TaxTMI 
TaxTMI 
2016 (6) TMI 888
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....and these pertain to the same assessee, these were heard together and are being disposed off by this consolidated order for the sake of convenience. 2. The grounds raised in the appeals filed by the Revenue are identical in both the assessment years and they read as follows : "1. The Ld.CIT (A) has erred in holding that as no demand on account of non collection of tax at source has been raised by the AO, the action of the AO clearly establishes that the assessee is not in default as far as TCS is concerned. 2. The Ld.CIT (A) has erred in deleting penalty imposed u/s 271 CA r.w.s 274 of the I.T. Act, 1961 as he himself held that goods sold by the assessee are covered in the definition of 'Scrap' in the terms of t....
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....ions of section 206C of the Act. Further, it was submitted that the purchasers of scrap from assessee have duly paid the income-tax on such purchases and declared the same in their income-tax returns. Therefore, it was submitted that penalty cannot be levied under section 271CA of the Act. For the above provision, the assessee relied on the order of the Bangalore Bench of the Tribunal in the case of Wipro GE Medical Systems Ltd. (2005) 24CCH 1 (Bang Trib) dated 14.10.2013. 3.3) However, the JCIT(TDS) rejected the objection raised by the assessee and imposed the penalty amounting to Rs. 9,36,953/- for assessment year 2011-12 and Rs. 10,55,430/- for assessment year 2012-13. 4) Against the imposition of penalty under section 271CA of the....
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....ablishes that she has not treated the appellant as assessee in default as far TCS is concerned It is an accepted legal position that where the purchaser has paid the tax on his income, the revenue can only charge interest on the tax not so collected u/s 206(7) of the Act, till the filling of ITR by him. I have considered the case laws referred by the appellant and am of firm view that the judgment of Hon'ble Income Tax Appellate tribunal delivered in the case of WIPRO GE Medical Systems Ltd (2005) 24 CCH 0001 Bang Trib. is applicable. The relevant excerpt reads as under:- "8. Regarding penalty under s. 271C of the Act, it has been submitted on behalf of the assessee that sufficient compliance was made because the tax demand was....
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....e with the provisions of the Act and only when the buyer has not paid the tax then the authorities can proceed against the appellant, who was under obligation to collect tax at source and remit the same to Govt. account. Accordingly, I accept these grounds of appeal raised by the appellant and delete the penalty of Rs. 9,36,953/- imposed by the assessing officer." 4.1) Further, the CIT (Appeals) held that demand notice under section 156 of the Act has to be issued by the Officer who passed the penalty order and since it is issued by different officer, it is an incurable mistake. However, since the penalty has been quashed on other grounds, the CIT (Appeals) held that this plea of the assessee is of no consequence and disposed off the sam....
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.... recorded that no demand on account of non- deduction of tax at source has been raised by the Assessing Officer and only interest has been charged. It is , therefore, clearly established that Revenue Department has not treated the assessee as assessee in default as far as TCS is concerned. The ld. CIT ( Appeals) was, therefore, justified in following decision of Banglore Bench in the case of Wipro GE Medical Systems Ltd. in which the Tribunal has considered reasonable cause f or not levying the penalty when sufficient compliance was made because of the tax demand had already been paid. Since taxes have already been paid by the buyers and there was no tax demand remained. Therefore, ld. CIT( Appeals) correctly held that there was reasonable ....