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2021 (2) TMI 214 - AT - Income TaxLevy of penalty u/s. 272A(2)(k) - delay in preparation and delivery to the prescribed returns if the prescribed form is caused on account of non-availability of the details such as PAN, address further valid tee of challans paid, Generation of CSI file etc.- HELD THAT - There is no delay in submission and filing of the prescribed returns from the date of TDS amount credited to the Central Government account. The approach of the lower authorities in computing the period of default from the date of deduction of tax at source instead of date of payment of TDS amount credited to the Central Government account is unreasonable and contrary to the plain provisions of the relevant Rules. In case where tax amount has not been remitted to the credit of the Central Government, the question of issuing certificate of tax deduction at source u/s. 200(3) of the Act or filing the return under the provisions of sub-section (3) of section 200 of the Act would not arise at all. That being the case the question of imposing penalty for violation of the above said provisions would also not arise - provisions of Income Tax Act prescribe different penalties for non-deduction as well as the delay in remittance of the amount to the Central Government. It is trite law that the two different penalties cannot be imposed by the Parliament for the same offence. We are of the considered opinion that the levy of penalty u/s. 272A(2)(k) of the Act is not justified in the present facts of the case. According we set-aside the impugned order and directed to delete the penalty. - Decided in favour of assessee.
Issues Involved:
1. Levy of penalty under Section 272A(2)(k) of the Income Tax Act, 1961 for the assessment year 2012-13. 2. Determination of the period of default for the purpose of penalty calculation. 3. Validity of the penalty in light of the delay in filing TDS returns. Detailed Analysis: Levy of Penalty under Section 272A(2)(k): The appeal was filed against the order confirming the levy of penalty under Section 272A(2)(k) of the Income Tax Act, 1961. The penalty was imposed due to the late filing of TDS returns for various quarters of the assessment year 2012-13. The relevant facts highlighted that the returns were filed with delays ranging from 87 to 404 days. The appellant argued that the delay was due to the non-availability of necessary details such as PAN, address, and challan validation. Determination of the Period of Default: The appellant contended that the penalty should be levied from the date of remittance of TDS to the Central Government, not from the date of deduction. The lower authorities computed the period of default from the date of deduction, which the appellant argued was unreasonable and contrary to the provisions of the Act. The Tribunal examined the relevant provisions, including Section 200(3) and Rule 31A, which mandate filing returns after paying the tax deducted to the credit of the Central Government. Validity of the Penalty: The Tribunal noted that the lower authorities' approach in computing the default period from the date of deduction was incorrect. The Tribunal emphasized that the penalty provisions under Section 272A(2)(k) apply only after the tax is credited to the Central Government. The Tribunal referenced the decision of the Hon'ble Allahabad High Court in CIT vs. Sri Ram Memorial Education Promotion Society, which clarified that penalties under Sections 203 and 206 apply only when tax is deducted at source and not otherwise. The Tribunal concluded that imposing a penalty for the delay in filing returns was unjustified since the returns were filed within the prescribed time after the tax was credited to the Central Government. Conclusion: The Tribunal held that the levy of penalty under Section 272A(2)(k) was not justified in the present case. The impugned order was set aside, and the penalty was directed to be deleted. The appeal of the assessee was allowed, emphasizing that different penalties cannot be imposed for the same default and that the correct period of default should be considered from the date of remittance of TDS to the Central Government. Order Pronounced: The order was pronounced on January 20, 2021, allowing the assessee's appeal and directing the deletion of the penalty.
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