Assessment orders under Section 201 set aside for failing to consider submitted Forms 15G and 15H before issuing TDS notices

The HC set aside assessment orders passed under Section 201 regarding TDS liability on interest payments to citizens who submitted Forms 15G and 15H. While the petitioner failed to respond to show cause notices and attend personal hearings, the assessing officer did not consider earlier email submissions containing partial information. The court found that complete information was not collated before issuing notices, which should have been examined before passing orders. Rather than directing statutory appeal under Section 251, the court remitted the matter back to the respondent to pass fresh orders on merits within three months, considering all available information and following due process.

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Issues Involved:
The judgment involves challenging Assessment Orders passed under Section 201 of the Income Tax Act, 1961, based on Show Cause Notices issued to the petitioner for multiple Assessment Years regarding deduction of tax at source for depositors who submitted Form No.15G and Form No.15GH.

Details of the Judgment:

Challenge to Assessment Orders:
The petitioner, a Cooperative Bank, contested the Assessment Orders, claiming that interest paid to depositors did not exceed specified amounts, hence no tax deduction was required for depositors who submitted Form No.15G and Form No.15GH.

Non-Cooperation Allegation:
The respondent argued that the petitioner failed to participate in the proceedings despite being called for hearings, leading to the passing of the Assessment Orders.

Legal Provisions and Declarations:
Sections 197A(1A), 197A(1B), and 197A(1C) of the IT Act were cited, emphasizing the conditions under which no tax deduction should be made for certain individuals based on declarations provided.

Assessment Order Set Aside:
The Court set aside the Assessment Orders, directing the respondent to pass a fresh order within three months, emphasizing the need for cooperation from the petitioner and timely responses to Show Cause Notices.

Remittance and Compliance:
The petitioner was instructed to cooperate with the respondent, file a reply to the Show Cause Notices within thirty days, and ensure no further adjournments during personal hearings.

Conclusion:
The judgment quashed the Assessment Orders, requiring a fresh decision in compliance with the law, emphasizing cooperation from the petitioner and adherence to timelines for responses and hearings.

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