Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2016 (2) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2016 (2) TMI 195 - AT - Income TaxPenalty u/s 271C - non deduction of tds u/s 194A by the banks including the assessee bank with respect to interest paid to NOIDA - Held that:- In the present case it is apparent that belief of the assessee was reasonable to not to deduct tax at source which is also based upon the notification issued by CBDT u/s 194A(3)(iii)(f) of the Act as well as several judicial precedents. In our view, it cannot be said that Hon‟ble Allahabad High Court has laid down any law with respect to deduction of tax at source on interest payment made by the assessee to Noida. In view of the above facts and circumstances we are of the view that the assessee cannot be subjected to penalty u/s 271C of the Act because there is no failure on part of the assessee to deduct tax at sources u/s 194A of the act in view of the decision of ITAT on this issue for the same years holding that there is no requirement of deduction of tax at source at all u/s 194A of the Act in view of notification dated 22.10.1990. There was a reasonable cause for holding a belief regarding non deduction of tax at source on payment of interest made to Noida which is supported by a notification issued as well as several orders of the coordinate benches holding that interest payment made to Development authorities are exempt for deduction of tax u/s 194A(3)(iii)(f) of the Act. - Decided in favour of assessee
|