Tribunal rules in favor of assessee, removes interest for TDS delay due to technical glitches

The Tribunal allowed the appeals filed by the assessee, directing the Assessing Officer to delete the interest charged under section 201(1A) for delayed remittance of TDS due to technical glitches beyond the assessee's control. The Tribunal held that the assessee could not be penalized for the delay and that interest liability under section 220(2) was not applicable as the delay was not willful. Consequently, the interest charged for the delay in TDS remittance on two occasions was ordered to be deleted.

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Issues Involved:
The judgment involves the following Issues:
- Appeal against order of Commissioner of Income Tax (Appeals) regarding interest charged under section 201(1A) of the Income-tax Act, 1961 for delayed remittance of TDS.
- Whether the levy of interest under section 201(1A) was justified.
- Liability of the assessee for interest under section 220(2) for non-payment of the demand.

Details of Judgment:

Issue 1: Interest Charged under Section 201(1A) for Delayed TDS Remittance
The appeals in ITAs No.6899 to 6901/Del/2019 were filed against the order of the Commissioner of Income Tax (Appeals) regarding interest charged under section 201(1A) of the Act for delayed remittance of TDS by one day on two occasions. The appeals were related to quarterly returns filed in Form 24Q, Form 26Q, and Form 27Q for the 3rd quarter of the assessment year 2017-18.

Issue 2: Justification of Interest Levy under Section 201(1A)
The main issue in all appeals was whether the Commissioner of Income Tax (Appeals) was justified in confirming the levy of interest under section 201(1A) for the delayed remittance of TDS by one day on two occasions. The Tribunal found that the delay was due to technical glitches beyond the control of the assessee and held that the assessee could not be penalized for the delay. The Tribunal directed the Assessing Officer to delete the interest charged for the alleged default.

Issue 3: Liability for Interest under Section 220(2)
The Tribunal considered the argument that interest under section 220(2) would be liable on the assessee for not paying the demand raised. However, the Tribunal held that since the delay was not due to willful default by the assessee and was beyond their control, the interest liability under section 201(1A) could not be levied. Consequently, the Tribunal directed the Assessing Officer to delete the interest charged for the delay in TDS remittance for both instances.

Conclusion:
The Tribunal allowed the grounds raised by the assessee in all three appeals, concluding that there was no default committed by the assessee in remitting the TDS for the specified months. Therefore, all the appeals of the assessee were allowed, and the interest charged under section 201(1A) was directed to be deleted.

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