PSLR Engineers Pvt. Ltd., B-74, Builders Area, Mitra Society, Greater Noida. Vs. ITO,Ward 14 (1), New Delhi.
December, 12th 2013
IN THE INCOME TAX APPELLATE TRIBUNAL
DELHI BENCHES : F : NEW DELHI
BEFORE SHRI G.D. AGRAWAL, HON'BLE VICE PRESIDENT
SHRI A.D. JAIN, JUDICIAL MEMBER
Assessment Year : 2007-08
PSLR Engineers Pvt. Ltd., Vs. ITO,
B-74, Builder's Area, Ward 14 (1),
Mitra Society, New Delhi.
PAN : AADCP2324G
Assessee By : Shri Tapas Ram Misra,
Department By : Ms Y. Kakkar, Sr. DR
PER A.D. JAIN, JUDICIAL MEMBER:
This is Assessee's appeal for Assessment Year 2007-08 against the
order dated 20.07.2010, passed by the CIT (A)-XVII, New Delhi, taking the
"1. That on the facts and in the circumstances of the case, the
impugned ex parte order of the CIT (A) is vague, based on incorrect
appreciation of facts, passed in undue haste without affording
adequate and proper opportunity of hearing, had in law, and void ab
2. That on the facts and in the circumstances of the case, the CIT
(A) erred on facts and in law in confirming the disallowance of
Rs.49,88,608/- on account of alleged failure to deduct tax on the
payment of Rs.48,38,330/- made to sub-contractor and Rs.1,50,278/-
for job work.
2.1 That on the facts and in the circumstances of the case, the CIT
(A) erred on facts and in law in not appreciating that the Assessing
Officer had assumed Rs.48,38,330/- to be the payment made to sub
contractors without TDS without any basis whatsoever.
2.2 That on the facts and in the circumstances of the case, the CIT
(A) erred on facts and in law in not appreciating that the tax audit
report did not record or recommend any disallowance u/s 40 (a) (ia).
2.3 That on the facts and in the circumstances of the case, the CIT
(A) erred on facts and in law in not appreciating that there was nothing
on record that could justify disallowance of Rs.1,50,278 to job workers
and that the Assessing Officer had brought nothing on record to
suggest that any tax was deductible (and not deducted) from the
3. That on the facts and in the circumstances of the case, the CIT
(A) erred on facts and in law in taking into account the grounds of
appeal wrongly filed by the appellant's chartered accountant and not
affording the appellant an opportunity to submit rectified grounds of
4. That on the facts and in the circumstances of the case, the CIT
(A) erred on facts and in law in completely ignoring the written
submission filed by the appellant's representative, even though the
same was reproduced in the impugned order.
5. That on the facts and in the circumstances of the case, the CIT
(A) erred on facts and in law in confronting the appellant with the
grounds as reproduced in the impugned order even though the same
prima facie differed with the appellant's statement of facts and the
reply submitted by the appellant's representative.
6. That on the facts and in the circumstances of the case, the CIT
(A) erred on facts and in law in not accepting the appellant's
contention that the contractee having paid subcontractors directly, the
appellant was not responsible under section 194C of the Act for
deduction of tax."
2. The assessee has filed an application for additional evidence,
contending therein, inter alia, that:
"During the year the Applicant has executed a project for construction
of effluent treatment plant for Meat Products India Ltd., Kerala (a Govt.
of Kerala Undertaking). The said contractee had made direct payments
to the sub-contractors as per advice of their consultants. The
Applicant, not being the person making payment to sub-contractors,
consequently had no liability to deduct tax at source as the same lay
with the contractee who made payments.
The same facts were explained to the Assessing Officer but the
Assessing Officer did not appreciate the facts and circumstances and
made a disallowance of Rs.48,38,330/- under section 40(a)(ia) of the
Act. This sum included Rs.22,98,330/- payable towards purchase of
material on which tax was not required to be deducted. In addition,
some disallowance was made under section 40A (3) of the Act, too.
Against the assessment order the Assessee appealed before CIT
(Appeals). Unfortunately, unknown to the assessee, its Authorised
Representative failed to appear before the CIT (Appeals) on the
appointed date and that caused the CIT (Appeals) to dismiss the
appeal ex-parte without taking into account pertinent facts of the case.
At the time of filing an Appeal before the Hon'ble Tribunal, the
Appellant, acting under advice of its counsel, sought details and
confirmation from the contractee (M/s Meat Products India Limited)
about direct payment to sub-contractors and also invoices and
confirmations for payment made for purchase of materials."
3. The ld. Counsel for the assessee contends that the assessee, in fact,
did not get any effective opportunity before the Ld. CIT (A), since its
authorized representative did not put in appearance before the Ld. CIT (A),
for which reason the Ld. CIT (A) dismissed the assessee's appeal ex parte. It
has been submitted that accordingly, the matter be remitted to the
Assessing Officer for fresh adjudication on taking into consideration the
additional evidence now filed.
4. As opposed to this, the Ld. DR has contended that before the Ld. CIT
(A) the assessee was guided by an auditor and not one, but many
opportunities were provided by the Ld. CIT (A) to the assessee, as is evident
from the impugned order; however, the assessee failed to do the needful
before the Ld. CIT (A); and that therefore, the assessee's appeal needs to be
5. Having considered the matter, we find that the appeal of the assessee
was decided by the Ld. CIT (A) ex parte qua the assessee. This, according to
the assessee's application for additional evidence, happened since the
Authorised Representative of the assessee failed to put in appearance before
the Ld. CIT (A). From this, it is evident that the assessee was not able to avail
proper opportunity before the Ld. CIT (A) to represent the matter. In our
considered opinion, it would be in the fitness of things, since the assessee
has now filed additional evidence before us, that the matter may be remitted
to the Ld. CIT (A) to be decided afresh in accordance with the law on merit,
on affording due and proper opportunity of hearing to the assessee. The
assessee, no doubt, shall cooperate in the proceedings before the Ld. CIT (A).
6. In the result, the appeal of the assessee is treated as allowed for
7. The order pronounced in the open court on 05.12.2013.
[G.D. AGRAWAL] [A.D. JAIN]
VICE PRESIDENT JUDICIAL MEMBER
Dated, 05th December, 2013.
Copy forwarded to:
4. CIT (A)
5. DR, ITAT
AR, ITAT, NEW DELHI.