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2013 (11) TMI 619 - HC - Income TaxTDS deduction u/s 194B - Prize money given in kind – Assessee in default u/s 201 - Held that:- it is clear that provisions of Section 194B does not provide for deduction of tax at source where the winnings are wholly in kind and it simply puts a responsibility to ensure payment of tax, where winnings is wholly in kind. In the present case, admittedly, the winnings was wholly in kind. - Decided in favor of assessee. Proceedings u/s 201 - Held that:- the conjoint reading of Section 201 and Section 194B would show that the person responsible to deduct tax at source, if he either fails to deduct or after deducting, fails to pay, is deemed to be an assessee in default, in respect of the tax. However, where the payment of the winnings is wholly in kind and not in cash at all, the question of deduction does not arise and in that eventuality, the only responsibility, as casts under Section 194B, is to ensure that tax is paid by the winner of prize before the prize/winnings is released in his favour. Initiation of the proceedings under Section 201 against the assessee, was without jurisdiction - Section 271C and Section 270B make reference to the second proviso to Section 194-B, i.e., the proviso as it stands today - Proceedings against the person under section 201, such as the assessee in the present case, who fails to ensure payment of tax, as contemplated by proviso to Section 194B, before releasing the winnings, is not maintainable or the proceedings against such person is without jurisdiction – Decided against the Revenue.
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