Tribunal remits case to Assessing Officer for verification; appeal allowed for statistical purposes.

The Tribunal remitted the case back to the Assessing Officer for thorough verification of various aspects, including the functionality of online verification tools, submission of Form 26A, payees' tax payments, and compliance with Section 201(1) proviso. The appellant was granted a reasonable opportunity to present evidence and arguments. Ultimately, the Tribunal allowed the appeal for statistical purposes, emphasizing the need for proper verification and compliance before determining the appellant's default status and interest liability.

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Issues Involved:
1. Demand upheld by CIT(A) - Rs. 40,55,630
2. Legality of intimation under Section 154 and Section 200A
3. Demand raised due to processing of tax deduction statement under Section 200A
4. Violation of natural justice in issuing intimation under Section 154
5. Cancellation of certificates under Section 197 and principles of natural justice
6. Non-functional online verification facility for tax deduction certificates
7. Assessee's default status under Section 201(1)
8. Verification of payees' tax payments before raising demand
9. Non-compliance with Section 201(1) proviso and Form 26A submission
10. Levy of interest under Section 201(1A) for alleged short-deduction

Analysis:
1. The appeal challenged the CIT(A)'s decision upholding a demand of Rs. 40,55,630 against the appellant. The appellant argued that the intimation under Section 154 and Section 200A was legally flawed, as it did not arise from an arithmetical error or incorrect claim apparent from the statement.

2. The appellant contended that the intimation issued by the Assessing Officer (AO) violated Section 154(3) and principles of natural justice by not providing an opportunity to show cause. Additionally, the cancellation of certificates under Section 197 was deemed unjust and against natural justice.

3. The non-functional online verification facility for tax deduction certificates was highlighted as a factor contributing to the appellant's non-compliance. The appellant argued that without proper verification tools, they could not be considered in default under Section 201(1).

4. The appellant raised concerns regarding the CIT(A)'s failure to verify payees' tax payments before raising the demand. It was argued that without this verification, interest liability under Section 201(1A) could not be justified.

5. The Tribunal remitted the case back to the Assessing Officer for thorough verification of various aspects, including the functionality of online verification tools, submission of Form 26A, payees' tax payments, and compliance with Section 201(1) proviso. The appellant was granted a reasonable opportunity to present evidence and arguments.

6. Ultimately, the Tribunal allowed the appeal for statistical purposes, emphasizing the need for proper verification and compliance before determining the appellant's default status and interest liability.

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