9911796707
TMI Blog1987 (11) TMI 117X X X X Extracts X X X X X X X X Extracts X X X X ..... Nopany Sons Rs. 2,42,432.00 12. Nopany Sons Rs. 1,79,594.00 13. Ajanta Tubes Ltd. (2363.00 + 2418.75) Rs. 4,781.75 . Rs. 9,33,629.75 2. The facts in brief are that the assessee submitted its return disclosing nil income filed on 11th Aug., 1980, along with an application for making a provisional assessment under s. 141A of the IT Act, 1961 (in short, the Act). In pursuance of the assessee's application, a provisional assessment was made under s. 141A of the Act which resulted in a refund of Rs. 9,72,580, which was inclusive of the aforesaid sum of Rs. 9,33,630 claimed on the basis of the tax deducted at source (in short, the TDS) certificates furnished in respect of the aforesaid 13 parties. Subsequently the ITO withdraw the credit allowed of the said sum of Rs. 9,33,630 in computing the tax as per his order under s. 143(3) dt. 6th Feb., 1985 on the ground that in the TDS certificates furnished in respect of the said sum, the dates for deposit of the sums deducted were not furnished. The CIT(A), however, observed that though in the TDS certificates issued by the aforesaid 13 parties they deducted the tax at so ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in holding that the intention of the so-called tax deduction at source is only to enable a sister concern wrongfully to get refund from the Government. 7. That the CIT(A) was wrong in holding that the tax deduction certificates is a mere scrape of paper. 8. That the CIT(A) was wrong that the payers do not have intention of paying tax deduction at source to the Government. 9. That the CIT(A) was wrong in confirming the action of the ITO in not allowing the credit for tax deducted at source on the basis of irrelevant consideration and using irrelevant material for the purpose. 10. That the CIT(A) failed to appreciate that the appellant was not responsible for failure on the part of the payer to deposit it in the Government A/c. 11. That on the facts and in the circumstances of the appellants case and applying the provision of law correctly there was no case for not allowing the credit for the entire amount of the tax deducted at source." A paper book has been submitted before us which contains the list including the names of shareholders as also the directors of the assessee-company and the details of the TDS certificates furnished before the lower authorities. No ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ceived and cannot be extended to an amount which the Government has not received". It has been stated that the factum of non-payment of the taxes to the Central Government being not in dispute the assessee cannot claim credit of the tax stated to have been deducted by the 13 parties mentioned in the ITO's order. 4. In order to understand the issue in its proper perspective it is necessary to dwell on some other facts mentioned by the ITO, namely, that the assessee paid during the relevant accounting year interest aggregating to Rs. 6,23,784 to certain parties other than the banking institutions, viz., M/s. Bilaspur Spg., Mills Indus. Ltd., Ajanta Services Pvt., Ltd., Nopany Sons (P) Ltd., Smt. Mohini Devi Kedia, Master Abhisekh Kedis and Nopany Industries (P) Ltd. The ITO found that the assessee did not deduct tax at sources under s. 194A amounting to Rs. 1,34,107. The ITO by invoking the provisions of s. 201(1A) levied interest of Rs. 80,460 for the default committed by the assessee in not deducting the tax at source on payment of interest made to the aforesaid parties. The ITO, however, did not demand the tax in default, i.e., Rs. 1,34,107. The CIT(A) deleted the intere ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ctually paid in cash. That means that a party or an assessee must have paid some amount of duty whatever may be the quantum. If this literal interpretation is placed on the expression "paid" in r. 10 it is needless to state that it will support in a large measure the contention of Dr. Syed Mohammad that r. 10 contemplates a short-levy in the sense that the amount which falls short of the correct amount has been assessed and actually paid. In our opinion, the expression "paid" should not be read in a vacuum and it will not be right to construe the said word literally, which means actually paid. That word will have to be understood and interpreted in the context in which it appears in order to discover its appropriate meaning." Now we have to understand in what context the word 'paid' has been used in s. 199. The said section reads as follows: "Any deduction made in accordance with the provisions of ss. 192 to 194 s. 194A, s. 194B, s. 194BB, s. 194C, s. 194D and s. 195 and paid to the Central Government shall be treated as a payment of (tax) on behalf of the person from whose income the deduction was made, or of the owner of the security or of the shareholders, as the case may ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tries Ltd., have been signed by the Accountant who is not a person responsible for deducting tax in term of s. 204 of the Act. In our opinion, the word 'paid' appearing in s. 199 means payment in the literal sense as other-wise the words 'credit for tax deducted' would not have figured in the marginal note. The word 'credit' as per dictionary meaning means 'acknowledgement' which in turn implies that the amount paid to the central Government shall be treated a payment of tax and necessary credit of the said amount shall be given on production of the certificate furnished in terms of s. 203. Sec. 203 requires that a certificate for tax deducted at source has to be issued by the person deducting tax in terms of s. 194A. Form 19A which has been prescribed for the purpose requires for furnishing of the date of deposit of the tax to the Central Government. In the certificates furnished in respect of M/s. Nopany Investment (P) Ltd., M/s. Ramacast Limited, M/s. Shrre Annapuran Financing Co., Pvt., Ltd., M/s. Nopany Sons, M/s. Acme Papers Ltd., M/s. Andhra Cotton Mills Ltd., M/s. Nopany Sons and M/s. Nopany Sons though dates have been mentioned for payment of tax to the credit of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ngly, uphold the CIT(A)'s order in this regard. 5. Grounds 12 and 13 pertain to the CIT(A)'s order restricting the ITO's disallowance out of travelling expenses and motor car expenses at Rs. 15,665 and Rs. 4,000 respectively. The ITO made the disallowance out of travelling expenses with reference to r. 6D the particulars of which have been furnished before us. It is found that the dates of the actual travelling and the period of stay of the employees have not been furnished in the details. Before us, the learned counsel furnished a comparative chart showing the disallowances made in the earlier years under this head. The said chart so furnished reveals that out of the total expenditure of Rs. 67,947, only Rs. 5,000 has been disallowed on estimate in the asst. yr. 1979-80. The ITO's computation of the disallowance under r. 6D has not been furnished before us. In our opinion, the disallowance in the assessment year under appeal appears to be excessive as the total amount claimed under the head 'travelling' is Rs. 36,674. Considering the past disallowances made under this head we restrict the addition to Rs. 5,000. 6. In regard to the disallowances out of car expenses of Rs. 4,0 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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