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2022 (3) TMI 779 - AT - Income TaxPenalty u/s 271CA - short collection of TCS - HELD THAT - As gone through the details of collection of the TCS @ 2% on the payment received by the assessee. The same can be verifiable from TRACE Data Base. It is observed that assessee had already filed the TCS return for amount more than the amount calculated by the AO in his order. The ld. CIT(A), NFAC, Delhi also did not find any short fall of TCS amount during the appellate proceedings before him. Therefore, the ld. CIT(A) NFAC, Delhi has directed the AO to verify the records and allow the credit of taxes paid by the assessee. Hence, taking into considerations the details of TCS collection @ 2% received by the assessee from TRACE Data Base, we find that the ld. CIT(A), NFAC, Delhi vide his order dated 20-07-2021 has rightly allowed the appeal of assessee for Statistical purposes. When the quantum of appeal has been allowed by the ld. CIT(A), NFAC, Delhi then there is no need to impose penalty by the JCIT TDS and subsequently confirmed by the ld. CIT(A), NFAC Delhi - Thus the appeal of the assessee is allowed.
Issues Involved:
1. Confirmation of penalty under Section 271CA for short collection of Tax Collected at Source (TCS). 2. Delay in filing appeals. 3. Verification of TCS collection and credit of taxes paid. Detailed Analysis: 1. Confirmation of Penalty under Section 271CA for Short Collection of TCS: - ITA No. 131/JP/2021 (A.Y. 2016-17): The assessee challenged the penalty of ?1,41,840/- imposed under Section 271CA for short collection of TCS. The CIT(A), NFAC, Delhi confirmed the penalty, stating the appellant failed to provide a reasonable cause for the short collection. The assessee argued that the CIT(A) had allowed the appeal for statistical purposes, directing the AO to verify records and allow credit for taxes paid. The Tribunal found that the assessee had already filed TCS returns for an amount exceeding the calculated TCS, and thus, there was no need for the penalty. The appeal was allowed. - ITA No. 192/JP/2021 (A.Y. 2017-18): The assessee contested the penalty of ?7,46,900/- under Section 271CA. The Tribunal noted that the issue was similar to ITA No. 131/JP/2021, where the appeal was allowed. Consequently, the appeal for this year was also allowed. 2. Delay in Filing Appeals: - ITA No. 192/JP/2021: There was a delay of 25 days in filing the appeal. The assessee cited the Supreme Court's order dated 23rd September 2021, which extended the limitation period due to the COVID-19 pandemic. The Tribunal accepted the delay and allowed the appeal. - ITA No. 326/JP/2021 (A.Y. 2017-18): A delay of 32 days in filing the appeal was noted. The assessee again referred to the Supreme Court's order. The Tribunal accepted the delay and allowed the appeal. - ITA No. 327/JP/2021 (A.Y. 2018-19): Similar to ITA No. 326/JP/2021, there was a delay of 32 days. The Tribunal accepted the delay based on the Supreme Court's order and allowed the appeal. 3. Verification of TCS Collection and Credit of Taxes Paid: - ITA No. 326/JP/2021 (A.Y. 2017-18): The assessee disputed a demand of ?9,48,560/- for short collection of TCS, including interest. The CIT(A) confirmed the demand. The assessee argued that the CIT(A) did not provide a reasonable opportunity for a hearing and that the TCS collection was verifiable from the TRACE database. The Tribunal restored the appeal to the AO for verification and allowed it for statistical purposes. - ITA No. 327/JP/2021 (A.Y. 2018-19): The assessee contested a demand of ?9,43,660/- for short collection of TCS, including interest. The CIT(A) confirmed the demand. The Tribunal noted that a similar issue was decided in favor of the assessee for A.Y. 2016-17, directing the AO to verify records and allow credit for taxes paid. The appeal was restored to the AO for verification and allowed for statistical purposes. Conclusion: The appeals in ITA No. 131 & 192/JP/2021 were allowed, and the appeals in ITA No. 326 & 327/JP/2021 were allowed for statistical purposes. The Tribunal emphasized the need for verification of the TCS collection and credit of taxes paid, ensuring that the assessee was not penalized unjustly.
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