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2016 (8) TMI 1240 - HC - Income TaxTDS u/s 194A - whether GDA cannot be held to be an "assessee in default" u/s 201(1) - Held that:- In the present case, it is not disputed even by the respondents that whatever tax was due on the amount of interest paid by GDA to PNBHFL and LICHFL, the same was paid by two recipient companies to the Revenue. The final assessment orders in respect thereto were also passed. Income of GDA on its own was not taxable during the relevant period by virtue of section 10(20A) though subsequently it has been omitted. So far as the status of PNBHFL and LICHFL is concerned, there was some genuine doubt regarding their status. Both companies are public limited companies and subsidiaries of the Punjab National Bank and Life Insurance Corporation of India. This caused some doubt whether TDS was deductible or not. However, for the purpose of adjudication of dispute in the present writ petition, we have not given any leverage or advantage to the petitioner for alleged doubt and we have proceeded to decide the matter holding the petitioner defaulter by violating requirement of deduction of TDS under section 194A so as to attract action by the concerned authority under section 201 of the Act, 1961. In view of the above, demand of tax is patently illegal and without jurisdiction. Vires of section 201 challenged - Held that:- When commenced arguments, gave up this plea and stated that he is confining his challenge only to the validity of orders passed by the Income-tax Officer (TDS), impugned in writ petitions, and the same may be considered in the light of relevant provisions of the Act, 1961, and matter be decided accordingly. Hence, we have not looked into vires of section 201 since that plea has been given up. The Income-tax Officer (TDS) is required to find out whether there is any liability of interest on the amount of TDS deductible under section 194A but not deducted and then from the date on which such amount was deductible and the date when actual tax was paid, to compute the amount of interest payable by the petitioner. In this regard, he will have to pass a fresh order
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