Case Law Details
Santur Infrastructure Pvt. Ltd. Vs ACIT (ITAT Delhi)
We are of the considered view that firstly, the assessee was not required to deduct TDS as the payment of EDC was not made out of any statutory and contractual liability to HUDA with whom the assessee has no privity of contract; secondly, the assessee has reasonable cause for non-deduction of tax at source by the assessee company; thirdly it is not the case of the Revenue authorities that the assessee has intentionally avoided the deduction of TDS by bringing on record contumacious conduct of the assessee; and fourthly, with continuous clarifications by the CBDT and DTCP discussed in the preceding paras, the issue became debatable if the TDS is to be deducted or not on the EDC providing reasonable cause to the assessee not to deduct the TDS. Consequently, penalty levied by the AO and confirmed by the ld. CIT (A) is not sustainable in the eyes of law, hence ordered to be deleted.
FULL TEXT OF THE ITAT JUDGEMENT
Appellant, M/s. Santur Infrastructure Pvt. Limited (hereinafter referred to as ‘the assessee’) by filing the present appeal sought to set aside the impugned order dated 19.06.2019 passed by Commissioner of Income-tax (Appeals) – 31, New Delhi affirming the penalty order dated 11.01.2018 passed u/s 271(1)(c) of the Income-tax Act, 1961 (for short ‘the Act’), qua the assessment year 2015-16 on the grounds inter alia that :-
“1. Under the facts and circumstances of the case, the penalty order dt. 11.01.2018 passed u/s 271C of the Income Tax Act,1961 by the ld. Assessing Authority and upheld by the Ld. First Appellate Authority is void as it is barred by limitation as prescribed u/s 275(1)(c) of the Act and the same deserves to be quashed.
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