Binding interim judicial directions precluded TDS default liability on Leave Travel Concession reimbursements involving foreign travel.

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....Binding interim High Court directions treating Leave Travel Concession reimbursements as non-income for TDS purposes prevented bank branches from being treated as assessees in default for non-deduction on reimbursements involving foreign travel. Section 201 liability arises only where tax was not deducted despite a subsisting legal obligation. Compliance with operative interim directions eclipsed that obligation for the relevant period, even though employees remained liable if the writ petition failed. A subsequent merits decision on the exemption issue could not retrospectively impose default liability. Consequently, demands for default and related interest were set aside.....