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TMI Blog2022 (2) TMI 238X X X X Extracts X X X X X X X X Extracts X X X X ..... the CIT (A) that there is no short deduction of TDS, the question of categorising the Appellant as Assessee-in-default for the purposes of Section 201 (1) of the IT Act did not arise. There was, therefore, no occasion for imposition of the penalty under Section 271C Department has been unable to point out how the above orders of ITAT upholding the penalty levied by the AO on the Appellant are sustainable in law. Consequently the questions framed by this Court are all answered in favour of the Appellant Assessee and against the Department - The appeal is allowed in the above terms. - ITA No.132 of 2006 - - - Dated:- 2-2-2022 - DR. S. MURALIDHAR CHIEF JUSTICE AND R. K. PATTANAIK JUDGE Petitioner Mr. P.R. Mohanty, Advocate Op ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e case the ITAT was justified in penalizing the appellant in default U/s 271C of the IT Act in absence of contravention of Section 192 of the IT Act? (iii) Whether in the facts and circumstances of the case, there exist a reasonable cause U/s 273B of the IT Act when the AO, the CIT (A) and the ITAT failed miserably to correctly ascertain the magnitude of offence U/s 192 of the I.T. Act and imposed the illegal penalty U/s 271C in a mechanical stereotyped manner? 6. At the outset it requires to be noted that the CIT (A) accepted in his order that the Appellant was not deemed to be an Assessee in default and observed as under: 4.1-Therefore, in all fairness as the employees have paid their tax liability directly through self-ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o point out how the above orders of the CIT (A) and ITAT upholding the penalty levied by the AO on the Appellant are sustainable in law. Consequently the questions framed by this Court are all answered in favour of the Appellant Assessee and against the Department by holding that the CIT (A) and the ITAT were not justified in dismissing the Appellant s appeal and in sustaining the order of the AO since there was admittedly no short deduction of TDS. The order of the AO and the corresponding orders of the CIT and ITAT to the above extent order are hereby set aside. The appeal is allowed in the above terms. There shall be no order as to the costs. 10. As the restrictions due to resurgence of COVID-19 situation are continuing, learned couns ..... X X X X Extracts X X X X X X X X Extracts X X X X
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