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TMI Blog2022 (6) TMI 749X X X X Extracts X X X X X X X X Extracts X X X X ..... if they have claimed it per their returns of income for the relevant years. Rather, as observed by the ld. CIT(A), the proper course, even in such a case, is for the payees to obtain a certificate of deduction of tax at source u/s. 197 at nil or a lower rate, only which would enable the assessee to either not deduct tax at source or do so at a lower rate. Further, as we see it, it is only where the fact of exemption from tax of the payee s income, which is subject to TDS, is admitted and unqualified, as where it is not hinged by or subject to any conditionality, that perhaps one could argue of non-liability to TDS (inasmuch as the tax deduction provisions would extend only to income chargeable to tax), else not (see G.E. India Technolog ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... consolidated order dated 16/11/2015. The appeals raising the same issues, per identically worded grounds, the same were heard together, and are being disposed of per a common, consolidated order. 2. The short issue/s in these appeals is the maintainability of the order/s u/s. 201 201(1A) for failure to deduct tax at source and interest thereon (for the delayed deposit with the Central Government) respectively for the relevant years, since upheld by the first appellate authority. 3. The assessee is a Department of the State Government engaged in supply of food grains through Public Distribution System (PDS) in the area of district Jabalpur, MP, for which it gets grants primarily from the Central Government. For the purpose, as ex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rgument which cannot be accepted . The aspect of there being no loss to revenue because deductee societies are exempted from tax is a plea which can be examined only in course of regular assessment and not in TDS proceedings. The liability to deduct TDS within my understanding cannot be diluted or removed even if the income of recipient is exempt. In any case, there is a specific procedure which is already prescribed u/s 197 of the IT Act which could have been resorted to by the deductee. However, this provision has not been utilised. The reasoning of the AO is crystal clear and the aspect of non-deduction of TDS on the various heads clearly stands admitted. It is also not the case of the assessee that these payments did not attract TDS in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... CIT(A) failed to examine whether income of recipient is exempt from tax or whether tax has been paid by the recipient in view of judgment of Hon'ble Apex Court in Hindustan Cola. The ld. CIT(A) having dealt with the said aspect, Shri Srivastava, upon being enquired by the Bench in the matter, would admit that none of the societies had claimed exemption u/s. 80P, on the underlying strength of which, as also evident from the impugned order, the plea as to the applicability of the decision in Hindustan Coca Cola Beverage P. Ltd . v. CIT [2007] 293 ITR 226 (SC) was raised before the first appellate authority. It is clear that neither before him nor before us there is anything on record to exhibit the income of the payee-societies, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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