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2011 (12) TMI 142 - HC - Income TaxImposition of interest u/s 201(1A) – Imposition of penalty u/s 221 - Assessee in default - assessee under a bona-fide belief not deducted/not paid the tax at source in respect of the reimbursements for expenses to its employees – Held that:- The payment of interest under Section 201(1A) is not penal. Even though default was unintentional, still assessee would be deemed as “assessee in default. There is, therefore, no question of waiver of such interest on the basis that the default was not intentional or on any other basis. The question of ‘good and sufficient reasons’ only arises on consideration of proviso to Section 201(1) which negate the possibility of imposition of penalty under Section 221 if the Assessing Officer is satisfied that the person liable had good and sufficient reasons to not deduct and pay the tax in question. Thus, in view of proviso to Section 201(1) no penalty can be imposed on the assessee under Section 221 . The matter is remanded to to the assessing officer for the limited purpose of computing the exact quantum of default and the interest payable under Section 201(1A) of the said Act. - Decided partly in favor of Revenue.
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