2004 (8) TMI 14

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.... section 192 of the Income-tax Act, 1961. During the previous years relevant to the assessment years 1986-87, 1987-88, 1988-89, 1989-90 and 1990-91, the assessee deducted tax at source from the salary paid to the employees on regular basis. Subsequently, the Income-tax Officer noted that no tax had been deducted or paid on the salary advance paid to the employees. The Income-tax Officer (TDS), therefore passed two separate proceedings under section 201(1) dated January 16, 1992, and April 22, 1992, demanding Rs. 94,276 as the total tax deductible on the salary advance for 1986-87. The assessee paid the above sum of Rs. 94,276 for 1986-87 on March 10, 1992, and June 20, 1992. The appeal against the order under section 201(1) was dismissed by....

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....section 201(1A) was cancelled. The first appellate authority found that the assessee had deducted the tax from the salary of the employees on the salary income honestly estimated by it and had also paid the tax as required. Against the order passed by the Commissioner of Income-tax (Appeals), appeals were filed before the Tribunal. The Tribunal set aside the order passed by the appellate authority and restored the order passed by the Assessing Officer. It is against that these appeals are filed. We heard learned counsel for the appellant and learned counsel for the respondents. Learned counsel for the appellant submitted that the appellant had deducted the amount from the salary of all employees, who were assessable to tax. The appell....

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....tances mentioned, mandatory and there was no pre-condition of consideration of 'reasonable cause' for non-payment in time of tax deducted under section 192. Therefore, the Income-tax Officer was not required to take into consideration the 'reasonable cause' for non-payment of taxes deducted under section 192". In CIT v. Prem Nath Motors (Pvt.) Ltd. [2002] 253 ITR 705 (Delhi); [2001] 170 CTR 424 (Delhi), it was held as follows: "The levy of interest under section 201(1A) is of a compensatory measure for withholding tax which ought to have gone to the exchequer. The provision makes it clear that the levy is mandatory. It is true that the use of the expression 'shall' is not always determinative of the fact whether a provision is directory ....