TMI Blog2015 (9) TMI 270X X X X Extracts X X X X X X X X Extracts X X X X ..... ing deduction of TDS as per the provision of Sec. 197A (1A) of the Act and as such, reverse the orders of authorities below and delete the disallowance of interest claimed by the assessee. - Decided in favour of assessee. - ITA No.1277/Kol /2013 - - - Dated:- 7-8-2015 - Shri Mahavir Singh, JJ. For The Appellant : Sri P.K. Sanghai, Advocate For The Respondent : Sri Rajendra Prasad, JCIT-DR ORDER This appeal by the assessee is arising out of Commissioner of Income Tax (Appeals)-XX, Kolkata in appeal No. 198.CIT(A)-XX/Ward35(1)/2010-11/Kol dated 12-02-2013. Assessment was framed by ITO Ward-35(1) Kolkata u/s 143(3) of the Income Tax Act, 1961 (hereinafter referred to as the Act ) vide his order dated 20-12- 2010 for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted as invalid and payment of interest corresponding to this Form 15G should be disallowed to u/s. 40(a)(ia) of the Act. 4. In reply to the show cause notice of AO, the AR of the assessee submitted that all the Forms 15G were duly received by the assessee during the first week of March, 2008 but were misplaced for some reasons and could not be found till the end of year i.e. 31-03-2008 and therefore assessee requested all those parties to submit Form 15G afresh. The unsecured loan providers accepted the request of the assessee and resubmitted the Form 15G after 31st March, 2008, however, AO did not accept the plea of the assessee and disallowed the interest paid to those parties for non submission of Form 15G totaling to ₹ 4,48,861 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fore the Tribunal. 5. Ld. Counsel for the assessee referred to paper book in regard to the copies of Form 15G received from the parties and submitted to I.T. Authorities on 07- 04-2008 which is well within the statutory time-limit given in the Act for submitting Form 15G before the Tax Authority. He further prayed that all the Form 15G had all the requisites details filled in including the assessment year i.e. 2008-09 for which the Form 15G have been submitted. Further, Ld. Counsel for the assessee also brought my attention to the assessee s paper book having the copies of misplaced Form-15G which were dated 01-03-2008 and which he again got re-signed from those parties on 04-04-2008. Ld. Counsel urged for relief on this ground that as F ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... able to pay penalty of ₹ 100/- for every day during which the failure continues. Such penalty can be imposed only by the Commissioner or Chief Commissioner of Inc Tax as stated in clause (b) of sub-section 3 of Sec. 272A in sub-section 3 of Sec. 272A of the Act and in sub-section 4 requires that an opportunity shall be given to the assessee before any penalty order is passed. 7. In the present case, the claim of the assessee is that at the time of paying the interest to the parties as mentioned in the assessment order he had before him the appropriate declaration Form 15G received from the payees stating that no tax was payable in respect of their total income and therefore tax need not be deducted from interest u/s 194A and in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r i.e. 2008-09, amount of sum paid and duly signed. 8. The sub-section 1A of Sec. 197A of the Act merely requires a declaration to be filed by the payee of the interest and once it is filed the payer of the interest has no choice except to desist from deducting income tax at source from interest. The sub-section uses the word shall which leaves no choice to the assessee in the matter. This issue is squarely covered in favour of assessee and against the Revenue by the decision of Mumbai Bench F Bench in the case of Vipin P. Mehta v. ITO in ITA No.3317/Mum/2010 dated 20-05-2011 and which has given following finding as under:- We have already seen that under sub-section (4) of Section 272A no penalty can be imposed unless t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 15G well in the stipulated time-limit along with all the relevant details and disallowance u/s 40(a)(ia) of the Act cannot be made only for topographical error in filling the verification date in duplicate Form 15G filled up by payees. All the original Form 15G were received by the assessee before the end of FY 2007-08 and those have been submitted to the Department before 07-04-2008 and assessee was correct in not making deduction of TDS as per the provision of Sec. 197A (1A) of the Act and as such, I reverse the orders of authorities below and delete the disallowance of interest claimed by the assessee. This issue of assessee s appeal is allowed. 9. In the result, appeal filed by assessee is allowed. Order pronounced in open cou ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
