TaxTMI 
TaxTMI 
2023 (7) TMI 1262
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....er of Income Tax Circle-3(2), Surat /Assessing Officer ('assessing officer' for short) u/s 271-I of the Income Tax Act, 1961 (hereinafter referred to as 'the Act') vide order dated 28.06.2019. 2. Grounds of appeal raised by Revenue are as follows: "1. Whether on the facts and circumstances of the case and in law, the Ld. CIT(A) has erred in not upholding the penalty imposed u/s 271-I of the I.T. Act of Rs. 70,00,000/-? 2. Whether on the facts and in circumstances of the case and in law, the Ld CIT(A) has erred in deleting the penalty u/s 271-I of Rs. 70,00,000/- by applying the Notification of the C.B.D.T. No. G.S.R.978(E) dated 16.12.2015 in spite of the fact that the said notification had come into effect only on 01.0....
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....5CA/15CB. The assessing officer found on the verification that the 70 payments had been made to a non-resident from 1.06.2015 to 31.03.2016, in which requisite Form No.15CA was required to be submitted before the assessing officer. Since the assessee failed to provide Form No.15CA/15CB, in 70 cases, therefore assessing officer held that the penalty provision u/s 271-I of the Act is applicable. The section 271-I of the Act was inserted w.e.f 01.06.2015, which mandates, that if the person failed to furnish such information before the assessing officer or furnishes inaccurate particulars, the assessing officer may levy a penalty of Rs. 10000/-. In response to the notice of the assessing officer, the assessee furnished its reply before the asse....
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....d the penalty. Aggrieved by the order of Ld. CIT(A) the Revenue is in appeal before us. 5. Learned Sr. Departmental Representative (Ld. Sr. DR) for the Revenue, argued that as per Section 195(6) of the Income Tax Act, 1961, the person responsible for paying to a non-resident, not being a company, or to a foreign company, any sum, whether or not chargeable under the provisions of this Act, shall furnish the information relating to payment of such sum, in such form and manner, as may be prescribed. This was substituted by the Finance Act, 2015 with effect from 01.06.2015. As per this amendment and considering the provisions of this Section, the assessee has to provide the Form No. 15CA before the assessing officer for each transaction. Whi....
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....made by the assessee was against the import of goods and does not attract the provision of withholding tax and therefore the requirement to furnish the details u/s 195(6) r.w. Rule 37BB is not mandatory. The Form 15CA/15CB are required to be submitted only for those payments which are chargeable to tax in India and therefore later on the Government amended the provision of section 195(6) of the Act by issuing notification no. G.S.R. 978(E) dated 16th December, 2015. Besides, there was conflict between section 195 and rule 37BB regarding the compliance of Form15CA, which was later on amended by the government by Notification No.G.S.R.978(E) dated 16th December, 2015. Therefore, penalty under section 271-I should not be levied for non-furnish....
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....S.R. 978(E) dated 16tth December, 2015. It was further submitted that Section 195 of the Income Tax Act, empowers the CBDT to capture information in respect of payment made to non-residents, whether chargeable to tax or not. On another side, Rule 37BB of the Income-tax Rules has been amended vide Notification No.G.S.R.978(E) dated 16th December, 2015, to strike a balance between reducing the burden of compliance and collection of information under section 195 of the Act. The significant changes under the amended Rules are as follows: • No Form 15CA and 15CB will be required to be furnished by an individual for remittance which do not require RBI approval under its Liberalized Remittance Scheme (LRS) • Further the l....
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....on no. G.S.R. 978(E) dated 16th December, 2015. The remittances which were made were against the import of goods and do not attract the provision of withholding tax and the requirement to furnish the details u/s 195(6) r.wRule 37BB is not mandatory. The Form 15CA/15CB are required to be submitted only for those payments which are chargeable to tax in India and do not require RBI approval under its Liberalized Remittance Scheme (LRS). 10. The ld CIT(A) also noted that the list of payments of specified nature mentioned in Rule 37BB, which do not require submission of Forms 15CA and 15CB, has been expanded from 28 to 33, including 'payments for imports'. Hence, apparently there was conflict between section 195 and rule 37BB regarding the co....