SANT TUKDOJI GRAMIN BIGAR SHETI SAHAKARI PATSANSTHA MARYADIT,NAGPUR vs. INCOME TAX OFFICER (TDS) WARD 2(4), BHANDARA

It emerges at the outset with the able assistance coming from both the parties that the assessee’s identical sole substantive grievance raised herein challenges learned lower authorities action treating it as the “assessee in default” for the purpose of recovering TDS and consequential interest thereupon in proceedings u/s.201(1) r.w.s. 201(1A) of the Act. Learned NFAC’s impugned lower appellate discussion affirming the assessment(s) findings to its effect reads as under :

Both the learned representatives reiterated their respective stands in support and against the assessee’s pleadings challenging the impugned TDS demands. The assessee has been pleading all along that once the corresponding collection agents bringing it the business of deposits, are not proved to have been assessed to tax for their respective taxable income(s), it could not be treated as the assessee in default for having not deducted TDS on the impugned commission payments in these three financial years. The Revenue could hardly dispute that the said assessee’s agents have denied their taxability by way of duly sworned in affidavits remains un-rebutted in the assessment findings or in the NFAC’s detailed discussion extracted hereinabove. That being the clinching fact emerging from the case files, we quote hon’ble apex court’s landmark decision in GE India Technology Cen. P. Ltd. Vs. CIT (2010) 327 ITR 456 (SC) that TDS provisions do not apply in absence of the income liable to be assessed in the concerned recipients’ hands. The assessee succeeds in these instant identical sole substantive grounds in very terms.

These assessee’s three appeals I.T.A.Nos.202, 203 & 204/NAG./2022 are accepted in foregoing terms. A copy of this common order be placed in the respective case files.