1981 (4) TMI 119

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....appeals are against the levy of penalty under s. 221 for default in payment of the tax deducted at source from the salaries payable to the executives of the assessee-company. There is no dispute that the taxes deducted at source were not paid in time. The only plea taken up before us by the assessee is that the assessee was passing through great financial difficulties and, therefore, it would amou....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....ubsequently. When the Commissioner (Appeals) heard the matter, only about Rs. 24,000 was outstanding. Even that has been paid off now. Relying on the Supreme Court decision in Hindustan Steel, he submitted that mere default in payment is not sufficient for imposing penalty. It was also submitted that paucity of funds would amount to reasonable cause as held by the Madras High Court in (1980) 124 I....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....rded off if the assessee could show that the default was for good and sufficient reasons. The only reason now shown is financial difficulties which under these circumstances does not appear to be sufficient. It is no doubt true that a mere default is not sufficient for the levy of penalty. But as the Commr. (Appeals) had pointed out right from 1973 onwards the assessee had been a defaulter. And th....