2016 (6) TMI 421

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....n and consolidated order is being passed. 3. The only grievance involved is the action of learned CIT(A) by which he had confirmed the penalty imposed by Assessing Officer u/s 271(C) of the Act. At the time of hearing the learned AR invited our attention to an additional ground of appeal which has been taken in all the appeals and which read as under: "That on the facts and circumstances of the case, penalty imposed u/s 271C of the Act is illegal and bad in law since assessee has not been held assessee in default u/s 201(1) of the Act. Penalty u/s 271C is consequential in nature for the default committed u/s 201(1) of the Act. Additional ground involving legal issues can be raised, keeping in view Judgment of the Apex Court in t....

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....cer and learned CIT(A) but it was not accepted by them. It was submitted that learned CIT(A) had not accepted the plea of assessee holding that the provisions were amended only on 1.07.2012 and the cases involved were prior to 1.07.2012. Continuing his arguments the learned AR invited our attention to an order of Chandigarh Tribunal dated 14.10.2015 in the case of H.P. State Electricity Board Vs. ACIT, in ITA No. 38 to 41/Chd/2015 and submitted that in that case the Hon'ble Bench had deleted the penalty holding that assessee was not declared as assessee in default and the Asst. Years involved were 2007-08 to 2010-11 which were also before 2012 and therefore, he prayed that the penalties be deleted as there was no order declaring the assesse....

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....T, in ITA Nos. 38 to 41 for Asst. Years 2007-08 to 2010-11 in its order dated 14.10.2015 under similar circumstances has deleted the penalty u/s 271(c) by holding as under. "11. In the present case, we find that the assessee has not been treated as an "assessee in default'' as per section 201 of the Act and is therefore neither liable to deduct nor pay any tax as per Chapter XVII B. In such circumstances, we find that the question of levy of penalty u/s 271C, does not arise. This view has been upheld by the Hon'ble ITAT Hyderabad in the case of ACIT Vs. M/s Good Health Plan Limited in MA No. 155/Hyd/2013, wherein penalty levied u/s 271C was deleted since the assessee was not held to be an assessee in default. The Hon'ble Tr....