https://www.taxtmi.com/caselaws?id=277324 Penalty for failure to deduct tax at source under section 271C of the Income-tax Act, 1961 is not automatic and can be avoided where the assessee proves reasonable cause under section 273B, including a bona fide belief that tax was not deductible. On the facts, the assessee did not deduct tax on payments to a non-banking financial institution, later accepted the related tax consequence, and began deducting tax thereafter. These circumstances were treated as sufficient reasonable cause, so the penalty was cancelled. en-us Mon, 29 Sep 2014 00:00:00 +0530 Sat, 01 Dec 2018 12:35:01 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=277324 Penalty for failure to deduct tax at source under section 271C of the Income-tax Act, 1961 is not automatic and can be avoided where the assessee proves reasonable cause under section 273B, including a bona fide belief that tax was not deductible. On the facts, the assessee did not deduct tax on payments to a non-banking financial institution, later accepted the related tax consequence, and began deducting tax thereafter. These circumstances were treated as sufficient reasonable cause, so the penalty was cancelled. Case-Laws Income Tax Mon, 29 Sep 2014 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=277324