Penalty u/s 271C for Non-Deduction of TDS on Foreign LTC Upheld: ITAT Chandigarh

State Bank of India Local Head Office Chandigarh Vs ACIT (TDS) (ITAT Chandigarh)

ITAT upheld penalty of ₹17.23 lakh u/s 271C levied on the bank for failure to deduct TDS u/s 192 on LTC/LFC reimbursements relating to foreign travel. Tribunal noted that exemption u/s 10(5) applies only to travel within India, and the Hon’ble Supreme Court in the assessee’s own case had already clarified that foreign travel reimbursements are taxable salary.

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