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2019 (2) TMI 428 - ALLAHABAD HIGH COURTImposition of penalty u/s 34(8) of the U.P. Vat Act 2008 - delay in deposit of TDS - no deliberate act in defiance of law or contaminous conduct - government department - Held that:- The imposition of penalty under Section 34(8) is in addition to and unaffected by the payment of interest under Section 34(8) - Though the existence of mens rea or dishonest intent is not a prerequisite for imposition of penalty under Section 34(8) as is evident from a bare reading of the said provision and it is a civil liability, if there are bonafide reasons and mitigating factors which explain the delayed deposit of TDS they should be taken into account while taking a decision to impose or not to impose penalty or to determine its extent. Failure to make deduction would however stand on a different footing. In the present case the delay in deposit of TDS for April, May, July, August and October, 2008 ranges from 24 days to 94 days. The Railways should have been conscious of its statutory obligations - Considering the fact that it is not a case of failure to make deduction but of failure to deposit TDS timely and also considering the fact that the matter relates to a Government department, in the facts of the case, the penalty is reduced from ₹ 3,08,296.40/- to ₹ 1541248 i.e. 05% of the TDS. This will act as a deterrent for the future. Tax revision is disposed off.
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