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TMI Blog2016 (7) TMI 68X X X X Extracts X X X X X X X X Extracts X X X X ..... ss or producing articles or things or for the purpose of generation of power and not for trading purposes. The declaration to be made in subsection (1A) of section 206C thus would enable the Revenue authorities to, as and when the need so arises make proper verifications. This subsection itself does not provide for any time limit within which, such declaration is to be made. The time limit, of course, would be found in Rule 37C of Income Tax Rules, 1962. The main thrust of subsection 1A of section 206C thus is to make a declaration as prescribed, upon which, the liability to collect tax at source under subsection (1) would not apply. When there was no dispute about such a declaration being filed in a prescribed format and there was no dispu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ration to the Commissioner of Incometax in time. The assessee on the other hand had contended that he was not a trader of scrap and therefore, the provisions of section 206C did not apply at all. Assessing Officer turned down his contention and proceed to make the additions. 4. Eventually, when the issue reached the Tribunal, the Tribunal relying on earlier decision in case of Bharti Metals held that the items in question were scrap. However, in view of the fact that the assessee had admittedly filed a declaration in form 27C collected from the buyers, ruled in favour of the assessee. The Tribunal observed as under: 9. This leads both the parties aggrieved. The Revenue's case is that the CIT(A) has erred in accepting the assesse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 015 fails. 5. It thus, emerges that admittedly the assessee had submitted form 27C collected from the buyers. There was no dispute about the genuineness of the contents thereof. However, the same was filed somewhat belatedly. It was in this background, the Tribunal found that the additions with the aid of section 206C could not have been made. 6. Section 206C of the Act pertains to profits and gains from the business of trading in alcoholic liquor, forest produce, scrap etc. Subsection 1 of section 206C provides that every person being a seller shall at the time of debiting of the amount payable by the buyer collect from the buyer of any of the goods specified in column (2) of the table, a sum equal to the percentage specified in th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... esponsible for the tax a declaration in writing in prescribed form declaring that the goods in question are to be utilized for the purposes of manufacturing process or producing articles or things or for the purpose of generation of power and not for trading purposes. The declaration to be made in subsection (1A) of section 206C thus would enable the Revenue authorities to, as and when the need so arises make proper verifications. This subsection itself does not provide for any time limit within which, such declaration is to be made. The time limit, of course, would be found in Rule 37C of Income Tax Rules, 1962. The main thrust of subsection 1A of section 206C thus is to make a declaration as prescribed, upon which, the liability to collec ..... X X X X Extracts X X X X X X X X Extracts X X X X
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