TMI Blog2021 (9) TMI 622X X X X Extracts X X X X X X X X Extracts X X X X ..... essee on this issue are allowed. - ITA Nos. 1528, 1529 And 1530/H/2016 - - - Dated:- 6-9-2021 - Shri Satbeer Singh Godara, Judicial Member And Shri Laxmi Prasad Sahu, Accountant Member For the Assessee : None For the Revenue : Shri Rohit Mujumdar ORDER PER L.P. SAHU, A.M.: These three appeals filed by the assessee are directed against CIT(A) - 8, Hyderabad s separate orders, all dated 22/08/2016 for AYs 2009-10 to 2011-12 involving proceedings u/s 272A(2)(k) of the Income- Tax Act, 1961; in short the Act . As the facts and grounds are identical in all these appeals, the same were clubbed and heard together and, therefore, a common order is passed for the sake of convenience. Therefore, the decision taken in AY 2009-10 shall mutatis-mutandis apply to the other appeals as well. 2. The grounds raised by the assessee, which are common in all the appeals, except quantum of additions, are as under: 1. The CIT (Appeals) is not justified in ignoring the fact that in spite of new filing procedure, the assessee filed TDS quarterly return in respect of Form No. 26Q voluntarily before conducting survey and in 24Q for the applicable quarter. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 09-10 are that the assessee deductor AP Health Medical Housing Infrastructure Development Corporation is a State Government Organization. A survey operation U/s.133A was conducted in the premises of the assessee-deductor by the Income-tax Officer (TDS), Ward-3(2)r Vijayawada, on 05/01/2011. During the course of survey, it was found that, the assessee-deductor had failed to file TDS Quarterly Statements/Returns U/s.200(3) of the LT. Act for the F.Y.2008-09 relevant to the AY 2009-10 in respect of all the four quarters in form No.24Q 26Q. 3.1 The AO observed that in the case of assessee-deductor, proposals were forwarded by the Income-tax Officer, Ward-3(2), Vijayawada, to this office for levy of penalty U/s.272A(2)(k) of the Income-tax Act, 1961, as the assessee-deductor had not filed quarterly TDS statements in Form No.24Q and 26Q for all the four quarters of the F.Y.2008-09 within the time prescribed by the I.T. Act. 3.2 On verification of the computerized database of the Income-tax department, it was noticed that the assessee failed to file quarterly TDS statements in form No.24Q 26Q for all the 4 quarters of the F.Y. 2008-09 as per the provisions of section 200(3 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 24Q 3rd Quarter 15/01/2008 Not filed 1477 24Q 4th Quarter 15/06/2008 16/02/2011 611 26Q 1st Quarter 15/07/2008 13/09/2010 790 26Q 2nd Quarter 15/10/2008 13/09/2010 698 26Q 3rd Quarter 15/01/2008 13/09/2010 606 26Q 4th Quarter 15/06/2009 13/09/2010 455 Since the assessee-deductor not filed quarterly returns within the stipulated dates, the AO calculated the penalty taking into consideration the numbers of days delay u/s 272A(2)(k), which comes to ₹ 7,76,270/-. 4. When the assessee carried the matter in appeal before the CIT(A), the CIT(A) confirmed the penalty order. 5. Aggrieved by the order of CIT(A), the assessee is in appeal before the ITAT. 6. At the time of hearing these appeals, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... IT, reported in (2016) 74 Taxmann.com 240 ( Pune Tribunal), wherein the issue of levying penalty u/s. 272A(2)(k) of the Act has been elaborately dealt with and the issue of reasonable cause that has been also discussed in detail. This case was further referred in deciding the same issue by the Mumbai Bench of the Tribunal in the case of The Board of Control for Cricket In India Vs. ACIT (TDS)-2, ITA No.1999/Mum/2017 dated 05.10.2018. The provisions of Section 272A(2)(k) are subject to provisions of section 273B of the Act and hence, the relevance of reasonable cause has to be established. For the sake of completeness, the observations ITA No. 2410/PUN/2017 A.Y.2011-12 and findings of the Pune Bench of the Tribunal in the above referred case are as follows: 17. We have heard the rival contentions and perused the record. In this bunch of appeals, the issue which arises for adjudication is against the levy of penalty under section 272A(2)(k) of the Act for late filing of TDS statements / returns. In this regard, reference is being made to the relevant provisions of the Act. Under Chapter XVII of the Act, duty is upon the person making certain payments to deduct tax at source u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... deliver to the prescribed authority a correction statement for rectification of any mistake or to add, delete or update the information furnished in the statement delivered under this sub-section in such form and verified in such manner as may be specified by the authority. 19. Under section 200(1) of the Act, it is provided that any person deducting any sum in accordance with the provisions of the Chapter shall pay within the prescribed time, the sum so deducted to the credit of the Central Government or as the Board directs. Under section 200(2) of the Act, any person being an employer, as referred to in sub-section (1A) of section 192 of the Act shall pay, within the prescribed time, the tax to the credit of the Central Government or as the Board directs. Under sub-section (2A) of the Act, it is provided that where the sum has been deducted in accordance with foregoing provisions of the Chapter, by the office of the Government, then duty is upon the Treasury Officer or the Drawing Disbursing Officer or any other person, to deliver or cause to be delivered to the prescribed income tax authorities, or to the person authorized by such authority, I.T.A. No.1999/Mum/2017 s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts electronically in accordance with the format and standards prescribed became mandatory. The deductor in the said statement of tax deducted at source was compulsorily required to quote its tax deduction and Collection Account Number i.e. TAN number. Further, quote its Permanent Accountant Number except in the case where the deductor was office of Government and also quote PAN number of all the deductees. Further, the deductor was required to furnish the particulars of tax paid to the Central Government including Book I.T.A. No.1999/Mum/2017 Identification Number or challan indication number as the case may be. He was also required to furnish the particulars of amount paid or credited on which tax was not deducted. 21. In view of various provisions of the Act, as pointed out above, the substitution was made by Income Tax (Sixth) Amendment Rules, 2010 and was applicable for the financial year 2010-11. Since e-compliance of TDS returns was introduced in the said financial year, there was time and again amendments/corrections in order to make system of filing TDS returns user-friendly. The learned Authorized Representative for the assessee has pointed out that there were about ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... icult and in the absence of any technical support in this regard, default if any, in furnishing the TDS returns late should be condoned. Another plea raised by some of the assessee was that where the tax deducted at source was not paid in time, e-TDS returns as such could not be filed and hence, the assessee was prevented by reasonable cause in not filing e- TDS returns in time and as such, no merit in levy of penalty. Another plea raised before us is that charging of fees for each day of default and then, restricting the same to the tax deducted at source was not correct. One another aspect of reasonableness was that in case the returns for quarter 1 was filed belatedly, then the returns for consequent quarters also got delayed for no default and as such, no penalty was leviable for such quarters. Different learned Authorized Representatives appearing before us has made reference to the decisions of various Benches of Tribunal. On the other hand, the learned Departmental Representative for the Revenue has placed reliance on the ratio laid down by the Hon'ble Allahabad High Court in Raja Harpal Singh Inter College's case (supra) and Chandigarh Bench of Tribunal in Central S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ns. However, since assessment year 2011-12 was the first year of introduction of such facilities of e-TDS returns, there were certain hindrances which were taken care of by the authorities by way of various amendments introduced in this behalf. The case of the assessee on the other hand, is that they were small taxpayers and in the absence of technical guidance provided and because of technical hitches, the TDS returns could not be filed in time. Most of the assessee before us have paid the tax deducted at source to the Treasury within time frame but have defaulted in filing e-TDS statements. In some of the cases, there is default in payment of tax deducted at source and consequently, delay in filing the e-TDS returns. The question which arises is whether in the abovesaid scenario, can the provisions of section 273B of the Act can be applied in order to decide the issue of levy of penalty under section 272A(2)(k) of the Act. 24. The Hon'ble Punjab Haryana High Court in HMT Ltd. v. CIT [2005] 274 ITR 544/[2004] 140 Taxman 606 had held that where the tax deducted at source had been paid in time and the necessary returns in respect thereto were filed in time with the Inco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ficiating Principal had been working, who did not have idea of e-TDS statements and requirement of filing the same. The Tribunal noted that the appellate authority had accepted the explanation offered by the assessee and imposed penalty only from 01.04.2010 though regular Principal had joined the college on 25.01.2010. The Tribunal dismissed the appeal of assessee as no explanation was furnished for non-furnishing TDS statements in time. The Hon'ble High Court thus, in this regard observed that the requirement of filing e-TDS statements in time could not be overlooked. In such circumstances, the Hon'ble High court held that it cannot be urged by the Counsel for the assessee that no penalty could have been imposed for non-filing e-TDS returns in time since it had not resulted in any loss to the Revenue. The Hon'ble High Court further took note of the fact that before the Assessing Officer, no explanation was offered. However, an explanation was offered before the appellate authority, which was taken into consideration and the penalty amount was suitably reduced as the case of appellant that regular Principal assumed charge on 25.01.2010, was accepted and the penalty was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and in the absence of any explanation of the assessee, we find no merit in the reliance placed upon on such decision by the learned Departmental Representative for the Revenue. 28. On the other hand, various Benches of Tribunal have time and again held that where there was case of reasonableness, there was no merit in levying the penalty under section 272A(2)(k) of the Act. Thus, in order to adjudicate the issue before us, we accept the case of reasonable cause as relevant to section 273B of the Act put up by the assessee in the respective cases in the appeals before us, which admittedly relate to different quarters of assessment year 2011-12. Where for the first time, there was requirement of e-TDS furnishing of TDS statement and since there were certain complications in e-filing of TDS returns because of system failure, which admittedly, was amended 18 times by the Department, the delay in furnishing the said returns late I.T.A. No.1999/Mum/2017 could not be attributed to the assessee. The onus was upon the authorities to provide platform for easy compliance to newly introduced provisions of the Act. Where such facilities could not be provided by the authorities and the t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Tribunal in the case of Argus Golden Trades India Ltd. Vs. JCIT reported in (2017) 50 CCH 0071 ( Jaipur- Tribunal) and Lucknow Bench of the Tribunal in the case of Punjab National Bank v. ACIT (2011) 140 TTJ 0622 (Lko.) has deleted the penalty levied u/s.272A(2)(k) of the Act. Similarly, Delhi Bench of the Tribunal in the case of Haryana Distillery Ltd. Vs. Joint Commissioner of Income Tax (supra.), the question arose whether since on filing belated returns/statements, Revenue had not suffered any loss because tax deducted was already deposited on time and there was mere technical or venial breach to provisions contained in Act for submitting return/statements of TDS. Therefore, penalty was not to be levied and question was answered in favour of the assessee. 8. Respectfully following the aforesaid judicial pronouncements which are in conformity with the facts and circumstances in the present case before us and following the same parity of reasoning, we set aside the order of the Ld. CIT(Appeals) and direct the Assessing Officer to delete penalty from the hands of the assessee. 8.1 Respectfully following the aforesaid decision, we set aside the order of the CIT(A) a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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