AI Drafter 
TaxTMI 
TaxTMI 
2023 (11) TMI 76
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....ncome Tax Act, 1961 (hereinafter referred to as Act) dated 24.03.2022 by the ld. Income Tax Officer, Ward-77(2), Delhi (hereinafter referred to as ld. AO). 2. The revenue has raised the following grounds of appeal before us:- 1. Whether on the facts and in the circumstances of the case and in law, the CIT(A) was justified in not appreciating the fact that the definition of contract provided u/s 194C is wide enough to cover EDC payments. EDC payments are in nature of contract u/s. 194C and therefore are required to be subjected to TDS accordingly. 2. Whether on the facts and in the circumstances of the case and in law, the CIT(A) was justified in not appreciating the fact that the cost of acquisition of land in paid by H....
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....e only effective issue involved herein is whether assessee could be treated as assessee in default u/s 201(1) of the Act and consequentially liable for interest u/s 201(1A) of the Act in respect of non deduction of tax at source on payment of external development charges (EDC) to Haryana Urban Development Authority (HUDA). The entire facts of the issue, observations of the ld AO, the submissions of the assessee and the observations of the ld CIT(A) are captured hereunder:- 4. I have considered the material on record including written submissions of the AR of the appellant filed in course of appellate proceedings. I have perused the order u/s 201(1) and 201(1A) of the Act. In the present appeal the appellant has raised eleven ground....
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....levied the interest for late payment/non-payment of TDS chargeable u/s. 201(1) of the Act @ 1% for every month on the amount of TDS in default from the date on which such tax was deducted to the date don which such tax is actually paid, the interest has been charged and payable by the appellant u/s. 201(1A) as follows: Amount of Payment (Rs.) Date of Payment TDS applicable u/s 194C and 194A (Rs.) TDS deducted Month of Default Interest Default u/s 201(1A) @ 1% p.m on the amount of TDS deductible (Rs.) 16,00,00,000/- 23.06.2014 32,00,000/- NIL 94 30,08,000/- 3,26,53,310/- 31.03.2015 32,65,331/- NIL 84 27,42,878/- Total 57,50,878/- 9. T....
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....wn in favour of the Chief Administrator, HUDA though routed through the Director General, Town and Country Planning, Sector-18 Chandigarh. He has also referred to the notes to accounts to the financial statements of HUDA wherein it has been stated that "other liabilities also include external development charges received through DGTCP, Department of Haryana for execution of various EDC works. The expenditure against which have been booked in Development Work in Progress, Enhancement compensation and Land cost." Undisputedly, the payment of EDC was issued in the name of Chief Administrator, HUDA. It is also not in dispute that HUDA has shown EDC as current liability in the balance sheet, but in the 'Notes' to the Accounts Forming par....
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....in ITA No.5713/Del/2019 vide order dated 11.09.2019. A similar view was also taken by the Coordinate Bench of ITAT Delhi in case of R.P.S Infrastructure Ltd. vs. ACIT in 5805, 5806 & 5349/Del/2019 vide order dated 23.07.2019. Therefore, on an identical facts and respectfully following the orders of the Co-ordinate Benches as aforesaid, we hold that the impugned penalty u/s 271C of the Act is not sustainable. The order of the Ld. CIT (A) is set aside and the penalty is directed to be deleted. 6.0 In the final result, the appeal of the assessee stands allowed." 13. Thus, it was held that the payment of EDC is not for carrying out any specific work to be done by HUDA for and on behalf of the appellant but rather Haryana Government whi....