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2019 (7) TMI 73 - AT - Income TaxLevy of interest u/s. 201(1A) - delayed payment of TDS into Government account - TDS demand was deleted on ground that assessee is not in default within the provisions of section 201(1) as deductees/parties have reflected the receipts in their income - absence of liability for tax - HELD THAT:- Levy of interest u/s. 201(1A) is compensatory measure for withholding the tax which ought to have gone to the exchequer and therefore levy of interest is mandatory and the absence of liability for tax will not dilute the default. As far as the levy of interest u/s. 201(1A) is concerned it is mandatory. What is the period for which the interest is to be calculated? - A proviso has been inserted to the provisions of section 201(1A) by the Finance Act, 2012 w.e.f 01.07.2012 wherein it has been clarified that the interest u/s. 201(1A) shall be payable from the date on which such tax was deductible to the date of the furnishing of return of income by the deductee. This proviso to section 201(1A) of the Act is only clarificatory in nature and would apply retrospectively. In the circumstances, we do not find any infirmity in the order passed by the Ld.CIT(A) in holding that the interest shall be calculated from the date on which tax was first deductible by the deductor to the date of filling of return by the recipient deductee. Thus, we uphold the orders of the Ld.CIT(A) and reject the grounds of the assessee.
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