Case Law Details
Ambience Developers & Infrastructure Pvt Ltd Vs JCIT (ITAT Delhi)
Introduction: The recent case of Ambience Developers & Infrastructure Pvt Ltd vs. JCIT before the Income Tax Appellate Tribunal (ITAT) Delhi addresses a crucial aspect of penalty imposition under section 272A(2)(k) of the Income Tax Act. The dispute revolves around the delayed filing of TDS returns and the subsequent penalty imposed by the Assessing Officer (AO).
Detailed Analysis: In the appeal for the assessment year 2010-11, the assessee contended that the delays in filing TDS returns were due to financial constraints. The quarterly TDS returns were submitted suo moto after the remittance of TDS with applicable interest, without any notice from the income tax department. The AO, however, upheld the penalty under section 272A(2)(k), a decision affirmed by the Commissioner of Income Tax (Appeals) [CIT(A)].
The ITAT, in its comprehensive analysis, noted that the reasons for the delayed filing were duly explained by the assessee and were not found false by the revenue. The assessee had already incurred interest under section 201(1A) for late remittance, ensuring no loss to the exchequer due to the delayed TDS returns. Emphasizing the nature of a mere technical venial breach, the ITAT ruled against invoking the penalty provision.
The decision draws support from precedent, particularly the case of Haryana Distillery Ltd vs JCIT, reported in 97 taxmann.com 571 on 4.9.2018. The tribunal highlighted that a technical breach, without resulting in any loss to the exchequer, should not warrant the imposition of a penalty.
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