2008 (10) TMI 230

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.... was delivered by K. SREEDHAR RAO J.- The respondent (insurance company), pursuant to the award made under the Motor Vehicles Act, 1988, has paid compensation to the victim of motor vehicle accident. The award amount consisted of the compensation and interest liability. 2. The provisions of section 194A(3)(ix) mandates that when the respondent pays interest liability more than Rs. 50,000, it....

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....r is confirmed. The respondent is permitted under the order to split and spread over the interest liability for each of the assessment years. The Revenue aggrieved by the order of the Tribunal in denying the interest has filed the appeal. The respondent has not preferred any appeal against the order to the extent adverse to its interest. 5. In the above appeal, the following substantial questio....

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....mount since the said liability is in the nature of penalty. In this regard, the Tribunal relied upon the decision of this court in Mittal Steel Ltd. v. Asst. CIT [1999] 240 ITR 707. 7. In the Mittal Steel's case [1999] 240 ITR 707 (Karn), the proviso to section 201(1) was under consideration. The said proviso empowers the levy of penalty if the TDS deduction is not effected for any valid reason....

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.... is to be split and spread over the period from the date interest is directed to be paid till its payment. If the spread over is given in majority of cases the respondent may not incur liability to pay any TDS. In the event, the respondent remits TDS amount as directed by the Tribunal, the Revenue is directed to hold suo mottu enquiry by issuing notice to the persons who have received compensation....