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2018 (6) TMI 1095 - AT - Income TaxPenalty 271(l)(c) r.w. Explanation 1A - addition made towards management fees paid u/s 40(a)(ia) for failure to deduct tax u/s 194J - Held that:- mere disallowance of certain expenses during assessment proceedings does not attract penalty provisions u/s 271(1)(c) if such disallowance is made for technical of venial breach of TDS provisions - The Hon’ble Supreme Court in the case of PRICE WATERHOUSE COOPERS (P.) LTD. VERSUS COMMISSIONER OF INCOME-TAX, KOLKATA - I [2012 (9) TMI 775 - SUPREME COURT] held that penalty for concealment cannot be levied in case of bona fide / inadvertent / human error. ITAT, MumbaI Bench “E” in the case of Satyajeet Movies Pvt Ltd (2014 (2) TMI 1335 - ITAT MUMBAI) held that no penalty can be levied u/s 271(1)(c) for any addition made u/s 40(a)(ia) for failure to deduct TDS, once such payment has not been doubted. The default committed by the assessee can be termed it as technical or venial breach for which rigors of penalty provisions cannot be invoked - thus CIT(A), after considering relevant submissions, has rightly deleted penalty levied by the AO in respect of addition made u/s 40(a)(ia) - Decided in favor of assessee.
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