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TMI Blog2017 (1) TMI 1039X X X X Extracts X X X X X X X X Extracts X X X X ..... ect the tax at source is liable to be rejected. If the petitioner-Corporation was of the view that the provisions of Section 206C of the Income Tax Act were not applicable to the petitioner-Corporation, the Corporation should not have collected the tax at source at 5%. Admittedly, the petitioner-Corporation had collected the tax at source from the buyers at the auction but the same was collected at a lesser percentage than that is specified in the entry in column (3) of the table. Though the petitioner-Corporation was liable to collect tax at source at 15%, the petitioner-Corporation had collected the same at 5% only and that resulted in the imposition of interest and penalty on the petitioner-Corporation. We do not find any illegality ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . The petitioner challenged the action on the part of the Assistant Commissioner of Income Tax in a revision before the Commissioner of Income Tax under Section 264 of the Income Tax Act. By the impugned order, the Commissioner of Income Tax dismissed the revision filed by the petitioner and upheld the action of the Assistant Commissioner of Income Tax. The order of the Commissioner of Income Tax, Nagpur is challenged by the petitioner in the instant petition. 3. Shri M.V. Samarth, the learned Counsel for the petitioner-Corporation submitted that the provisions of Section 206C of the Income Tax Act could not have been applied to the case of the petitioner as the petitioner-Corporation is not a seller as defined by the provisions of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er-Corporation. It is submitted that the case of the petitioner that the petitioner was a second seller was rightly rejected by the Commissioner of Income Tax by referring to the provisions of Section 206C of the Income Tax Act. It is submitted that the word seller , as defined in the explanation to Section 206C of the Income Tax Act, would not include an individual or a HUF and a tribal individual could not fall within the meaning of the term seller . It is stated that the case of the petitioner that the tribal individual was the first seller was rightly rejected by the Commissioner. It is submitted that the issue involved in the case before the Punjab and Haryana High Court was different and the Commissioner of Income Tax has rightly no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ............. ............. ............. ............. Explanation. For the purposes of this section, ( a) buyer means a person who obtains in any sale, by way of auction, tender or any other mode, goods of the nature specified in the Table in subsection (1) or the right to receive any such goods but does not include (i) a public sector company, (ii) a buyer in the further sale of such goods obtained in pursuance of such sale, or (iii) a buyer where the goods are not obtained by him by way of auction and where the sale price of such goods to be sold by the buyer is fixed by or under any State Act: (c) Seller means the Central Government, a State Government or an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ied in column (2) of the table under Section 206C of the Income Tax Act is the first seller. In view of clause (b) of the explanation a seller means the Central Government, State Government or any local authority, company, firm or cooperative society. The Commissioner of Income Tax has, therefore, rightly held that the petitioner-Corporation could not have claimed that the tribal individual was the first seller, having sold the goods to the petitioner-Corporation and the petitioner-Corporation is the second seller, having sold the goods to the buyers in the auction. If the submission of the petitioner-Corporation is accepted, it would mean that a tribal individual, as a seller , would be required to collect from the petitioner-Corporatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e imposition of interest and penalty on the petitioner-Corporation. We do not find any illegality in the action on the part of the Assistant Commissioner of Income Tax in directing the petitioner-Corporation to pay the interest and penalty on the short fall in the collection of tax at source. The judgment of the Punjab and Haryana High Court in the case of Commissioner of Income Tax v. Virsa Singh and Co. (Supra) and relied on by the Counsel for the petitioner-Corporation cannot be applied to the facts of this case. In the said case the Punjab and Haryana High Court held that the assessee therein being a L-13 Licensee was governed by the proviso to Section 44AC of the Income Tax Act and since the assessee had purchased liquor for human cons ..... X X X X Extracts X X X X X X X X Extracts X X X X
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