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TMI Blog2020 (5) TMI 456X X X X Extracts X X X X X X X X Extracts X X X X ..... tion 197A(IB) which overrides the provisions of section 197A(IA) - in terms of section 197A(1C), it has been provided that no deduction of tax shall be made in the case of an individual resident in India, who is of the age of sixty years or more at any time during the previous year, if such individual furnishes to the person responsible for paying any income of the nature referred to section 194A, a declaration in writing in duplicate in the prescribed form and verified in the prescribed manner to the effect that the tax on his estimated total income of the previous year in which such income is to be included in computing his total income will be nil. Coming to the specific transactions under considerations, the assessee bank has relied on the declaration in Form 15G furnished by Shri Vimal Mehta for financial year 2010-11 and 2011-12 and in Form 15H furnished by Smt Prem lata Bhateja who is over sixty years of age during the financial year 2012-13 and 2013-14 respectively and has not deducted tax while crediting/paying the interest in the respective financial years. As far as payment/credit of interest to Smt Prem Lata Bhateja who is over sixty years of age during the financial ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for A.Ys 2010-11, 2011-12, 2012-13 2013-14 respectively. Since the common issues are involved and identical grounds of appeal have been taken, all these appeals were heard together and are being disposed off by this consolidated order. 2. In Ground No. 1, the assessee has challenged the action of ld. CIT(A) in confirming penalty imposed u/s 271C as per the original order passed by the ACIT(TDS) dated 22.03.2016 and ignorance of rectified order passed by the DCIT(TDS) dated 23.11.2016. 3. In this regard, ld. AR submitted that the Assessing Officer has passed the consolidated order for A.Y 2009-10 to A.Y 2013-14 u/s 201(1) and 201(1A) of the Act dated 22.03.2016 wherein the demand was created due to non-deduction of TDS on submission of Form No. 15G/15H in cases where interest paid exceeds basic exemption limit. Subsequently, the assessee s bank had applied for rectification of the order and order u/s 154 was passed by the DCIT(TDS) dated 23.11.2016 wherein the demand was reduced as per particulars below: Assessment Year Original demand (Rs) Revised demand (Rs) 2010-11 31,486/- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... been dropped. 7. In Ground No. 3, the assessee has challenged the imposition of penalty u/s 271C raising the plea that it has acted in good faith, bona fide belief and without any male fide intention in relying on the declaration submitted by the depositors in Form No. 15G/15H. 8. In this regard, it was submitted by the ld. AR that one of the reasons for levy of penalty as stated by the Addl.CIT(TDS) while imposing the penalty is that declarations in Form No. 15G/15H were not produced either before the AO during the assessment proceedings or during the appellate proceedings before him. It was submitted that the present proceedings have itself started with non deduction of TDS on submission of Form 15G/15H as stated by the AO in his original order dated 22.03.2016. It was submitted that where the Department has already accepted that these forms/declarations had been provided by the customers, no question arises for providing the same in reply to the show cause notice u/s 271C of the Act. It was further submitted that Form No. 15G/15H is a declaration submitted by the customer for non deduction of TDS and the bank has deducted TDS in all cases accept where these declarations we ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... DR that merely relying on the declaration so submitted by the customers in Form No. 15G/15H cannot be a basis for non deduction of TDS and the assessee bank is required to carry out certain basic due diligence while accepting such declaration and in the instant case, where the interest so paid or credited exceeds basic exemption limit as provided in the Income tax Act for the respective assessment years, the assessee bank cannot be absolved of its responsibility to deduct TDS on such payment/credit of interest to its customers. Further, the ld. DR relied on the findings of the Addl.CIT(TDS) as well as the order of ld. CIT(A). 12. We have heard the rival contentions and purused the material available on record. Section 271C of the Act provides that if any person fails to deduct whole or any part of the tax as required, then he shall be liable to pay by way of penalty a sum equal to the amount of tax which he has failed to deduct. At the same time, Section 273B of the Act provides that notwithstanding the provisions contained under Section 271C of the Act, no penalty shall be imposable upon the person or the assessee for any failure referred to in the aforesaid provision if the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... shall be made in the case of an individual resident in India, who is of the age of sixty years or more at any time during the previous year, if such individual furnishes to the person responsible for paying any income of the nature referred to section 194A, a declaration in writing in duplicate in the prescribed form and verified in the prescribed manner to the effect that the tax on his estimated total income of the previous year in which such income is to be included in computing his total income will be nil. 14. Coming to the specific transactions under considerations, the assessee bank has relied on the declaration in Form 15G furnished by Shri Vimal Mehta for financial year 2010-11 and 2011-12 and in Form 15H furnished by Smt Prem lata Bhateja who is over sixty years of age during the financial year 2012-13 and 2013-14 respectively and has not deducted tax while crediting/paying the interest in the respective financial years. Therefore, as far as payment/credit of interest to Smt Prem Lata Bhateja who is over sixty years of age during the financial year 2012-13 and 2013-14, in terms of provisions of section 197A(1C), there is a reasonable cause for non-deducting the TDS an ..... X X X X Extracts X X X X X X X X Extracts X X X X
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