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2017 (5) TMI 411 - AT - Income TaxPenalty u/s 272A(2)(k) - delay in filing of the quarterly TDS statement in form no 24Q and 26Q - Held that - Assessee has come forward with the reasons that the said delay occur due to non availability of PANs in respect of few deductee parties but no details/evidences were filed by the assessee to substantiate the said contentions . It is also claimed that the director of the assessee was diagnosed with cancer , but again no details/evidences were furnished by the assessee to substantiate the said contention . The levying of the penalty u/s 272A(2)(k) of 1961 Act is not mandatory as perusal of Section 273B of 1961 will clearly reveal that the penalty u/s 272A(2)(k) will not be imposed if there was a reasonable cause for the failure. The assessee has relied on various case laws as cited above and has tried to explain a reasonable cause for the said failure so that its case gets covered by exempting provisions of Section 273B of 1961 to take it out of clutches of penalty provisions as contained u/s 272A(2)(k) of 1961 Act , but evidences were not filed by the assessee to substantiate the same. Thus we are inclined to set aside and restore this matter back to the file of the A.O. for denovo determination - Decided in favour of assessee for statistical purpose.
Issues Involved:
1. Validity and legality of the penalty order passed under Section 272A(2)(k) of the Income-tax Act, 1961. 2. Confirmation of the penalty by the Commissioner of Income Tax (Appeals) [CIT(A)]. 3. Opportunity of being heard and appreciation of facts by the CIT(A). 4. Existence of reasonable cause for delay in filing TDS statements. Detailed Analysis: 1. Validity and Legality of the Penalty Order: The appeals filed by the assessee challenge the penalty order passed under Section 272A(2)(k) of the Income-tax Act, 1961. The Assessing Officer (A.O.) observed that the assessee delayed filing quarterly TDS statements for the financial year 2008-09 beyond the time prescribed under Section 200(3) of the Act read with Rule 31A of the Income-tax Rules, 1962. The delays ranged from 437 days to 772 days. The A.O. noted that the delay resulted in non-credit of tax at source for various deductees, causing them to suffer. Consequently, the A.O. levied a penalty of ?2,89,551/-. 2. Confirmation of the Penalty by CIT(A): The assessee appealed to the CIT(A), arguing that the delay was due to the non-availability of PANs for some deductees and the illness of the company’s director. The CIT(A) dismissed the appeal, stating that the assessee did not provide evidence to substantiate the non-availability of PANs or the illness of the director. The CIT(A) upheld the penalty, emphasizing that the delay caused inconvenience to deductees who did not receive credit for TDS in time. 3. Opportunity of Being Heard and Appreciation of Facts by CIT(A): The assessee contended that the CIT(A) dismissed the appeal without giving full and proper opportunity of being heard and without appreciating the facts and circumstances of the case. The tribunal observed that the CIT(A) considered the submissions but found no evidence to support the assessee’s claims. 4. Existence of Reasonable Cause for Delay in Filing TDS Statements: The tribunal noted that the penalty under Section 272A(2)(k) is not mandatory if there is a reasonable cause for the failure, as per Section 273B of the Act. The assessee argued that the delay was due to the non-availability of PANs and the illness of the director. However, no evidence was provided to substantiate these claims. The tribunal decided to set aside the matter and restore it to the A.O. for a denovo determination. The A.O. was directed to examine the evidence provided by the assessee and determine if there was a reasonable cause for the delay, in accordance with Section 273B. If the evidence is found to be genuine and bonafide, no penalty should be levied. Conclusion: The tribunal allowed the appeals for statistical purposes, directing the A.O. to re-examine the issue on merits and provide the assessee an opportunity to present evidence. The tribunal’s decision in ITA No. 4659/Mum/2016 for the assessment year 2009-10 was applied mutatis mutandis to the appeals for the assessment years 2010-11 and 2011-12. Order Pronounced: The order was pronounced in the open court on 20th April, 2017.
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