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TMI Blog2010 (8) TMI 201X X X X Extracts X X X X X X X X Extracts X X X X ..... Mr. S.K. Posti, Amicus-curiae for the respondent. Barin Ghosh,C.J. (Oral) The respondent assessee paid salary to its employees during the relevant assessment year, but did not deduct tax in each month. It deducted tax in October, 1999 and in February, 2000. The Assessing Officer imposed interest on the assessee under Section 201 (1A) of the Income Tax Act. That was assailed before the CIT Appeals unsuccessfully. The matter was taken to the Tribunal, when the Tribunal by the judgment and order under appeal held in favour of the assessee. While doing so, the Tribunal took notice of Sub-Sections 1 and 3 of Section 192 of the Act, the provisions contained in Section 201 (1A) of the Act and various reported judgments rendered by the Tri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f sub-section (1), if any such person, principal officer or company as is referred to in that sub-section does not deduct [the whole or any part of the tax] or after deducting fails to pay the tax as required by or under this Act, he or it shall be liable to pay simple interest at [one per cent for every month or part of a month] on the amount of such tax from the date on which such tax was deductible to the date on which such tax is actually paid [and such interest shall be paid before furnishing the quarterly statement for each quarter in accordance with the provisions of sub-section (3) of section 200].]" 3. The learned counsel appearing in support of the appeal contended that in terms of Sub-Section 1 of Section 192 of the Act, tax is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in a financial year, the same can be deducted by way of adjustment during the financial year. In those 4 circumstances, the obligation to deduct at the time of payment, which is the mandate of Sub-Section 1 of Section 192, stands extended upto the end of the financial year by virtue of the provisions contained in Sub-Section 3 of Section 192 of the Act. The right to adjust, granted by Sub-Section 3, does not extend beyond the financial year. 5. The learned counsel for the appellants submitted that in view of the pronouncement as above, the provisions of Section 201 (1A) of the Act would become otiose. We do not think so. Section 201 (1A) applies only when during the financial year whole or any part of the tax deductible has not been deduc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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