act. The Hon'ble Supreme Court, however approved the action of the AO in treating assessee as assessee in default. 18. The facts of the case of the assessee is entirely different than in the case of Coca Cola (P) Ltd. The assessee has not complied with the provisions of TDS and even after getting sufficient opportunity failed to produce any evidence that the tax has already been paid by the deductee. On the basis of above judgement of Coca Cola even if it is presumed that the deductee has already paid the tax the assessee cannot get relief on the basis of such judgment because of gross violation of TDS provision with no direct proof that the deductee has already paid the tax in contrast to case of Coca Cola (P) Ltd, where there was honest violation of TDs provision. In view of above stated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on (1D), responsible for collecting tax in accordance with the provisions of this section, who fails to collect the whole or any part of the tax on the amount received from a buyer or licensee or lessee or on the amount debited to the account of the buyer or licensee or lessee shall not be deemed to be an assessee in default in respect of such tax if such buyer or licensee or lessee- (i) Has furnished his return of income under section 139; (ii) Has taken into account such amount for computing income in such return of income; and (iii) Has paid the tax due on the income declared by him in such return of income; We also relied on the order of ITAT Ahmedabad A Bench in the case of K.P.G. Enterprise v. ITO in ITA No. 2384/Ahd/2012 dated 14.08.2012 for the A.Y. 2010-11 extracted in para 20 and 21, which is reproduced below:- 20. Rajkot Special Bench of the Tribunal in the case of Bharti Auto Products Vs. CIT (supra) has held as under:- The first proviso inserted in sub-section (6A) of section 206C seeks to (1) ensure that there is no loss to the Revenue, i.e. (i) the buyer has furnished his return of income under section 139, (ii) the buyer has taken into ..... X X X X Extracts X X X X X X X X Extracts X X X X
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