I.T.A. No. 185/KB of 1998-99, decided on 26th July, 1999. Versus I.T.A. No. 185/KB of 1998-99, decided on 26th July, 1999.

ORDER

MUHAMMAD DAUD KHAN (ACCOUNTANT MEMBER).‑‑ In this departmental appeal the department's grievance is regarding C'sIT(A) setting aside for de novo proceedings, the department's order under section 52 treating the assessee to be in default for short deduction of Rs. 84,951 from payments made by it to Messrs Premium Mercantile Services Ltd.

2. Syed Riazuddin, learned D.R. represented the department while Mr. Z.A. Jaffery, Advocate appeared for the assessee respondent.

3. We have perused the DC'sIT order, dated 26‑1‑1999 and C'sIT(A) order, dated 19‑3-1999. The assessee had meticulously deducted tax from payments made by it to its suppliers. in accordance with law but there were short deductions in case of Messrs Premium Mercantitle Services Ltd. and the same was on account of assessee not considering Central Excise Duties for the purpose of deduction under section 50. The DCIT referred to decisions of the Tribunal and instructions of the Board and raised the demand of Rs.84,951 against the assessee under section 52. Assessee's plea before the CIT(A) was that the amount in question had already been paid by Messrs Premium Mercantile Services Ltd. In view of it the DCIT was not justified to treat assessee as in default for this amount because obviously the same amount cannot be collected from two persons. At the most the Assessing Officer could have charged additional tax under the provisions of the section 86 from the dates of default/short deductions to the date of payment by the recipient. Mr. Riazuddin could not convass and valid arguments before us for our decision in the matter to the contrary. We, therefore, feel no hesitation in upholding the C'sIT(A) order. The departmental appeal is dismissed.

C. M. A. /M. A. K./368/Tax (Trib.) Appeal dismissed.