No penalty for late furnishing TDS returns if taxes is already paid in time
Fact and Issue of the case
This appeal preferred by the assessee emanates from the order of the Ld. CIT(Appeals)-1, Aurangabad dated 21.07.2017 for the assessment year 2011-12 passed u/s.272A(2)(K) r.w.s.200(3) of the Income Tax Act, 1961. The brief facts in this case are that the assesse being responsible for deduction of tax under the provisions of Chapter XVIIB of the Income Tax Act, 1961 was required to prepare and deliver or cause to be delivered to the prescribed Income Tax Authority, a quarterly statement u/s.200(3) within such time and form as prescribed under Rule 31A of the Income Tax Rules. A notice u/s.272A(2)(k) r.w.s.274 of the Act was issued to the deductor on 01.10.2012. It was brought to the notice of the deductor that the following returns were found to be filed late pertaining to Financial Year 2010-11:
|RPR No.||Form No.||Periodicity||Due date||Date of filing||Delay Days|
The Assessing Officer was of the opinion that in this case there was delay in delivering the copy of statement is 564 days, 472 days, 380 days, 452 days, 564 days, 472 days, 380 days and 260 days and the tax deductible relating to the statement in question is Rs.8,200/-, Rs.12,600/-, Rs.22,100/-, Rs.2,81,096/-, Rs.2,63,035/-, Rs.1,96,039/-, Rs.75,298/- and Rs.30,030/- respectively. Therefore, Assessing Officer held that the assessee has committed a default in not delivering the E-TDS statements within the specified time without any reasonable cause and accordingly, levied penalty of Rs.2,55,700/- u/s.272A(2)(k) of the Act.
Observation of the Tribunal
The Tribunal perused the case records and heard the rival contentions. Tribunal also considered judicial precedents placed on record. In this case penalty has been levied u/s. 272A(2)(k) of the Act due to late filing of TDS statements/returns. However, it is an undisputed fact as admitted by the parties herein, that no loss has been caused to the Revenue by the action of the assessee. There may have been procedural lapse on the part of the assessee however, due to such procedural lapse no prejudice has been caused to the Revenue. This fact has also been admitted by the Ld. DR. The assessee has also enclosed details of payments and return filed at Page 1 of the paper book which was also placed before the Department. Therein, it is evident that taxes were deducted and paid to the government account. In this case, it was also conceded by the parties that income tax deducted at source was deposited in time but only filing of statement of quarterly deduction of income tax at source was delayed beyond prescribed time. The Pune Bench of the Tribunal in the case of Nav Maharashtra Vidyalaya Vs. Addl. CIT, reported in (2016) 74 Taxmann.com 240 ( Pune Tribunal), wherein the issue of levying penalty u/s. 272A(2)(k) of the Act has been elaborately dealt with and the issue of reasonable cause that has been also discussed in detail. This case was further referred in deciding the same issue by the Mumbai Bench of the Tribunal in the case of The Board of Control for Cricket In India Vs. ACIT (TDS)-2, ITA No.1999/Mum/2017 dated 05.10.2018. The provisions of Section 272A(2)(k) are subject to provisions of section 273B of the Act and hence, the relevance of reasonable cause has to be established. For the sake of completeness, the observations and findings of the Pune Bench of the Tribunal.
Similarly, the Jaipur Bench of the Tribunal in the case of Argus Golden Trades India Ltd. Vs. JCIT reported in (2017) 50 CCH 0071 ( Jaipur-Tribunal) and Lucknow Bench of the Tribunal in the case of Punjab National Bank v. ACIT (2011) 140 TTJ 0622 (Lko.) has deleted the penalty levied u/s.272A(2)(k) of the Act. Similarly, Delhi Bench of the Tribunal in the case of Haryana Distillery Ltd. Vs. Joint Commissioner of Income Tax (supra.), the question arose whether since on filing belated returns/statements, Revenue had not suffered any loss because tax deducted was already deposited on time and there was mere technical or venial breach to provisions contained in Act for submitting return/statements of TDS. Therefore, penalty was not to be levied and question was answered in favour of the assessee.
Respectfully following the aforesaid judicial pronouncements which are in conformity with the facts and circumstances in the present case before us and following the same parity of reasoning, we set aside the order of the Ld. CIT(Appeals) and direct the Assessing Officer to delete penalty from the hands of the assessee.
In the result, appeal of the assessee is allowed.
Read the full order from belowNo-penalty-for-late-furnishing-TDS-returns-if-taxes-is-already-paid-in-time