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2017 (10) TMI 526 - AT - Income TaxNon deduct tax at source u/s 194A on the interest on “Flexi Fixed Deposit Schemes” - Proceedings u/s 201(1) and 201(1A)- Held that:- On the perusal of the order of the Assessing Officer as well as the Learned CIT(Appeals), nowhere it is borne out, how the Assessing Officer had satisfied himself as to whether the deductee/payee has failed to pay taxes directly. It is only when a finding is arrived in the case of the deductee/payee that he has failed to pay tax directly, then only deductor, i.e., the present assessee can be deemed to be the assessee-in-default in respect of such tax and then only proceedings u/s 201(1) and 201(1A) can be initiated. Assessing Officer has nowhere given any finding that the deductee/assessee has failed to pay taxes directly and without such finding the Assessing Officer cannot treat the deductor that is, the present assessee as assessee-in-default. The proceedings u/s 201(1)/201(1A) has not been validly initiated and therefore, the impugned order u/s 201(1) read with section 201(1A) is bad in law and same is quashed. In the result the appeal of the assessee is allowed.
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