TaxTMI 
TaxTMI 
2021 (10) TMI 1054
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....A) erred in holding that provisions of section 201(3), as amended by Finance Act, 2014, are retrospective in nature and applies to the captioned assessment year. 1.3. The learned CIT(A) erred in not appreciating that for the purpose of the time limit mentioned in section 201(3), the date of filing the original TDS returns are relevant and not the correction statement. 1.4. The CIT(A) erred in not appreciating that section 201(3) refers to "statement‟ and no reference is made to "correction statement‟. Further, the learned DCIT had held the appellant to be "assessee‟ in default‟ on the basis that TDS is not deducted on LFC paid by referring to original statement and not correction statements. 1.5. The learned CIT(A) erred in making the following observations/ holding as under: "All the operational sections as per legal provisions will be applied de novo on this correction statement. Hence, for all purposes, the correction statement filed is as good as and equivalent to a statement filed u/s 200(3) of the Act. Once a correction statement is filed the inevitable effect is that, it partakes the character of statement ....
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....dia and he actually visits the place as designated. 2.2 LFC involving domestic travel by circuitous route 2.2.1. The learned CIT(A) erred in carrying out enhancement of assessment under section 251(1)(a) and holding the appellant as assessee in default in relation to claim of exemption of LFC paid to employees who have undertaken domestic travel. 2.2.2. The learned CIT(A) erred in holding that the appellant has submitted that out of the total domestic journey claim of Rs. 79,85,883, Rs. 52,79,750 is the amount of domestic journey claim where the circuitous journey is not performed by the shortest route. It is submitted that the amount of exemption provided to the employees under section 10(5) is after considering the shortest route to the designated destination. 2.2.3. The learned CIT(A) erred in not appreciating that the "shortest route‟ is a criterion to be taken into account for calculation of the maximum amount of exemption and not for the entitlement of exemption from income-tax itself. 3. Bona fide belief 3.1 The learned CIT(A) erred in not appreciating that the appellant was of the bona fide belief that it was not l....
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....Writ Petition (C) No. 2061 of 2014) (Delhi High Court. 5. Tata Teleservices v. Union of India (2016) 385 ITR 497 (Gujarat High Court). 6. Noida Power Company Ltd. v. CIT (Writ Tax No. 150 of 2016) (Allahabad High Court)." 7. Learned Departmental Representative, though, fairly submitted that the issue is covered by the decision of the Tribunal in assessee's own case. However, he submitted that the fact, whether the assessee has paid LFC for the shortest route is not forthcoming either from the orders of the AO or learned Commissioner (Appeals). Drawing our attention to statement of facts filed before learned Commissioner (Appeals), learned counsel for the assessee submitted that LFC was paid to the employees for the shortest route by the entitled class to the destination in India. 8. We have considered rival submissions and perused the materials on record. It is observed, identical dispute regarding non withholding of tax on LFC paid to employees came up for consideration before the coordinate Bench in assessee's own case in assessment years 2008-09 and 2012-13. While deciding the issue, the Tribunal has held as under:- "3. When these appeals were ta....
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.... "Judgment has, inter alia, observed that, "A duty is cast on an employer to form an opinion about the tax liability of his employee in respect of the salary income. While forming this opinion, the employer is undoubtedly expected to act honestly and fairly. But if it is found that the estimate made by the employer is incorrect, this fact alone, without anything more, would not inevitably lead to the inference that the employer has not accepted honestly and fairly. Unless that inference can be reasonably raised against an employer, no fault can be found with him. It cannot be held that he has not deducted tax on the estimated income of the employee". We humbly bow to the law so laid down by Their Lordships, and this, in our humble understanding, the correct and applicable legal position consistently followed by several coordinate benches of this Tribunal. There is not even a whisper of dissent on this point. It is in this light that we have, therefore, proceed further. The question that we need to, therefore, address is whether the action of the employer in not deducting tax at source from the leave travel facility in question could be said to be reasonable or bonafide. Let us, in ....
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....nditioned first class rail fare by the shortest route to the place of destination; and (iii) where the places of origin of journey and destination or part thereof are not connected by rail and the journey is performed on or after the Ist day of October, 1997, between such places, the amount eligible for exemption shall be:- (A) where a recognised public transport system exists, an amount not exceeding the Ist class or deluxe class farc, as the case may be, on such transport by the shortest route to the place of destination; and (B) where no recognised public transport system exists, an amount equivalent to the air-conditioned first class rail fare, for the distance of the journey by the shortest route, as if the journey had been performed by rail. (remaining Statutory provision not reproduced as it is not considered to be relevant for the present discussion) 8. A plain reading of the above provisions does not indicate any requirement of taking the shortest route for travelling to "any place in India" or putting any kind of restrictions the route to be adopted for going to such a destination. Quite to the contrary, the statutory provision....
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....uation, the exemption under section 10(5) is available to the employee though to the extent of farthest Indian destination by the shortest route, and that is what the assessee employer has allowed. In the light of this analysis of the legal position and the factual backdrop, whatever may be the position with respect of taxability of such a leave travel concession in the hands of the employee, the assessee employer cannot be faulted for mot deducting tax at source from the leave travel concession facility allowed by him to the employees. As we hold so, we may add that we have not really addressed ourselves to the larger question with respect to the actual taxability of this leave travel concession in the hands of the employees concerned, even though we have our prima facie reservations on the coordinate benches decisions holding taxability of these amounts in the hands of the employees concerned, because that aspect of the matter is not really relevant as on now. We leave it at that for the time being. The coordinate bench decisions deal with only the issue of taxability of leave travel facility under section 10(5) and not with the broader question about the nature of tax deduction ....