2026 (8) TMI 1260

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....nt order dated 14.02.2024 passed u/s 201(1) & 201(1A) of the Act pertaining to Assessment Year 2017-18. 2. Brief facts of the case are that the assessee was held as the assessee in default u/s 201(1) and 201(1A) of the Act for not deducting tax at source on the Leave Fare Concession ("LFC") paid to one of the employee namely, Shri Pramod Kumar Gupta of INR 4,50,000/- during the year under appeal. The payments were made for LFC where employee has undertaken travel including with the foreign visit. The AO in terms of the order of Hon'ble Supreme Court passed in assessee's own case in SBI vs ACIT (CA) No.8181 of 2022 dated 04.11.2022 reported in 144 taxmann.com 131 (SC) it was held that TDS u/s 192(1) of the Act should be made on the LFC pa....

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....ench of Tribunal has held that the assessee could not treated as the assessee in default for non-deduction of tax at source on LFC payment as the payment was made during the period when Hon'ble Madras High Court has passed the interim order restricting the assessee for not making any TDS on such payments. The relevant extracts of the observations made in para 3 & 4 of the order are reproduced as under:- 3. "From the facts, it is quite clear that the impugned LFC payments involving foreign LFC are not exempted u/s 10(5) as per the final decision of Hon'ble Apex Court in assessee's own case (supra). It has been held by Hon'ble Court that the when the assessee-bank claimed exemption towards leave travel concession (LTC) granted to its....

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....: - "6. The interim order granted by this court is explained to the effect that any amount paid to the petitioner towards LTC or reimbursement of LTC pursuant to the impugned order would not amount to the income so as to enable the bank to deduct tax at source. It is made clear that if the writ petition is dismissed, the employees are liable to pay tax on the amount paid by the bank." The Hon'ble Court thus restrained the assessee bank not to deduct tax at source on such reimbursement. Finally, the decision has been rendered by Hon'ble High Court of Madras in case titled as All India State Bank Officers Association vs. SBI (140 Taxmann.com 221; dt. 14-06-2022) holding that withdrawal of additional facility would not infrin....