1980 (10) TMI 86 - AT - Income Tax

Summary

Issues:
- Imposition of penalties under s. 272A of the IT Act, 1961 for failure to file annual returns of tax deducted at source in time.
- Contention of the assessee regarding multiple penalty orders for different branches and reasonable cause for delay in filing returns.
- Interpretation of relevant sections and rules including ss. 194A, 205, 272A, 285, and r. 116 of the IT Rules.
- Application of principles from Hindustan Steel case (1972) 83 ITR 26 (SC) on technical defaults and penalties.
- Examination of whether the delay in filing annual returns was justified and the validity of penalties imposed.

Analysis:
The judgment involves appeals against penalties imposed under s. 272A of the IT Act, 1961 for the assessee's failure to file annual returns of tax deducted at source on time for multiple branches. The contention raised by the assessee included the argument that separate penalty orders for each branch were unwarranted as the delays were part of a single act and that there was a reasonable cause for the delay due to audit preparations. The assessee also referred to various sections and rules such as ss. 194A, 205, 272A, 285, and r. 116 of the IT Rules.

The tribunal examined the relevant provisions and rules, particularly r. 116 of the IT Rules, which required the filing of one consolidated return by the assessee. It was noted that separate forms were to be filed based on the status of payees, not branch-wise. The tribunal found merit in the assessee's argument that only one Form No. 50 was to be filed, and the delay should be calculated based on the total filing time, not branch-wise. The tribunal upheld the penalties imposed for the delays in filing the annual returns.

Regarding the reason provided by the assessee for the delay, which was being busy with audit preparations, the tribunal held that it did not constitute a reasonable cause for late compliance with statutory provisions. Citing the Hindustan Steel case, the tribunal emphasized that technical defaults do not exempt from penalties. Ultimately, the tribunal dismissed some appeals while allowing others based on the findings related to the delays and penalties imposed.