TMI Blog2015 (10) TMI 2108X X X X Extracts X X X X X X X X Extracts X X X X ..... nation was not called for or was not considered in detail. From the narration of the assessee's explanation as given above, as find that most of the expenses like lorry hire charges, truck operating expenses, business promotion expenses, postage expenses etc. are not subject to TDS provisions. As regards the other payments, the assessee's explanation that it bona-fidely believed that the TDS provisions are not applicable to the assessee seems to be reasonable. In view of the same, find no reason to interfere with the order of the CIT(A) on this issue, particularly, as also there is no loss to the Revenue, as observed by the CIT(A) since the assessee has remitted the TDS from its own sources and the payees have also not claimed the credit fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erefore, the assessee was treated as an assessee in default under S.201(1) and demand was raised both towards TDS amount under S.201(1) and interest under S.201(1A) of the Act. The assessee accepted the demand raised by the Assessing Officer under S.201(1) and 201(1A) and remitted the amounts as per the demands raised. 4. Thereafter, the Assessing Officer initiated penalty proceedings under S.271C of the Act for failure to deduct TDS. In reply to the notice under S.271C of the Act, the assessee submitted that the assessee bona-fidely believed that the TDS provisions were not applicable to the payments made by the assessee, as enumerated in the orders under S.201(1) of the Act. Further, it was submitted that under S.194C of the Act, only ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... also not issued any TDS certificates to t e deductees, who also did not claim the credit for the TDS, as the time for the filing of return in their cases was already over. She observed that the TDS remittances made by the assessee lie with the Department, as the deductees could not claim credit for the same, and therefore, there is no loss to the Revenue. She further observed that in most of the cases, as submitted by the assessee, there was no liability of TDS at all. She accordingly, deleted the penalty levied by the Assessing Officer under S.271C of the Act, for all the three years under consideration. 6. Aggrieved by the relief granted by the CIT(A) for all the three years under consideration, Revenue is in appeal before this Tribun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... TDS under S.194H as commission payments. (iv) As regards postage expenses, printing and stationery expenses, these payments were made to courier agencies, and there is no contract with them to such postage services. These amounts were spent for purchasing stationery like files, records, memos, sales and purchase registers for all the 22 branches of the assessee, and therefore, the TDS provisions are not applicable. (v) As regards the payments towards rent, rent was paid to several parties and rent paid to each party was below ₹ 1,20,000 per annum and hence, the provisions of S.194I are not applicable. (vi) As regards consultancy chares, these charges were paid for specialised matters like ESI, PF Accounts etc. and there ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... roves that there was a reasonable cause for the failure under the said provisions. I find that S.271C finds place in the provisions of S.273B of the Act. In the case before me, the assessee has submitted an explanation for the defaults alleged against it, and even a perusal of the orders under S.201(1) and 201(1A) make it clear that the Assessing Officer has summarily raised the demands. It appears that assessee's explanation was not called for or was not considered in detail. From the narration of the assessee's explanation as given above, I find that most of the expenses like lorry hire charges, truck operating expenses, business promotion expenses, postage expenses etc. are not subject to TDS provisions. As regards the other paym ..... X X X X Extracts X X X X X X X X Extracts X X X X
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