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TMI Blog2019 (10) TMI 189X X X X Extracts X X X X X X X X Extracts X X X X ..... original order of the CIT(A) was received on 2nd August, 2018 and as per the provisions of Income Tax Act, the appeal should have been filed on 1st October, 2018, However, the appeal was filed on 15th October, 2018 due to the reason that the taxation department of the Bank was situated in Bangalore and to file an appeal before the Tribunal as per the Bank's policy it has to get approval from the Taxation Department. The original assessment order and the appellate order were sent to the department for approval. It was stated that there was change in the top executive of the Bank in the month of September and due to this change, the approval was delayed which was received only in the first week of October 2018 and the papers were submitted t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... id to the said Corporation an amount of Rs. 4,10,16,457/- as interest during the F.Y. 2008-09 but had deducted Rs. 42,31,627/- only as tax u/s. 194A of the Act. The tax deductible u/s. 194A against the interest paid to the said Corporation for the F.Y. 2008-09 was at 20.6% since the deductee is a domestic company and tax at 20.6% worked out at Rs. 84,49,390/-. Hence, the Assessing Officer found that there was short deduction of tax at Rs. 42,17,763/-. Against the said default committed in short deduction of tax, the Assessing Officer treated the assessee as assessee in default u/s. 201(1A) of the Act and directed the assessee to remit the tax of Rs. 42,17,763/- which was not deducted at source to the exchequer and further levied interest of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... they have not deducted the tax in full leaving thereby a short deduction of Rs. 42,17,763/-. He relied on the judgment of the Supreme Court in the case of Hindusthan Coca-Cola Beverages Pvt. Ltd. vs. CIT (293 ITR 226) wherein it was held that interest u/s. 201(1A) is to be paid by the assessee. Thus, the CIT(A) confirmed the interest charged u/s. 20(1A) of the Act. 6. Against this the assessee is in appeal before us. None appeared on behalf of the assessee. The Ld. AR has filed written submission wherein it was submitted that Canara Bank Cantonment branch filed the TDS returns for the Financial year 2008-09. The department found that the branch had deducted only 10% as tax from Kerala State beverages Corporation Limited (KSBC) as against ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in default. There was also a condition in the said judgment that the dedcutee assesee should have filed the return of income. It was also held by the Supreme Court that interest for short deduction under Section 201 should be paid from the first day of the assessment year till the date on which dedcutee assessee pays the tax thereon. It was submitted that during the hearing of the appeal, the details regarding the filing of returns by the deductee assessee were produced before the Commissioner(Appeals). However, the Commissioner(Appeals) after considering the details remanded the case back to the assessing officer with a direction to verify the details produced regarding the tax returns filed by the deductee assessee and give effect to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f hearing of the remanded case had held that the deductee assessee had included the interest paid by the assessee in the total income and had paid the tax thereon and completed the assessment deleting the short deduction of Rs. 42,17,763/- originally assessed. Thus, it was clear from the revised order that the department also agreed with the judgment of the Supremee Court in the case of Hindustan Coco Cola supra and the case was applicable to the assessee. 6.2 It was submitted that the Supreme Court had held in Hindustan Coco Cola supra that interest should be charged from the first day of the assessment year till the date of payment of tax by the deductee assessee. However, it was submitted that the Assessing Officer had verified the det ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al Board of Direct Taxes, in our considered opinion should put an end to the controversy. The circular declares "no demand visualized under section 201(1) of the Income Tax Act should be enforced after the tax deductor has satisfied the officer in charge of TDS, that taxes due have been paid by the deductee assessee. However this will not alter the liability to charge interest under Section 201(1A) of the Act till the payment of taxes by the deductee-assessee or the liability of penalty under Section 271C of the Income Tax Act". In the present case, the assessing officer was convinced that the deductee assessee had included the interest paid by the assessee in the total income and paid tax thereon. Based on the evidence produced, the Asses ..... X X X X Extracts X X X X X X X X Extracts X X X X
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