[1] Court No. - 27 Case :- INCOME TAX APPEAL No. - 10 of 2003 Petitioner :- M/S U.P. Rajkiya Nirman Nigam Ltd. Respondent :- Income Tax Appellate Tribunal, Lucknow Bench & 2 Ors. Petitioner Counsel :- J.N. Mathur Respondent Counsel :- Pradeep Agarwal Hon'ble Devi Prasad Singh,J.
Hon’ble S.C. Chaurasia,J.
1. Heard Sri Mudit Agarwal, holding brief of Sri J.N. Mathur,
learned counsel for the appellant, and Sri Ghanshyam
Chaudhary, holding brief of Sri D.D. Chopra learned counsel
for the respondents.
2. Present appeal under Section 260A of Income Tax Act, 1961 (In
short the Act), has been preferred with regard to penalty
imposed for an amount of Rs.4,84,610.00 by the Assessing
Officer under Section 272A (2) (g) of the Act for the
Assessment Year 1999-2000.
3. The assessee Corporation was engaged in construction work of
Government building during the assessment year in question.
The assessee Corporation made payments to contractors against
the work done by them. In view of the provisions under Section
194C/203 of the Act read with Sub-rule (3) of Rule 31 of
Income Tax Rules, 1962 (In short the Rules), the assessee
Corporation was required to issue TDS certificates in respect of
the TDS deducted. The TDS certificates were to be issued to the
contractors within one month from the end of the month during
which the credit was given or the payment was made. On the
verification of the return of the assessee Corporation for the
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Financial Year 1988-89, it was found that the TDS certificates
were not issued within prescribed time. There were 41
contractors to whom said certificates were issued at belated
stage. On account of non-compliance of provisions contained
under Section 194C/203 of the Act read with Rule 31 (3) of
Income Tax Act Rules, the Deputy CIT, Income Tax TDS
Circle, Kanpur, made reference to the Joint Commissioner of
Income Tax Range-4 for initiating proceeding for imposition of
penalty under Section 272A (2) (g) of the Act, by an order dated
22.6.2000. In consequence thereof, the Joint CIT issued show
cause notice to the assessee requiring it to explain why penalty
under Section 272A (2) (g) of the Act for an amount of
Rs.6,29,500.00 may not be imposed .
4. The assessee Corporation took a plea that the assessee was not
aware with regard to delayed deduction of TDS. The assessee
took the plea that he was not aware of the relevant legal
provisions relating to issuance of TDS certificate. The
alternative plea was that the contractors requested for
consolidated form No.16-A and, therefore, consolidated
certificates issued according to provisions of Rule 31 of the
Rules. The Joint Commissioner after providing due opportunity,
found that the delay caused occasioned to impose penalty. It
was noticed by the Joint Commissioner that the TDS
certificates were not only signed late but the same were not
furnished and were kept by the assessee Corporation. According
to the Joint Commissioner, in 21 cases, the certificates were not
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despatched even until 9.1.2001 when the assessee was heard
during the course of penalty proceeding. In view of these facts,
the Joint Commissioner recorded finding that the assessee has
acted in total disregard of legal provisions relating to furnishing
of TDS certificates. Accordingly, penalty was imposed. Being
aggrieved, the appeal was preferred before the CIT. (Appeal).
5. The appellate authority upheld the order passed by the assessing
authority. An appeal was preferred before the Tribunal against
the order of the appellate authority and the Tribunal upheld the
order of the CIT (A). The concurrent finding have been
recorded by all the three forums. It has been observed that there
has been serious misconduct and slackness on the part of the
Officers concerned. They have not only shown disregard to
statutory provisions and statutory obligations but also they have
acted unfairly while discharging their obligations. The finding
of fact recorded by the Tribunal shows that there is collusive act
on the part of the parties in not discharging their obligation with
regard to statutory provisions.
6. Though, appeal was admitted by this Court on substantial
questions of law framed at serial No.A and B but while
admitting the appeal, the Court itself has not framed any
question of law which is mandatory in view of the provisions
contained in Section 260A of the Act.
7. However, it has been stated that in case, the delay caused is
bona fide, then no penalty could have been imposed under
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Section 272-A (2) (g) of the Act. Of course, a bona fide action
in ordinary course, does not call for imposition of penalty under
the statutory provisions. The questions of law framed by the
appellant, could have been helpful in case a finding of fact
would have been recorded with regard to bona fide action on
the part of the appellant. In absence of finding with regard to
bona fide and the involvement of serious misconduct or
collusive act, the imposition of penalty by the Assessing
Officer, suffers from no infirmity or illegality. The defence
taken by the appellant that they were not aware of statutory
provisions, does not seem to inspire confidence. The assessee
appellant which is a Corporation, constituted under the statutory
provisions, is not expected to act like rustic or illiterate persons,
who have no knowledge of statutory duties. Otherwise also, in
ordinary course, the ignorance of law, is not an excuse. Being a
Corporation, which has a battery of lawyers for assistance and
skilled persons, it is always expected that it shall discharge its
obligations within time framed provided by the acts or statutes.
8. Moreover, there is one another aspect of the matter. Once, the
finding of fact has been recorded that the action of the appellant
or its authorities was collusive or suffers from serious slackness
in discharge of duties and statutory obligation or deliberate
attempt on their part to conceal material facts, then such finding
of fact is not open to review or re-appreciation of evidence by
this Court in pursuance of powers conferred by Section 260-A
of the Act. It is not open for this Court to re-appreciate the
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evidence or the finding of fact recorded by the Tribunal or
appellate authorities below while exercising jurisdiction
conferred by Section 260-A of the Act. The substantial
questions of law framed by the Court itself, may be looked into
by exercising power concerned by Section 260-A of the Act.
9. In view of the above, the appeal lacks merit and is accordingly,
dismissed.
Order Date :- 2.2.2010
Rajneesh)