9911796707
TMI Blog2014 (12) TMI 20X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Income Tax Act, 1961 (hereinafter referred to as 'the Act') has called in question the common order dated February 21, 2014 made by the Income Tax Appellate Tribunal, 'A' Bench, Ahmedabad, in I.T.A. No.625/Ahd/2013 by proposing the following common question stated to be a substantial question of law in each of the appeals : "Whether the Income Tax Appellate Tribunal has substantially erred in law and on facts by upholding the order of the CIT(A) to delete the penalty under section 271C of the Act of Rs. 10,25,957/- ?" 3. The assessment years are 2007-08, 2008-09 and 2009- 10. The assessee, a company, is assessed as such and is engaged in the activity of generati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ction 201 read with section 201(1A) of the Act and that the assessee had reasonable cause for not deducting the tax at source on reimbursement of food expenses, that is, canteen subsidy scheme and that no material had been brought on record by the Assessing Officer to the effect that the assessee deliberately defied the provisions of law. The revenue carried the matter in appeal before the Tribunal, but failed. 4. Mr. M.R. Bhatt, Senior Advocate, learned counsel for the appellant, submitted that the Tribunal was not justified in confirming the order passed by the Commissioner (Appeals) inasmuch as the assessee had effected the deduction of tax at source on reimbursement of canteen subsidy scheme till survey proceedings were undertaken by t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... she has categorically recorded a finding that Assessing Officer had not initiated the penalty proceedings at the assessment stage while making the order under sections 201 and 201(1A) of the Act, and it was only by the show cause notice dated March 02, 2012 that the Additional Commissioner of Income Tax had initiated proceedings under section 271C of the Act. After considering the evidence on record, the Commissioner (Appeals) was of the view that the rejection of the Assessing Officer of the assessee's contention that it was a bona fide mistake on the ground that the assessee had not surrendered the mistake committed by it before the Assessing Officer before the order under section 201 and 201(1A) was passed, but had agitated the matt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e was bona fide omission on the part of the assessee in not deducting the tax at source, no penalty can be leviable. 7. Having regard to the submissions made by the learned counsel for the appellant and the findings recorded by the Commissioner (Appeals) as well as the Tribunal, it is apparent that both the Commissioner (Appeals) and the Tribunal have found, as a matter of fact, that there was bona fide mistake on the part of the assessee in not deducting the tax at source and that there was no deliberate intention or negligence on the part of the assessee in not deducting the tax at source. Thus, both, the Tribunal as well as the Commissioner (Appeals), have concurring found that the assessee had made out a reasonable cause for failure in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ient reason for not deducting the tax. The burden, of course, is on the person to prove such good and sufficient reason. In each of the 104 cases before us, we find that non-deduction of tax at source took place on account of controversial addition. The concept of aggregation or consolidation of the entire income chargeable under the head "Salaries" being exigible to deduction of tax at source under section 192 was a nascent issue. It has not been considered by this court before. Further, in most of these cases, the tax deductor-assessee has not claimed deduction under section 40(a)(iii) in computation of its business income. This is one more reason for not imposing penalty under section 271C because by not claiming deduction under section ..... X X X X Extracts X X X X X X X X Extracts X X X X
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