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2023 (8) TMI 1184 - AT - Income TaxPenalty u/s. 271C - order u/s 201(1) - assessee purchased two immovable properties on which no TDS was deducted u/s 194-IA - assessee submitted that the seller of the aforesaid two properties are regularly assessed to tax and they have disclosed income on sale of the aforesaid properties in their return of income and paid taxes - HELD THAT:- There seems to be a bona fide mistake on the part of the assessee in not deducting taxes at source u/s 194-IA - assessee has also furnished relevant documents in support of the fact that the recipients/payees have duly reflected the sale consideration in their respective returns of income have and have also paid taxes thereon. Therefore, it is evident that there is no loss to the Revenue on account of non-reduction of taxes at source by the assessee. Further, it is seen that the assessee has also paid interest u/s 201(1A) of the Act for non-deduction of tax at source in the instant facts. As decided in Bank of Nova Scotia [2016 (1) TMI 583 - SUPREME COURT] held that when the assessee’s conduct is not contumacious, then penalty under Section 271C of the Act is liable to be vacated. Supreme Court of India made the following observation in the Case of M/s Eli Lilly & Company (India) Pvt. Ltd. & Ors. [2009 (3) TMI 33 - SUPREME COURT] with regards to reasonable cause for failure to deposit tax deducted at source held that only those persons will be liable to penalty who do not have good and sufficient reason for not deducting tax and burden, of course, is on such person to prove such good and sufficient reason. Thus as there is a bona fide mistake on part of the assessee in not deducting taxes at source at time of purchase of aforesaid two properties, coupled with the fact that the recipients/sellers have duly accounted for the sale consideration in their respective returns of income and hence, there is no loss to the Revenue, we are of the considered view that this is a fit case for deleting the levy of penalty u/s 271C - Decided in favour of assessee.
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