Penalty for Late TDS Certificates Overturned Due to Time-Barred Order and Justified Delay in Issuance.

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....Penalty u/s 272A(2)(g) was levied for not issuing TDS certificates in Form 16A to deductees on time. The issue pertained to the period of limitation for issuing the penalty notice. It was held that where the Assessing Officer initiates penalty proceedings in the assessment order, that date is the relevant date for reckoning limitation u/s 275(1)(c). In this case, the quantum proceedings were completed in December 2008, and the Assessing Officer initiated penalty proceedings then. Therefore, the last date for passing the penalty order was June 30, 2009. However, the penalty order was passed on September 29, 2009, beyond the prescribed time limit, rendering it barred by limitation. Additionally, on merits, the delay in issuing TDS certificates was linked to the delay in depositing TDS, for which the explanation was accepted. Consequently, the penalty u/s 272A(2)(g) was deleted.....