Home Case Index All Cases Income Tax Income Tax + HC Income Tax - 2013 (9) TMI HC This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2013 (9) TMI 766 - HC - Income TaxAssessee in default u/s 201 for not deducting tax at source – TDS u/s 192 on conveyance allowance to employees - assessee was under bonafide belief that the conveyance allowance was exempt u/s 10 (14) – Held that:- If the tax has not been properly deducted or has not been properly paid after deducting, the person who is responsible is to be deemed to be an assessee in default in respect of the tax - Employer had to deduct tax from the salary paid to its employees on the basis of the estimated income of such employees - So long as the estimate made by the employer is bonafide, it cannot be faulted for not deducting tax – If it is found that the estimate made by the employer was malafide then, the provisions of section 201 can be rightly applied. In the present case, upto January, 1993 the assessee had been deducting tax at source on conveyance allowance paid to its staff. Thereafter on meeting held by the representatives of the assessee company with the Income-tax Officer (TDS), from which the assessee inferred that the conveyance allowance paid to its workmen was not to be included for calculating their taxable salaries. Consequently, the assessee obtained declarations from its employees that the amount received by the staff was actually spent on coming to office from residence and vice-versa, which were furnished to the revenue authorities during the course of proceedings - Inference can be drawn that advice came from the Income tax officer(TDS) from the letter written by the assessee-company to the said Income-tax Officer on 29th January, 1993 – Thus, action of the assessee, in not deducting tax at source from conveyance allowance paid to its workmen, was based on bonafide belief – Decided in favor of Assessee.
|