ITAT imposes Cost of Rs. 5,000 for Non-Compliance of Notice received through Income Tax Business

The Cuttack bench of the Income Tax Appellate Tribunal (ITAT) has imposed a cost of Rs. 5,000 on the assessee for non-compliance of the notice received through the Income Tax Business Application (ITBA).

The assessee, Subhag Projects Private Ltd has approached the Tribunal contending that the appeal of the assessee before the ld. CIT(A) was dismissed on account of non-prosecution. It was the submission that on account of Covid period, the assessee was unable to represent its matter properly before the ld. CIT(A). It was the prayer that the assessee may be granted another opportunity to represent its case before the ld. CIT(A).

It was contented on behalf of the department that if an opportunity is going to be granted to the assessee to represent his matter again before the ld. CIT(A) cost should be levied. It was the submission that the substantial time of the revenue is wasted on account of non-compliance.

A perusal of the order of the ld. CIT(A) shows that four opportunities have been granted to the assessee by issuing notices through ITBA System via e-Mail. It was submitted by the ld. AR that notices have been received but the assessee was unable to correspond with its counsel. This being so, we are of the opinion that the assessee should be granted another opportunity of being heard before the ld. CIT(A). This is however, subject to the levy of cost of Rs.5000/- (Rupees Five Thousand Only) payable under the head “Others” by the assessee before the AO and challan of the same be submitted to the ld.CIT(A). Thus, the issues in the appeal of the assessee are restored to the file of CIT(A) for readjudication after granting adequate opportunity of the assessee.

Contract for Removal of Legacy Waste dumped through bio-mining process is Pure Service AAR allowsGST

The Chennai Authority for Advance Ruling ( AAR ) has held that the contract for the removal of legacy waste dumped through the bio-mining process is “Pure Service”.

The applicant, Srinivas Waste Management Services Private Limited is engaged Bio-Waste Management Sector and does all types of waste management like collection and transportation, manpower supply, bio mining, micro composting centre and Bio CNG gas.

The applicant has been awarded the work of removal of legacy waste through biomining process to reclaim the existing dump yard, revamping of dumpsite through biomining to recover land, maintaining the micro compost centres and processing wet waste, labour contract for collection and removing wet waste and bulk waste. TDS was to be collected and paid by the Municipalities and Corporations being recipients of service, if applicable and the applicant is not the person who has to collect and pay TDS.

The Tribunal comprising that the contracts received from various city corporations and municipalities towards the removal of legacy waste dumped at dump sites through the bio-mining process are “Pure services’ rendered to local authority and the activity was a function entrusted to a municipality under Article 243W of the Constitution.

Shri T G Venkatesh, I.R.S., Additional Commissioner and Smt. K Latha Joint Commissioner (ST) observed that the contracts are eligible for exemption from GST vide Sl. No.3 of Notification 12/2017-CT. (Rate) dated 28.06.2017. Further, the contract about Bio-CNG carried at the Central Asphaltic plant being a supply of goods and services together does not qualify as ‘Pure services’ and is not eligible for exemption under Sl. No.3 of Notification 12/2017-CT.

Income Tax Dept shall not Deny TDS Credit to Assessee once It is Deducted by Employer/Deductor

The Income Tax Appellate Tribunal (ITAT), Surat bench comprising Shri Pawan Singh, JM & Dr. A.L.Saini, AM has allowed a claim of TDS credit to the assessee by observing that the same cannot be rejected if the deduction is already done by the employer/deductor and the income tax department can recover the same from them any time.

The assessee, Ms. Liladevi Dokania approached the Tribunal claiming that the Tenant, while paying the rent to assessee had deducted TDS from the payment, but did not deposit in the Government account. The assessee had claimed the whole of the amount of TDS as credited against the tax payable. However, since the deductor (tenant), did not deposit the TDS amount to the credit of the Government account, therefore it was not reflected in the Form 26AS of the assessee and therefore, the AO rejected the claim for TDS credit.

While granting relief to the assessee, the Tribunal observed that “the assessee received the rent income, and the Tenant (Deductor) has deducted TDS but has not deposited the TDS so deducted into the Central Government Account. Considering these facts, we note that issue under consideration is no longer res integra. The Hon`ble High Court of Gujarat in the case of Kartik Vijaysinh Sonavane, [2021] 132 taxmann.com 293 (Gujarat) held that where TDS has been deducted by employer of assessee, it will always been open for department to recover same from said employer and credit of same could not have been denied to assessee.”

Allowing the appeal, citing the High Court decision, the Tribunal observed that “Therefore, respectfully following the judgment of Hon`ble High Court of Gujarat in the case of Kartik Vijaysinh Sonavane (supra), we direct the Assessing Officer to verify the claim of the assessee and allow credit of TDS in accordance with law.”