CENTRAL SCIENTIFIC INSTRUMENTS ORGANIZATION CHD THR ITS DIRECTOR vs. COMMISSIONER OF INCOME TAX CENTRAL REVENUE BUILDING CHD

ITA/421/2015HC Punjab & HaryanaPHHC01110075201508 February 2016Author: MR. JUSTICE SURINDER GUPTA,MR. JUSTICE RAMESHWAR SINGH MALIK10 pages
AI SummaryDismissed

What were the facts?

The assessee, Central Scientific Instruments Organization, Chandigarh, filed appeals before the High Court of Punjab and Haryana against the order of the Income Tax Appellate Tribunal (ITAT). The assessment year in question is 2009-10. The appeals challenge the ITAT's order upholding the levy of penalty under Section 272A(2)(k) of the Income Tax Act, 1961. The penalty of ₹4,84,945 was imposed for technical default in filing TDS returns late. The assessee had deducted TDS from payments made under Section 194C and deposited the tax within time. However, the TDS returns in Form 26Q for the quarters ending June 30, 2008, September 30, 2008, December 31, 2008, and March 31, 2009, were filed on May 10, 2013, and May 13, 2013, respectively, which were significantly delayed. The Joint Commissioner levied the penalty, which was affirmed by the CIT(A) and subsequently by the ITAT.

What did the High Court hold?

The High Court held that the appeals lacked merit and no substantial question of law arose. The Court referred to Section 200(3) of the Act and Rule 31A(2) of the Rules, which mandate the filing of TDS statements within prescribed periods. The penalty under Section 272A(2)(k) is imposable for failure to deliver the statement within the specified time. The Court rejected the assessee's argument of 'no loss of revenue,' stating that the penal provisions were inserted to ensure compliance with filing TDS returns on time, not solely for revenue loss. The Court agreed with the CIT(A)'s observation that non-filing of statements can lead to loss of revenue for deductees, as their credit for TDS might not be reflected. The Court also noted that the delay in filing the TDS returns was nearly five years, and no plausible explanation was provided by the assessee, thus disentitling them to the benefit under Section 273B. The Court distinguished the cited judgments, stating they were based on individual facts and did not apply to the present case. Consequently, the penalty was rightly imposed.

What were the issues?

1. Whether the orders passed by the authorities below, including the ITAT, are legally sustainable in the facts and circumstances of the case? 2. Whether the ITAT was legally justified in upholding the penalty of ₹4,84,945 imposed under Section 272A(2)(k) of the Income Tax Act for the assessment year 2009-10, for technical default in filing TDS returns late, especially when the tax deducted was deposited in time and requisite forms were issued to the deductees? Assessee's Contentions: The assessee argued that the penalty was unwarranted. They referred to Section 200(3) of the Act and Rule 31A of the Income Tax Rules, 1962. The assessee contended that there was a reasonable cause for the delay in filing TDS returns under Section 273B of the Act, and since the TDS was deposited within time, there was no loss of revenue. They relied on judgments from the Punjab & Haryana High Court in *CIT (TDS) v. Executive Engineer* and *HMT Ltd. v. CIT*, and from the Rajasthan High Court in *CIT v. Deputy Housing Commissioner, Rajasthan Housing Board*, and the Allahabad High Court in *CIT v. Accounts Officer, Telecom*. Revenue's Contentions: The judgment does not explicitly record separate contentions for the revenue, but it addresses the revenue's position through the orders of the lower authorities.

Which sections of the Income-tax Act were involved?

Section 200(3),Section 272A(2)(k),Section 273B,Section 201,Section 201(1A),Section 194C,Section 206C,Section 274

AI-generated summary — verify with the full judgment below

ITA No. 421 of 2015 -1- IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH ITA No. 421 of 2015 (O&M) Date of Decision: 8.2.2016 Central Scientific Instruments Organization, Chandigarh ....Appellant. Versus Commissioner of Income Tax (TDS), Chandigarh and another ...Respondents.

1.

Whether the Reporters of the local papers may be allowed to see the judgment?

2.

To be referred to the Reporters or not? YES

3.

Whether the judgment should be reported in the Digest? CORAM:- HON'BLE MR. JUSTICE AJAY KUMAR MITTAL. HON'BLE MRS. JUSTICE RAJ RAHUL GARG. PRESENT: Mr. M.R. Sharma, Advocate for the appellant. AJAY KUMAR MITTAL, J.

1.

This order shall dispose of a bunch of three appeals bearing ITA Nos. 421, 423 and 424 of 2015 as according to learned counsel for the appellant, the issue involved is identical. For brevity, the facts are being extracted from ITA No. 421 of 2015. 2. ITA No. 421 of 2015 has been preferred by the assessee under Section 260A of the Income Tax Act, 1961 (in short “the Act”) against the order dated 30.4.2015 (Annexure A-3) passed by the Income Tax Appellate Tribunal, Chandigarh Bench “A”, Chandigarh (hereinafter GURBACHAN SINGH 2016.04.21 15:38 I att

The order continues below.

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