A.T. Varkey, Judicial Member - This appeal has been filed by the department against the order of the ld CIT(A), XII, New Delhi dated 08.11.2012.
2. The grounds of appeal are as follows:—
"1. |
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The CIT(A) has erred in law and on facts in giving direction to the AO for verification of the e-TDS return and correction statement filed by the assessee, there by setting aside the AO's order instead of deciding it. |
2. |
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The order of the ld CIT(A) deserves to be cancelled and the order of the AO be restored." |
3. Ground Nos. 1 and 2 are against the order of the ld CIT(A) directing the AO to verify the e-TDS return and correction statement filed by the assessee, which according to revenue amounts to setting aside the order of AO, whereas he should have decided it, and therefore the impugned order needs to be cancelled.
4. The facts of the case are that the assessee filed an e-TDS statement in Form No. 24Q, for the 4th Quarter of the Financial Year 2008-09. The AO analyzed the TDS statement on the basis of entries reported by the deductor (assessee) and compared it with the information available as per bank challan details. The analysis revealed defaults i.e. non-payment of TDS amount deducted, the non/ low deduction of TDS at prescribed rates and late payment of taxes as under:—
| Description |
Amount |
Interest u/s 201(1A) |
Total amount of short deduction / collection (As per Annexure of order |
5,36,710/- |
1,23,440/- |
Total amount deducted but not paid (as per Annexure of order |
0 |
0 |
Total interest on late payment (as per Annexure of Order) |
0 |
3,660/- |
Total |
5,36,710/- |
1,23,440/- |
Grant Total (Total Amount +Total Interest) |
6,63,810/- |
|
5. The AO on the basis of justification report held the assessee in default in respect of amounts specified as above. Accordingly the assessee was directed to pay Rs. 6,63,810/- inclusive of interest.
6. Aggrieved by the said order of the AO the assessee preferred an appeal before the ld CIT(A).
7. The ld CIT(A) while adjudicating the appeal, observed that the AO had raised demand u/s 201(1)/201(1A) of the Act at Rs. 6,63,810/- due to mis-match of challans on the OLTAS; and due to the fact that the system showed there was a short payment of TDS by the assessee. In his impugned order the ld CIT(A) has noted that the appellant in fact had furnished the correction statement before the AO, however, the AO did not accept the said correction statement because the appellant's corrections were not accepted by the NSDL. Against the observation of the AO in his order that there was short deduction of tax of 18 persons working with the assessee which amounts to Rs. 5,36,710/- the ld CIT(A) has taken note that the appellant/assessee had in fact furnished copies of 25 challans in support of its contention that there were in fact no short deduction of tax, even though the challan amounts and short deduction amounts could not tally. Taking into consideration note of the fact that the appellant had filed correction statement and had also furnished the copies of challans in support of its contentions before him, the ld CIT(A) directed the AO to verify the appellant's claim and allow credit of the same as per law and the appellant was also asked to place before the AO the relevant documents in respect of its claim in respect to TDS made by it.
8. Aggrieved by the said direction/ order passed by the ld CIT(A) to othe AO, the revenue is before us and the main grievance of the revenue is that the ld CIT(A) should have decided the issue before it rather than directing the AO to verify the claim of assessee which according to its amounts to setting aside the order of the AO and therefore prays that it should be cancelled and the order of the AO restored.
9. We have heard both the sides and have perused the records. We find that the impugned order has been passed by the ld CIT(A), on an appeal preferred by the assessee against the order passed by ITO (TDS) u/s 201 of the Act which is an appealable order before ld CIT(A) u/s 246A(1)(ha) of the Act. In the impugned order the ld CIT(A) has directed the AO to verify the details filed by the assessee in respect to its claim and allow the credit to assessee as per law. In order to see whether the said order/ direction passed by the ld CIT(A) to AO is valid or not, one has to look into the provision of law which gives power to the ld CIT(A) u/s 251 of the Act. For convenience section 251 is reproduced below:—
"251. (1) In disposing of an appeal, the Commissioner (Appeals) shall have the following powers-
(a) in an appeal against an order of assessment, he may confirm, reduce, enhance or annul the assessment.
(c) in any other case, he may pass such orders in the appeal as he thinks fit."
10. A perusal of the above provisions reveals that ld CIT(A) has the following (sic) while disposing of an appeal i.e. as per section 251(1)(a) while deciding an appeal against an assessment order, he may confirm, reduce, enhance or annul the assessment; as per section 251 (1)(aa) while deciding an appeal against an order of assessment, in respect of which the proceeding before the settlement commission abates u/s 245 HA he may confirm, reduce, enhance or annul the assessment; and as per section 251(1)(b) while deciding an appeal against imposition of penalty, he may confirm or cancel such order or vary it so as either to enhance or to reduce the penalty; and as per section 251 (1)(c), while deciding any other appeal which does not fall u/s 251(1)(a), aa, and b, the ld CIT(A) has been empowered by law to pass "such orders as he thinks fit". In the instant case the order appealed before the ld CIT(A) was passed by the AO u/s 201 of the Act and as we have seen that the ld CIT(A) has been empowered by section 251 (1)(c) of the Act to pass such orders as he thinks fit while deciding the such an appeal. In the instant case we note that the ld CIT(A) has observed that the appellant had filed correction statement and furnished relevant documents of TDS to prove its claim before him and he had also taken note of the fact that the AO has not accepted the said document because the appellant's correction statement were not accepted by the NSDL. In the light of the discussion above, we are of the opinion that when the ld CIT(A) adjudicates an appeal preferred against an order passed u/s 201 of the Act, he draws his power from sub-section (1)(c) of section 251 of the Act, which entails him to pass any order as he thinks fit and we do not find any restriction in the said power and we cannot read any restrictions which is not there in sub-section (1)(c) of Section 251 and therefore even he has powers to even set-aside the said order impugned before him. However we find that in the instant case before us, the ld CIT(A) has not set aside the AO's order and the impugned order of the AO which is passed u/s 201/ 201A of the Act, whereas he has remitted the case back to the file of AO to verify documents produced before him which was filed by the assessee to substantiate its claim and to allow the credit as per law. Therefore, we find no infirmity whatsoever in the direction passed by the ld CIT(A) and therefore we find no merit in the said appeal preferred by the revenue, so we uphold the order of the ld CIT(A) and dismiss the appeal of the revenue.
11. In the result the appeal is allowed.