TaxTMI 
TaxTMI 
2018 (10) TMI 1404
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....(A) also erred in confirming the same, which is completely contrary to the provisions of law and facts hence, kindly be quashed and deleted in full. 4. Rs. 41,914/-: The ld. ITO (TDS), Kota erred in law as well as on the facts of the case in raising demand of the alleged non deduction of TDS u/s 201(1) of the Act and the ld. CIT (A) also erred in confirming the same, which is completely contrary to the provisions of law and facts hence, kindly be quashed and deleted in full. 5. The ld. ITO (TDS), Kota, Jaipur also erred in law as well as on the facts of the case in initiating and referring penalty proceedings u/s 271C of the Act on account of the alleged non deduction of TDS in respect of the subjected receipts referred to in the impugned order dated 27.03.2014. The appellant not being liable to TDS and not being covered by the provisions of Sec. 194J of the Act, the very initiation and reference of the penalty proceedings is void ab intio, lacking jurisdiction and hence, such action, initiation and reference kindly be quashed here itself. 6. The appellant prays your honour indulgences to add, amend or alter of or any of the grounds of the appeal on or be....
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.... assessee has submitted that the AO has passed the impugned order under section 201(1)/201(1A) on 27.03.204 which is after 4 years from the end of the financial year under consideration, therefore, the order passed by the AO is barred by limitation which cannot be more than 2 years or at the maximum 4 years from the end of the financial year. The ld. A/R has further contended that at the relevant point of time, there was no limitation provided under section 201(1) of the Act and thereafter the limitation was provided by the amendment in the provisions by Finance Act, 2009 with effect from 01.04.2010 of 2 years from the end of the financial year in case where the assessee has filed the TDS statements. The limitation for passing the order under section 201(1) is 4 years in case where the assessee has not filed the TDS statements. Thus the ld. A/R has submitted that even if the amended provisions of the Act are considered, the order passed by the AO on 27.03.2014 is beyond 4 years from the end of the financial year under consideration. In support of his contention, he has relied upon the decision of Coordinate Bench of the Tribunal in case of ITO vs. Eid Mohammed Nizamuddin in ITA No.....
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....ted powers and authorities to the taxing authority. The law is to be followed by the authorities concerned as well as the persons governed by the said law and therefore, in absence of the limitation on the powers of the taxing authority, it would allow the misuse of such powers and provisions of the Act. It is pertinent to note that when a limitation is not provided in statute for a specific purpose then the limitation provided for the purpose of completing the assessment would be a proper guidance for taking the reasonable time period within which an order has to be passed by the taxing authority. An identical situation was prevailing in respect of the order passed U/s 201(1)(201(1A) of the Act prior to the amendment vide Finance Act, 2009 w.e.f. 01/4/2010 whereby subsection (3) was inserted to Section 201 of the Act and limitation has been provided for passing the order U/s 201(1) and 201(1A) of the Act. When this issue of limitation for passing the order U/s 201(1)/201(1A) of the Act came before the Courts, it was held that the Assessing Officer cannot be given unfettered powers which can be exercises even beyond a reasonable time because of non-providing the limitation in the s....
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....ducted and it came to be known only then that when the assessee had not deducted tax at source on the global salary. We are of the opinion that the date of knowledge is not relevant for the purposes of exercising jurisdiction insofar as the provisions of the Income-tax Act are concerned. If it were so, the limitation period, as for example prescribed under section 147/148 of the Act would become meaningless if the concept of knowledge is imported into the scheme of the Act. 23. The second part of the argument of learned counsel for the revenue in this regard was that the question of limitation did not at all arise because the assessee had itself admitted its liability and it voluntarily paid the tax and interest on that amount. Again, we are not in agreement with learned counsel for the revenue in this regard. 24. It appears that the assessee paid the tax voluntarily as well as interest thereon but the acceptance of the liability by the assessee would not by itself extend the period of limitation nor would it extend the reasonable time that is postulated by the scheme of the Incometax Act. The assessee cannot be put, in a sense, in a worse position merely because ....
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....ra). The Hon'ble Gujarat High Court in the case of Tata Teleservices Vs. Union of India & Anr. (supra) has held in paras 15 and 16 as under: "15. Considering the law laid down by the Hon'ble Supreme Court in the aforesaid decisions, to the facts of the case on hand and more particularly considering the fact that while amending section 201 by Finance Act, 2014, it has been specifically mentioned that the same shall be applicable w.e.f. 1/10/2014 and even considering the fact that proceedings for F.Y. 2007-08 and 2008-09 had become time barred and/or for the aforesaid financial years, limitation under section 201(3)(i) of the Act had already expired on 31/3/2011 and 31/3/2012, respectively, much prior to the amendment in section 201 as amended by Finance Act, 2014 and therefore, as such a right has been accrued in favour of the assessee and considering the fact that wherever legislature wanted to give retrospective effect so specifically provided while amending section 201(3) (ii) of the Act as was amended by Finance Act, 2012 with retrospective effect from 1/4/2010, it is to be held that section 201(3), as amended by Finance Act No.2 of 2014 shall not be applicable retr....
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....he can exercise even beyond the reasonable period of four years. Therefore, in our view, period of four years is just and proper and the Tribunal has not committed any error while passing the impugned order. Therefore, all these appeals are dismissed. The questions posed for our consideration are answered in favour of the assessee and against the revenue." Thus, four years time period was considered as reasonable period for passing the order U/s 201(1)/201(1A) of the Act. We find that the similar view has been taken by the Hon'ble Andhra Pradesh High Court in the case of CIT Vs. U.B. Electronics Instruments Ltd. (2015) 371 ITR 314 (AP) as well as by the Hon'ble Kerala High Court in the case of CIT(TDS) & Anr. Vs Bharat Hotels Limited (2016) 384 ITR 77 (Karn.). The Hon'ble Karnataka High Court has dealt this issue in para 23 to 27 as under: "23. In the memorandum explaining the provisions in the Finance (II) Bill, 2009, it was clearly stated that 'to provide sufficient time for pending cases, it is proposed to provide that such proceedings for a financial year beginning from 1st April, 2007 and earlier years can be completed by the 31st March, 2011. As such, th....
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....ount of such tax from the date on which such tax was deductible to the date on which such tax is actually paid and such interest shall be paid before furnishing the statement in accordance with the provisions of sub-section (3) of Section 200." The said sub-section clearly provides that interest would be payable from the date on which such tax was deductible, i.e., the date when payment was made by the assessee to the Recipient; till the date on which such tax was actually paid, i.e., tax was deposited by the Recipient. 27. The provision for tax deduction at source is only a mechanism for collection of tax by the payer, even though the liability to pay tax is that of the Recipient. The provision for payment of interest under subsection (1A) of Section 201 of the Act is only of compensatory nature. It cannot be a means to penalise the payer. The provision for payment of interest would arise from the date when it ought to have been deducted i.e., from the date of payment by the payer to the Recipient. The liability to pay interest would end on the date when such tax has been deposited by the Recipient, either by way of advance tax or along with the return of income.....