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TMI Blog2022 (7) TMI 534X X X X Extracts X X X X X X X X Extracts X X X X ..... ovisions of Section 194C are not applicable on payments to agencies like HUDA on behalf of the State Government. The imposition of penalty under Section 271C was consequently found to be unsustainable in the absence of default of Section 194C. The facts and issue being identical, in the light of the clarification noted above coupled with view taken by the Coordinate Bench in the identical facts situation, we see no reason to depart therefrom. Consequently, we find merit in the plea raised on behalf of the assessee for cancellation of penalty imposed under Section 271C of the Act. - Assessee appeal allowed. - I.T.A No.7674/DEL/2019 - - - Dated:- 16-6-2022 - Shri Saktijit Dey, Judicial Member And Shri Pradip Kumar Kedia, Accountant M ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r Section 194C on payment of External Development Charges (EDC) to Haryana Urban Development Authority (HUDA). With the assistance of the ld. counsel, we find that the Directorate of Town and Country Planning, Haryana (Haryana Government) has issued clarification on TDS deduction on EDC payments vide letter dated 19.06.2018 which is self explanatory and thus reproduced herein for ready reference: To The Chief Administrator, Haryana Shahari Vikas Pradhikaran, Panchkula, Memo No.DTCP/ACCTTS/Assessing Officer(HQ)/CAO/2894/2018 Date: 19.6.2018 Subject: Clarification on TDS Deductions on EDC Payments. Please refer to the matter cited as subject above. 1. Section 2(g) of the Haryana Development and Regula ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wn in favour of CA, HSVP and send the same to CA, HSVP. 4. As the receipt on account of EDC was not sufficient to carry out the all development works under EDC for the urban estate as per approved development plans, therefore to meet out the shortfall, a new scheme Swaran Jayanti Haryana Urban Infrastructure Development Scheme (renamed as Mangal Nagar Vikas Yojana was approved by the State Govt. and appropriate budget provision for execution of development works has been made in the said scheme. From Financial Year 2017-18, the receipts on account of EDC is being deposited in the consolidated fund of the State under Major Receipt Head-0217 receipts and all license/CLU holders have also been directed vide order dated 12.05,2017 that pay ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 9. The facts and issue being identical, in the light of the clarification noted above coupled with view taken by the Coordinate Bench in the identical facts situation, we see no reason to depart therefrom. Consequently, we find merit in the plea raised on behalf of the assessee for cancellation of penalty imposed under Section 271C of the Act. 3. In consonance with view taken by the Co-ordinate Bench, we hold that imposition of penalty of Rs.18,68,000/- under Section 271C of the Act for the Assessment Years 2014-15 is not justified in view of the finding of the Co-ordinate Bench that the assessee has not committed any violation of provision of Chapter XVII B of the Act by making payment towards EDC charges to DGTCP Haryana through ..... X X X X Extracts X X X X X X X X Extracts X X X X
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