TMI Blog2017 (5) TMI 1709X X X X Extracts X X X X X X X X Extracts X X X X ..... ordinarily prudent and cautious man, placed in the position of the person concerned, to come to the conclusion that same was the right thing to do. The cause shown has to be considered and only if it is found to be frivolous, without substance or foundation, the prescribed consequences follow. In view of the same we agree with the Ld.CIT(A) that the assessee had reasonable cause for not collecting tax at source ,the absence of which is essential for levying penalty as held by the Delhi High Court in the case of woodward governor [2001 (4) TMI 34 - DELHI HIGH COURT] . We therefore uphold the order of the Ld. CIT(Appeals) deleting the levy of penalty under section 271CA of the Act. - Decided in favour of assessee. - ITA No. 1311/Chd/20 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re 7th day of next month in which sale of scrap was made. (iii) The Ld.CIT(A) is erred in deleting the penalty u/s 271CA for non-collection tax at source u/s 206C ignoring the fact that the assessee has committed default for non collection of tax at source as required under the provisions of section 206 of the I.T. Act, 1961. (v) The Ld.CIT(A) is erred in deleting the penalty u/s 271CA ignoring that the assessee continuously denying from the start to the end that he had purchased Scrap even in the auction sellers has classified the material as scrap. (vi) The Ld. CIT(A)'s findings that where the purchaser has paid the tax on his income, the revenue can only charge interest on the tax not so collected u/s 20 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ow cause notice the assessee filed his reply and relied on a judgement in the case of Wipro GE Medical Systems Ltd (2005) 24 CCH 0001 Bangalore Tribunal given by Hon ble I.T.A.T. The Assessing Officer did not accept the said judgment for the reason that the same had not reached finality and chose to follow CBDT letter F.No.275/17/2013-IT(B) dated 16.7.2013 with regard to the application of section 206C. Since the assessee-deductor had not collected TCS at the rate of 1% on sales of ₹ 18,18,35,801/- as required under the provisions of chapter XVII BB of the Income Tax Act, 1961 and also failed to submit any reasonable cause for non collection of tax at source, the Assessing Officer held that the assessee was liable to pay, by way of pe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sed in ITA No.560/Chd/2016 relating to assessment year 2011-12. We have gone through the order of the Tribunal dated 30.12.2016. We find that the Tribunal while deleting the penalty in the own case of the assessee has followed the order of the Coordinate Bench of the Tribunal in the case of ITO(TDS), Patiala Vs. Shri Om Prakash Gupta(HUF) in ITA Nos.341 342/Chd/2016 dated 20.6.2016. The operative part of the said order is reproduced as under: 11. We find that the belief harboured by the assessee, considering the facts narrated above constituted a reasonable belief which an ordinary person in the prevailing circumstances would have harboured. It is not the case that the assessee was found liable to collect tax at source on the g ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... laced in the position of the person concerned, to come to the conclusion that same was the right thing to do. The cause shown has to be considered and only if it is found to be frivolous, without substance or foundation, the prescribed consequences follow. 12. In view of the same we agree with the Ld.CIT(A) that the assessee had reasonable cause for not collecting tax at source ,the absence of which is essential for levying penalty as held by the Delhi High Court in the case of woodward governor (supra).We therefore uphold the order of the Ld. CIT(Appeals) deleting the levy of penalty under section 271CA of the Act. The appeal of the revenue is accordingly dismissed. 9. Respectfully following the precedent, we ..... X X X X Extracts X X X X X X X X Extracts X X X X
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