ITAT Deletes section 271C Penalty for Failure to Deduct TDS on LTA

Canara Bank (Erstwhile Syndicate Bank) Vs ACIT (ITAT Bangalore) The issue under consideration is whether the penalty u/s 271C levied due to failure to deduct tax at source (TDS) on LTA paid to employee is justified in law? ITAT states that, the assessee bank has undertaken reasonable steps in terms of verifying the assessee’s claim towards their LFC claims and is aware of employees travelling to foreign countries as part of their travel itinerary but at the same time, there is an error of judgment on part of the assessee bank in understanding and applying the provisions of section 10(5) ...