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2024 (1) TMI 410 - AT - Income TaxTDS liability u/s 194N - Payment of amount in Cash to co-operative societies - Amounts paid to PACCS towards Pongal Inam/gift and agrarian loans given by the State Government. - demand raised u/s 201(1) / 201(1A) for default in deduction of tax at source - The funds have been transferred by the assessee to various Co-operative societies who apparently do not fall under the exception clause - HELD THAT:- The assessee and similar other assessees have already approached Hon’ble High Court of Madras in Writ jurisdiction wherein the recovery of demand has been stayed by Hon’ble Court but the final adjudication is pending. As rightly pointed out by Ld. Sr. DR, the latest decision has been rendered by Hon’ble Court in the case of Primary Agricultural Co-operative Credit Societies titled as Erode Mavatta Valaman Thodakka [2023 (8) TMI 42 - MADRAS HIGH COURT] As seen that Hon’ble Court has granted six weeks time to Ministry of Finance, Government of India and the CBDT, New Delhi to decide the request made by the Government of Tamil Nadu through the letter of the Chief Secretary to Government of Tamil Nadu dated 27-9- 2022, seeking exemption for all those Primary Co-operative Credit Societies functioning in the State of Tamil Nadu from the purview of Section 194N of the Income-tax Act and accordingly pass orders thereon and communicate the same to the State of Tamil Nadu. The issue of applicability of Sec. 194N to the PACCS has thus been directed to be considered by the appropriate organs of the Government of India. The bench has been made aware that the same is still pending for disposal. Thus bench is of the considered opinion that the aforesaid disposal by appropriate authorities would have direct bearing on the demand raised against the assessee and the issue of applicability of Sec. 194N to co-operative societies, itself, is under consideration by appropriate authorities. On this fact, the bench deem it fit to set aside the impugned orders passed by learned first appellate authority, in all the appeals, and restore all the appeals back to the file of Ld. CIT(A) keeping all the issues open. CIT(A) shall adjudicate the appeals de-novo in the light of outcome of aforesaid disposal of representation made by Government of Tamil Nadu before appropriate authorities. All these appeals stand disposed-off accordingly.
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