Appeal Dismissed: ITAT Upholds Non-Leviability of Interest on Non-Resident Assessee u/s 234B of IT Act. The ITAT dismissed the department's appeal against the CIT(A)'s order, which ruled that interest under Section 234B of the IT Act was not leviable on the ...
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Appeal Dismissed: ITAT Upholds Non-Leviability of Interest on Non-Resident Assessee u/s 234B of IT Act.
The ITAT dismissed the department's appeal against the CIT(A)'s order, which ruled that interest under Section 234B of the IT Act was not leviable on the non-resident assessee. The ITAT upheld the CIT(A)'s decision, citing a precedent in the assessee's favor for a similar issue in a previous assessment year, where payments were subject to tax deduction under Section 195. The department failed to provide new evidence or arguments to challenge this precedent, resulting in the appeal's dismissal and the CIT(A)'s order being upheld.
Issues: Appeal against order on interest u/s 234B of IT Act.
Analysis: The appeal was filed by the department challenging the order of the ld. CIT(A) regarding the levy of interest u/s 234B of the IT Act, 1961. The main contention was that the interest was not leviable as payments made to the assessee were subject to tax deduction u/s 195 of the Act. The counsel for the assessee referred to a previous order in the assessee's own case for the assessment year 2010-11, where a similar issue was decided in favor of the assessee. The CIT DR supported the AO's order but failed to counter the argument put forth by the assessee's counsel.
The ITAT Delhi Bench 'F' had already adjudicated on an identical issue in the assessee's own case for the assessment year 2010-11. In that case, it was held that interest u/s 234B was not leviable on the non-resident assessee as they were subject to withholding tax u/s 195 of the Act. The ITAT found no infirmity in the CIT(A)'s decision and refused to interfere with it. Since the facts of the current year were the same as the previous assessment year, the ITAT decided to dismiss the department's appeal, following the precedent set in the earlier case.
Therefore, based on the previous decision and the lack of new evidence or arguments presented by the Revenue, the ITAT upheld the order of the CIT(A) and dismissed the department's appeal against the levy of interest u/s 234B of the IT Act for the current assessment year.
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