TaxTMI 
TaxTMI 
2026 (2) TMI 492
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..../s 201 of Rs 3,88,408/- and interest liability u/s. 201(1A) of Rs 2,91,305/- and assessee-appellant prays full relief because (1). The ITO, TDS treated that assessee - appellant as default u/s 201/201(1A), without appreciating the fact that the assessee-appellant is a Charitable Society Registered u/s. 12A was under the bona fide belief that the provisions Chapter XVIII deduction of TDS is not applicable to a Registered Charitable Society due to non applicability of the section 40a(ia) disallowance of expenses on account of non deduction of Tds. (ii). The ITO. Tds treated that assessee - appellant as default u/s 201/201(1A), without ascertaining as to whether taxes had been deposited or not by recipient of income directly as per the mandatory provisions of Explanation to section 191. 3. That on the facts and circumstances of the case and in law, the CIT(A) erred in confirming the late fee charges u/s 234E of Rs. 4.01,527/- for the delay caused in furnishing TDS deduction statement without appreciating the fact that neither TDS was deducted nor TDS deduction statement u/s. 200(3) was filed, accordingly imposing late fee under the charging section 200A(1) c....
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....eletion of Rs. 3,88,408/- in full. (B). Additional legal jurisdictional grounds of appeal raised above by the assessee are purely legal in nature goes to the root of the matter can be taken as additional grounds at any stage including collateral proceedings and even before the Hon'ble ITAT for the 1st time and are emanating from the records available before the Tribunal. The legal grounds do not require any investigation and all materials are already on record before the Tribunal. (C). That no prejudice will cause to revenue by admitting these legal grounds, since, the revenue will be having a proper and reasonable opportunity of being heard on these issues. (D). That in the absence of admission of above grounds, the assessee may suffer irreparable loss. (E). It is therefore humbly prayed before your honour to admit and adjudicate the additional legal jurisdictional grounds of appeal raised above. Reliance in this regard is placed upon the decisions in the cases of "National Thermal Power Corporation vs. CIT (1998) 229 ITR 383 (SC)", "VMT Spinning Co. Ltd Vs. CIT (2016) 389 ITR 326 (P&H)", "Siksa O Anusadhan Vs. CIT (2011) 336 ITR 112) [Oriss....
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....re the CIT(A) without success. The aggrieved assessee is now before us. 7. First, we take up the additional grounds taken by the assessee that the AO has not followed the mandatory provisions of section 191 read with Explanation and not ascertained as to whether taxes had been deposited or not by recipient of income before considering the assessee as assessee in default. We find that the same goes to the root of the matter, hence the same is admitted. 8. At the very outset, the ld. counsel for the assessee submitted that for treating the assessee in default u/s. 201 of the Act, Explanation to Sec 191 [Direct Payment] cast duty upon the Assessing Officer to make an exercise regarding the failure of the Payee to deposit the tax directly to the Govt. A/C. Even though details of the 'Payees' name & PAN NO's. are available no exercise regarding direct deposit of tax specified in the 'Explanation to section 191 by the Payees was not done either by the Assessing Officer or by the CIT(A). The CIT(A) dismissed the same under the wrong application of law that the provisions of section 40(a)(ia) of the Act being disallowance of expenses due to non-deduction of TDS is app....
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....,- (a) who is required to deduct any sum in accordance with the provisions of this Act; or (b) referred to in sub-section (1A) of section 192, being an employer, does not deduct, or does not pay, or after so deducting fails to pay, the whole or any part of the tax, as required by or under this Act, then, such person, shall, without prejudice to any other consequences which he may incur, be deemed to be an assessee in default in respect of such tax: Provided that any person, including the principal officer of a company, who fails to deduct the whole or any part of the tax in accordance with the provisions of this Chapter on the sum paid to a resident or on the sum credited to the account of a resident shall not be deemed to be an assessee in default in respect of such tax if such resident- (i) has furnished his return of income under section 139; (ii) has taken into account such sum for computing income in such return of income; and (iii) has paid the tax due on the income declared by him in such return of income, and the person furnishes a certificate to this effect from an accountant in such form as may be prescribed17....