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2021 (6) TMI 126 - AT - Income TaxRectification u/s 154 - late deposit of TDS deducted under section 194C and 194J - interest under section 201(1A) - Whether the date of deposit of TDS amount through cheque is, the date of tendering cheque or the date of realization of cheque? - HELD THAT:- CIT(A) has relied on the decisions of Tribunal in the case of ICICI Bank Ltd.[2013 (4) TMI 964 - ITAT LUCKNOW], and GM, MPRRDA, PIU, Shivpuri vs. ITO(TDS) [2012 (7) TMI 482 - ITAT, AGRA] to hold that the date of realization of cheque is the date of payment. The CIT(A)’s reliance on the aforesaid decisions to conclude that the issue is debatable is misplaced. We observe that in both aforesaid cases, ostensibly, CBDT Circular No.261 (supra) was not brought to the notice of Bench. Thus, while rendering aforesaid decisions, the Bench was oblivious to Board Circular binding on the Department. CIT(A) in impugned order has only referred to the title (subject) of rectification petition and has not examined the contents of the petition. Para 2 of the petition clearly states the reason for seeking rectification based on CBDT Circular. Therefore, the CIT(A) has erred in not examining the petition of assessee in entirety. We hold that the rectification petition under section 154 of the Act for seeking correction in the date of deposit of TDS amounts was maintainable in its present form. The ground No.1 raised in appeal by the assessee, is thus, allowed. Where the TDS amount has been deposited to the Government Exchequer thorough cheque, whether the date of tendering cheque to the Government’s Banker or the date of realization of the cheque is the date of actual payment - The Hon'ble Supreme Court of India in the case of CIT vs. Ogale Glass Works Ltd., [1954 (4) TMI 3 - SUPREME COURT] held that where the payment is made by cheque, the date of payment would be date of delivery of cheque, provided the cheque is honoured on presentation to the bank. Thus the ‘date of payment’ to Government exchequer through cheque shall be the date of tendering/depositing the cheque, subject to cheque being honoured on presentation. After taking into consideration the facts of instant case and the decisions discussed above, we hold that the TDS deducted under section 194C and 194J of the Act was deposited by the assessee through cheque to the Government’s Banker before the due date. Hence, no interest under section 201(1A) of the Act for alleged delay in deposit of TDS amount is chargeable to the assessee. The interest levied under section 201(1A) of the Act is directed to be deleted. The assessee succeeds on ground no.2 of the appeal.
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