Case Law Details
Eid Mohammad Nizamuddin Vs ITO (ITAT Jaipur)
Conclusion: Delay in filing declarations in Form 27C being a technical breach was thus condoned and the same were being admitted as there was substantial compliance with the requirement of filing the declarations. The matter was set-aside to the file of AO for verification of declarations so filed by assessee in Form 27C and examination of claim of the assessee u/s 206C(IA) afresh in accordance with law.
Held: During the course of survey proceedings, it was found that assessee firm had sold Tendu Leaves to various parties which fell under the category of forest produce and assessee was required to collect tax at source as per the provisions of section 206C(1). AO, relying on the aforesaid survey proceedings and statement of the partner of the assessee’s firm so recorded during the course of survey, observed that assessee firm had failed to collect tax at source from buyers of Tendu leaves and also failed to submit Form No. 27C in the prescribed form to the effect that the goods were to be utilized for the purpose of manufacturing, processing or producing articles or thing and not for trading purposes and accordingly, assessee firm should be considered as an assessee in default for non collection of TCS on sale of Tendu Leaves as the amount received from the buyers were in the nature of trading in Tendu Leaves. It was found that similar declarations had been obtained from the same set of buyers, who were engaged in manufacturing of Beedies from the Tendu leaves so sold by the assessee, in the prescribed format and co-relation between the goods sold and reflected in such certificates having been established, the genuineness of such certificates prima facie didn’t seem to be in dispute. These certificates were vital and essential for the consideration of the subject matter of appeal as these certificates support the contention of the assessee that Tendu leaves had been sold to the manufacturers of Beedies and the case of the assessee fell under section 206C(1A) and not under section 206C(1). At the same time, given that these certificates had been filed for the first time during the present proceedings, in the interest of justice and fair play, these certificates needs to be verified by AO and where on such verification, AO was satisfied about the genuineness of such certificates, necessary relief u/s 206C(IA) could be granted and bestowed on the assessee firm. In the present case there was no culpable negligence or malafide on the part of assessee in not obtaining these declarations and assessee could not be penalized where all along it acted diligently based on advice of his Counsel and subsequently, when the Revenue made it aware of its obligation to obtain such declarations, it made necessary efforts and finally got these declarations. As held by the Courts, where substantial justice and technical considerations are pitted against each other, the cause of substantial justice deserves to be preferred for the other side cannot claim to have vested right in injustice being done because of a non-deliberate delay. The delay in filing such declarations being a technical breach was thus condoned and the same were being admitted as there was substantial compliance with the requirement of filing the declarations. The matter was set-aside to the file of AO for verification of declarations so filed by the assessee in Form 27C and examination of claim of the assessee u/s 206C(IA) afresh in accordance with law.
FULL TEXT OF THE ITAT JUDGEMENT
These are cross appeals filed by the assessee and the Revenue against the respective orders of Id. CIT(A)-3, Jaipur dated 05.03.2018 for A.Y 201314, 2014-15 and 2015-16 respectively. Since the common issues are involved, all these appeals were heard together and are being disposed off by this consolidated order.
Please become a Premium member. If you are already a Premium member, login here to access the full content.
