Vaayu Infrastructure LLP Vs DCIT (ITAT Mumbai)
Summary: The Mumbai ITAT allowed Vaayu Infrastructure LLP’s appeal for AY 2018-19 for statistical purposes and directed factual verification of TDS payments underlying an aggregate demand of Rs.6,67,258. The AO had treated the assessee as in default under Section 201(1) for Rs.3,51,134 of TDS stated to have been deducted but not deposited and Rs.3,123 allegedly not deducted on Renewable Energy Certificate (REC) registration charges of Rs.31,231, besides levying interest under Section 201(1A). The assessee produced challans claiming that the deducted tax had subsequently been deposited. The ITAT held that once deducted tax is deposited into the Government Treasury, the same amount cannot continue as principal liability under Section 201(1); however, interest under Section 201(1A) survives for the period of statutory default and must be recomputed up to the actual date of deposit. The jurisdictional TDS AO was therefore directed to verify each challan against the corresponding payment, deductee, applicable TDS section, amount and financial year and give credit for established remittances. The discrepancy concerning Talati & Talati was also remitted for verification from primary records. Regarding REC registration charges of Rs.31,231, the Tribunal did not finally hold them outside TDS; it restored the issue for verification of the nature of payment, recipient and supporting documents. If found to be statutory or registration fees not liable to TDS, the Rs.3,123 demand and Rs.2,248 interest must be deleted.
