Case Law Details
Yes Bank Ltd. Vs Add. CIT (TDS) (ITAT Dehradun)
ITAT Dehradun held that Uttarakhand Environment Protection and Pollution Control Board (UEPPCB) is a corporation which has been constituted under a Central Act, no tax was deductible. Accordingly, penalty u/s 271C of the Income Tax Act cannot be levied on a non-taxable entity.
Facts-
The TDS officer observed that Uttarakhand Environment Protection and Pollution Control Board (UEPPCB) had maintained fixed deposits with the Appellant and that the Appellant Bank had not deducted tax at source on the payment of interest on the fixed deposits. The TDS officer passed the order under section 201(1)/ 201(1A) dated 23 January 2015 thereby raising a demand of Rs. 1,86,539/- on the grounds that the bank had not deducted tax at source under section 194A of the Act, on payment of interest on fixed deposits, to UEPPCB.
A penalty notice dated 5 February 2015 was issued under section 274 r.w.s 271C of the Income Tax Act, 1961 asking the bank to show cause as to why an order imposing penalty should not be passed under section 271C of the Act for the assessment year 2013-14, for the alleged failure to deduct tax at source on payment of interest on Fixed Deposit Receipts to UEPPCB.
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