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TMI Blog2018 (3) TMI 1582X X X X Extracts X X X X X X X X Extracts X X X X ..... That the learned Commissioner of Income Tax (Appeals) while upholding the order of penalty has failed to comprehend and appreciate that on the date of the passing of the order under section 201(1)there was no default of short deduction. 3. That the learned Commissioner of Income Tax (Appeals) has failed to appreciate that the amounts have already been paid so as to end dispute with Revenue and there was no contumacious conduct on the part of the assessee which is necessary for levy of penalty under section 271C. 4. That in the circumstances of the case and in law, the impugned order passed by the learned Commissioner of Income Tax (Appeals) upholding the order of penalty under section 271C passed by the addl. CIT(TDS) is based upon as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 29,54,981/- 2,35,608/- NIL 3. 13.2.2009 26,42,025/- 23,56,476/- NIL 4. 31.3.2009 25,65,011/- 23,3,249/- NIL Total Rs.93,17,920/- Rs.83,26,306/- NIL F.Y. 2009-2010 S.No, Date of credit Amount of TDS + interest Paid on 1 26.8.2009 14,60,281/- 146028/-+ 5841 = 7.1.2010 2. 31.12.2009 11,40,119/- 1,14,012/- 7.1.2010 3. Total Rs.26,00,400/- Rs.2,65,881/- 3. The assessee was liable for payment of royalty at the rate of 2% on sales made by the assessee on which TDS was to be deducted as per the agreements between them. During the course of assessment proceedings, the assessee submitted a written synopsis it was considered by the assessing officer while ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... st amounting to Rs. 5,841/- for the period from April, 2009 to 26.08.2009. The assesse company had deposited the TDS on 7.01.2010 vide challan Serial No.00290 with Punjab National Bank. The total TDS deposited vide this challan on account of royalty payment to Provogue (India) LTD forthe period upto December, 2009 was Rs. 3,23,115/- which includes the payment of TDS ability upto the period 26.08.2009 of Rs. 1,51,869/- including interest of Rs. 5,841/-.The fact of deposit PS of Rs. 1,51 869/- ON 7 Q1.2010 is also mentioned in the order passed on 22.01.2010 under section 201(1)/201(1A) by the Asst. Commissioner of Income Tax (TDS) Noida. Admittedly there was an error on the part of the assesse company in not deducting TDS on payment of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... could be levied only if there was a failure to deduct the tax at source and since in ourcase no demand was raised on account of short deduction of tax in the order passed under section 201(1) of the Act, therefore the provisions of section 271C were not applicable to the facts in our case. It is further submitted that the assesse company voluntarily filed the return and deposited the short deducted tax on its own and therefore the conduct of the assesse was not to violate the law intentionally or deliberately but on the contrary looking to the immediate response by the assessee it can be said that there was a bona fide belief which resulted into short deduction of tax and the same comes within the ambit of reasonable cause as has been h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessee is that these amounts have already been paid so as to end dispute with Revenue. In the present appeals we are concerned with levy of penalty under section 271C for which it is necessary to establish that there was contumacious conduct on the part of the assessee. We find that on similar facts Hon'ble Delhi High Court have deleted levy of penalty under section 271C in the case of M/s Itochu Corporation, reported in 268 ITR 172(Del) and in the case of CIT Vs. Mitsui & Co Ltd reported in 272ITR 545. Respectfully following the aforesaid judgements of Hon'ble Delhi High Court and the decision of the ITAT, Delhi in the case of Television Eighteen India Ltd, we allow the assessee's appeal and cancel the penalty as levied under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee had paid the entire TDS and interest amount on 07.01.2010, i.e., before passing of the order with the Punjab National Bank Challen no. 00290 which is on paper book at page no. 4. The assessee has also filed TDS return with the National Security Deposits Ltd. on dated 13.01.2010 which too is before the passing of the order by the assessing officer. 10. The case law relied by the assessee are applicable in the present case where the Hon'ble Court has held as under :- "The short issue pertains to the assessment of penalty under Section 271-C of the Income Tax Act, 1961. Against the order of Assessing Officer, the respondent took up the matter in appeal and the Commissioner of Income Tax (Appeals) deleted the levy of penalty. 2. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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