9911796707
TMI Blog2011 (3) TMI 1029X X X X Extracts X X X X X X X X Extracts X X X X ..... 1. This appeal has been filed by the assessee against the order dated 31/08/2010 of CIT(A)-III, Lucknow relating to assessment year 2009-2010. The only grievance of the assessee in this appeal relates to the confirmation of the levy of interest 201(1A) of the I.T. Act, 1961 (in short, the I.T. Act) amounting to Rs.2,15,750/- for alleged delay in depositing the TDS to the credit of the Department within time allowed. 2. The facts related to this issue, in brief, are that the DCIT (TDS), Lucknow issued a show cause notice u/s 201(1) and 201(1A) of the I.T. Act to the assessee by pointing out following short deductions on the basis of e-TDS return filed by the assessee: Short deduction u/s 194A Rs.40,266/- Short ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y order No.831222 dated 4th July 2008 in the account of Union Bank of India, Chandganj, Lucknow which is one of the authorized banks for the payment of tax and the amount was credited in account of Union Bank of India on 07/07/2008 through bankers clearing house so it was the duty of the Union Bank of India to credit the amount of income tax directly on 07/07/2008 which the said bank failed to do so, however, the assessee had discharged its liability within time, therefore, the interest should not be levied. The assessee also furnished copy of the challan vide which payment was made along with the letter of Union Bank of India dated 10/07/2010 addressed to the Branch Head that the assessee had deposited income tax of Rs.2,15,73,701/- and th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bmissions the learned D.R. strongly supported the orders of the authorities below. 6. We have considered the rival submissions and carefully gone through the material available on the record. In the present case it is an admitted fact that the assessee deducted a sum of Rs.2,15,73,701/- as TDS on the interest paid to the depositors for the month of June 2008. The due date for depositing the TDS was 7th July 2008 and the assessee deposited the said amount vide bank pay order No. 831222 dated 04/07/2008 in the account of Union Bank of India, Chandganj, Lucknow which is authorized for the purpose of deposition of tax of Income-tax authorities. The said amount was collected from the assessee through banker clearing house on 7th July 2008 i. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... regard the CBDT has issued a Circular No. 261 dated 8th August 79 stating therein that in terms of rule 80 of the Compilation of the Treasury Rules, if a cheque or draft is tendered in payment of Government dues and accepted under the provisions of rule 79 (ibid) is honoured on presentation the payment is deemed to have been made on the date on which it was handed over to the Government bankers. 6.1 The Hon'ble Gujarat High Court in the case of KANGOLD (INDIA) LTD. vs. CIT [1999] 239 ITR 842 has held as under: "That it is settled legal position that in case of payment by cheque, the payment is deemed to have been made on the date of delivery of the cheque and not on the date of encashment when the cheque was honoured. Though the che ..... X X X X Extracts X X X X X X X X Extracts X X X X
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