2011 (9) TMI 1184 - AT - Income Tax

Tribunal upholds deletion of penalty for IT Act violation

Income-tax Officer, TDS-2, Ahmedabad Versus The Oriental Insurance Company Ltd.

The Tribunal upheld the deletion of the penalty under section 272A(2)(k) of the IT Act for the assessment year 2007-08. The penalty was imposed on a ... - Issues involved: Appeal against deletion of penalty u/s 272A(2)(k) of the IT Act for Asst. Year 2007-08.Summary:1. The Revenue filed an appeal against the deletion of penalty u/s 272A(2)(k) of the IT Act amounting to Rs. 5,01,800 for the assessment year 2007-08 by the ld. CIT(A).2. The assessee, a Public Limited Company, was found to have defaults in filing Form No.24Q and Form No.26Q for 2509 days each by the Addl.CIT, TDS Range, Ahmedabad. The penalty was levied by the AO @ Rs. 100 per day for a total of 5018 days of default.3. The assessee contended that the delay was due to a bona fide belief that once tax was deducted and deposited, filing the forms immediately was not necessary. The ld. CIT(A) deleted the penalty after considering the facts and legal provisions.4. The ld. CIT(A) found that the appellant had deposited most of the tax deducted at source with the Government within the stipulated time and with interest for any delays. The penalty was levied by the AO without establishing a lack of reasonable cause for the default.5. The Tribunal upheld the decision of the ld. CIT(A) citing relevant legal precedents and the provisions of sec.273B of the Act, which states that penalty shall not be imposed if a reasonable cause for the default is shown by the assessee.6. The Tribunal dismissed the appeal filed by the Revenue, affirming the deletion of the penalty by the ld. CIT(A) based on the facts and legal position discussed in the judgment.