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TMI Blog2014 (12) TMI 635X X X X Extracts X X X X X X X X Extracts X X X X ..... years thereafter that a notice was issued - For an assessee to be required to pay the amount, even if due five or six years preceding the demand, would be a serious problem questions of law framed by the Tribunal for the adjudication are upheld Decided against revenue. - I.T.T.A No. 331 of 2003 - - - Dated:- 12-11-2014 - L. Narasimha Reddy And Challa Kodanda Ram,JJ. For the Appellant : Sri S. R. Ashok, Senior Standing Counsel JUDGMENT (Per the Hon'ble Sri Justice L. Narasimha Reddy) The respondent is a company and an assessee under the Income Tax Act, 1961 (for short, the Act). It has been submitting returns year after year disclosing the relevant information pertaining to the income, expenditure, deduction ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nal). The appeals were allowed through order dated 19-08-2002. Hence, this appeal. Heard Sri S.R. Ashok, learned Senior Standing Counsel for the appellant. Section 201 of the Act imposes an obligation on not only an assessee but also any person including the principal officer of a company to deduct tax at source on any amount that is paid by them to another. Failure to effect such deduction and remittance of the same to the department exposes them to the obligation not only for payment of the same on demand but also to pay the interest. The respondent no doubt was paying interest to its sister concerns on the loans borrowed by it year after year. However, for the three assessment years 1989-90, 1990-91 and 1991-92 it did not deduct an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed was passed. The examples can be multiplied. If for important and substantial proceedings like those under Section 148 of the Act and the suo motu proceedings under Section 263 of the Act limitation prescribed is four years and two years respectively, an ordinary and inconsequential step relating to deduction of tax at source cannot be permitted to be initiated beyond the period so stipulated. By and large, four years is treated as the period within which any penal action can be initiated against an assessee. Failure to initiate steps within that period would disable the department to proceed against the assessee. The reason is not difficult to be discerned. With each passing year, the assessee is required to adjust his or her own affa ..... X X X X Extracts X X X X X X X X Extracts X X X X
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