TMI Blog2014 (2) TMI 800X X X X Extracts X X X X X X X X Extracts X X X X ..... r Section 273B – thus, the imposition of penalty which was deleted by the CIT(A) has been affirmed by the Tribunal – there is no substantial question of law arises for adjudication – Decided against Revenue. - Income Tax Appeal No. - 39 of 2014 - - - Dated:- 13-2-2014 - Hon'ble Dr. Dhananjaya Yeshwant Chandrachud, CJ And Hon'ble Dilip Gupta,JJ. For the Appellant : Dhananjay Awasthi ORDER This appeal by the revenue is from a judgment of the Income Tax Appellate Tribunal dated 8 August 2013 insofar as the Tribunal has confirmed the deletion of a penalty that was imposed under Section 271C of the Income Tax Act, 1961 (hereinafter referred to as the 'Act') on the ground that reasonable cause had been shown by the assessee within ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... chers and SIM cards. The CIT(A) held that there was a decision of the ITAT in Idea Cellular Ltd. Vs. DCIT1 in which it was held that the payment made to Primary Market Agents (PMA) was not a commission or brokerage and was not liable to TDS and even if the liability to pay TDS was fixed on the assessee, the imposition of penalty was not warranted. The CIT(A) also relied upon a communication dated 13 December 2007 of the corporate office of the assessee. In deleting the penalty, the CIT(A) adverted to the judgment of the Supreme Court in the case of Hindustan Steel Ltd. Vs. State of Orissa2 which lays down a well settled principle that a penalty will not be imposed merely because it is lawful to do so and the imposition of the penalty lies i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uct tax at source is beyond dispute. The only issue is as to whether reasonable cause for a failure to deduct tax at source under Section 194H had been shown. The CIT(A) has exercised his discretion particularly having regard to the fact that at the relevant time, there was a decision in Idea Cellular Ltd. (supra) and in view whereof the assessee was under a bona fide belief that tax was not liable to be deducted on commission/trade discount. This is, at least, a possible view to take and which has been sustained by the Tribunal. In fact, it must be emphasised that the Tribunal has not laid down the proposition that ignorance of law can furnish an excuse for non-deduction of tax at source and the learned counsel is right in saying that this ..... X X X X Extracts X X X X X X X X Extracts X X X X
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