Ajit Lalwani Vs ACIT (TDS) (ITAT Indore)
In the instant of two appeals assessee has challenged the levy of penalty u/s 271CA of the Act for the violation of provisions of section 206C of the Act.
We find that the assessee has furnished copy of form 27BA along with copy of Income Tax return of the parties in these cases where the assessee failed to collect tax at source at the time provided under the Act. It is not in dispute before us that later on the assessee had paid the demand of tax collected at source and interest levied thereon. The assessee is only aggrieved with the penalty levied u/s 271CA of the Act.
With reference to the above proviso in case an assessee files the details in form 27BA certified by Chartered Accountant stating that the buyer or licensee or lessee has furnished the return of income u/s 139 of the Act, after taking into account such amount for computing income in such return of income and has paid the tax due on income declared by him in such return of income and once assessee fulfills this condition it will not be treated as the assessee is in default and thus would be precluded from the levy of penalty u/s 271CA of the Act.
Though in the instant case the assessee has deposited TCS and interest thereon subsequently but even in cases where tax is not collected but the assessee furnishes the form 27BA of the Income Tax Rules, then also assessee is not held liable to have violated the provisions of section 206C.
Examining the facts of the instant case, in light of the above decision we find that the case of the assessee is on a much better footing as tax collected at source is deposited, interest levied thereon have also been deposited and form 27BA of the IT Rules certified by Chartered Accountant containing all the details as required in the proviso to section 206C(6A) of the Act have been fulfilled. We therefore find no justification in the action taken by the Ld. AO of levying penalty u/s 271CA of the Act by treating the assessee in default. Accordingly, the penalty levied at Rs. 15,88,428/- for A.Y. 2011-12 & Rs.2,09,800/- for A.Y. 2015-16 are deleted. Effective grounds raised by the assessee on the issue of levy of penalty u/s 271CA of the Act are allowed.
FULL TEXT OF THE ORDER OF ITAT INDORE
The above captioned appeals filed at the instance of the Assessee for Assessment Years 2011-12 & 2015-16 are directed against the orders of Ld. Commissioner of Income Tax(Appeals)-I (in short ‘Ld. CIT], Indore dated 27.12.2019 & 27.01.2020 which are arising out of the order u/s 271CA of the Income Tax Act 1961(In short the ‘Act’) dated 30.08.2018 framed by ACIT-(TDS), Indore.
The Assessee has raised following grounds of appeal in ITANos. 194/Ind/2020:
