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2014 (9) TMI 756 - HC - Income TaxNon-deduction of TDS u/s 194I – Petitioner contended that, respondent No.2/the Managing Director, Gujarat State Land Development Corporation Ltd. and under the aforesaid heading of ‘rent’, the respondent No.1 has made payment of ₹ 4,87,83,300/- during the years 1998 to 2013 to the Gujarat State Land Development Corporation Ltd. but did not care to deduct tax at source, as provided in Section 194-I of the Income Tax Act, 1961. The petitioner contends that for the above violation of mandatory provision of law, the respondent No.1 has become deemed assessee in default within the meaning of Section 201 of the Income Tax Act but the Income Tax Authority did not take any step in spite of continuous violation of the mandatory provision at the instance of the respondent No.1. Held that:- There has been violation of the provisions contained in Section 194-I of the Act and as a consequence for not deducting tax at source, the Corporation should not only be deemed to be an assessee in default in respect of such tax which has not been deducted but, at the same time, has also made itself liable to pay interest as provided in Section 201(1A) of the Act - the Income Tax Authority in spite of service of notice has not come forward to disclose why it has not taken any step against the Corporation – there was no substance in the contention that in this PIL, the Court should pass an order upon the Income Tax Authority to impose penalty – Income Tax Authority is directed to take immediate step against the Corporation for the non-compliances – Decided in favour of Petitioner.
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