TMI Blog2014 (9) TMI 1171X X X X Extracts X X X X X X X X Extracts X X X X ..... are accepted by the assessee and the demand raised as per assessment order has been paid. Therefore, these circumstances would clearly reveal that the assessee has reasonable cause for failure to comply with the provisions of section. Therefore, in view it being a beginning of the assessee for failure to deduct tax and then the assessee in future has starting deducting TDS would suggest that t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... deducted the tax at source as required under the provisions of Chapter XVII-B of the Income Tax Act. The Assessing Officer levied penalty under section 271C of the Income Tax Act for a sum of ₹ 40,254/- vide separate order. The assessee submitted before the learned CIT (Appeals) that he was under bonafide belief that TDS was not to be deducted on payment made to non-banking financial instit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ized by way of addition at the time of assessment by way of disallowance of interest under section 40(a)(ia) of the Act. He has submitted that whatever addition was made has been admitted by the assessee and taxes have been paid and the assessee on realizing this mistake has started to deduct TDS in future. The copy of the assessment order for the year under consideration and demand created by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee as the case may be, for any failure referred to in the said provisions, if he proves that there was reasonable cause for the said failure. The circumstances explained by the learned counsel for the assessee clearly reveal that the assessee paid interest to non banking financial institution and did not deduct tax because the assessee was under the bonafide belief that no TDS was to be ..... X X X X Extracts X X X X X X X X Extracts X X X X
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