TaxTMI 
TaxTMI 
2003 (8) TMI 198
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....and of the returns, statements, particulars mentioned in s. 206, interest under s. 201 & 201(1A) for various financial years. 2. The facts of the matter are that the ITO, TDS-7, Chennai initiated proceedings against the assessee under ss. 201(1) and 201(1A) for the various years 1997-98 to 1999-2000. The AO in his order had noted the reply made by the assessee. The reply stated that the company was passing through a very difficult period and it has been so for the last five years and consequently the staff strength has been reduced over the years. The financial position of the company became very weak and this led to the staff leaving the organisation without notice. The staff left the organisation carrying with them some of the papers a....
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....rest for these payments till asst. yr. 1982-83. No entry was posted in our books for the TDS amount payable for the asst. yr. 1988-89 and 1989-90. The party has filed a case against us and we are expecting that the loan will be settled by payment of the principal amount alone. Hence, we have written back the entire interest provided for them in asst. yr. 2001-02. In fact we have not provided for the interest amount payable for asst. yr. 2001-02 as mentioned in your letter. Hence, we request you to drop this, as no interest is ultimately payable to the party. We had submitted that TDS amount due on various payments. We observe that there is difference in the TDS calculations as compared to your statement. We are deputing our new Accounts ....
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....ement. Interest on borrowed amount of Rs. 50 lakhs from M/s Sterling Futures and Holdings Ltd. was provided in the accounts for the financial years 1998 to 2000. No TDS was deducted and no entry was made in the accounts in regard to TDS. Meanwhile the party had filed a suit against the assessee and proceedings were going on between them and the assessee expected that the party that had lent the amount to the assessee would agree to the principal amount and thereby waiving any interest that was due to it. The assessee could not pay the interest because it had no finance. Consequent to this the assessee had to write back interest in the financial year 2000-01. He submitted that the assessee........(sic) However, considering the fact that t....
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....essee has tried to show that the Department had considered payments to individuals with reference to the contract as through as covered by the provisions of s. 194C and thereby had treated the assessee as in default. Apparently reading of s. 194C clearly goes to show that the section does not apply to contracts that the assessee had with individuals. The assessee had placed before us the problems that it had because of its chief accountant leaving in between and staff also leaving them because they were not paid salaries and taking away with them various files and records further made their life miserable in culling out the information and judging so as to place it before the authorities. 5. In regard to the claim of the assessee that th....