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2018 (3) TMI 735 - AT - Income TaxPenalty u/s 271C - Short deduction of tax at source in respect of Brand fee paid - TDS u/s 194J or u/s 194C - Held that:- With regard to the belief of the assessee that the payment was in the nature of contract payment the agreement clearly indicated that the payment was brand fee and the assessee had not entered in to any contract for rendering the services but manufactured the goods on it’s own in the brand name of parent company and sold the same to APBCL. For using the Brand name the assessee had made the payment of Royalty which clearly indicated by the agreement and discussed in detail by the CIT(A). Therefore this argument of the assessee is not tenable. The argument of the assessee that short deduction does not cause loss to the revenue is not a reasonable explanation and it shows the willful default of the assessee for short deduction In the instant case the assessee could not establish with the tangible evidence to show that there was reasonable cause for short deduction of tax. Therefore we are of the considered view that the assessee has failed to explain the reasons for short deduction of tax at source, hence, we up hold the order of the Ld. CIT(A) - Decided against assessee.
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