CIT vs. CJ INTERNATIONAL HOTELS LTD

ITA - 445 / 2011HC Delhi11 May 201128 pages
For Petitioner: K. SAWHNEY
AI SummaryPartly Allowed

What did the High Court hold?

The High Court held that while tips constitute income chargeable under 'salary', the assessees were not liable for non-deduction of TDS due to a bonafide belief for the periods in question. However, interest under Section 201(1A) is mandatory and cannot be waived.

What were the facts?

The assessees, hotel owners, collected tips paid by customers to their employees and distributed them. The Assessing Officers treated these tips as salary and held the assessees liable for non-deduction of TDS. The CIT(A) and ITAT ruled in favor of the assessees, stating tips were not salary and thus not subject to TDS.

What were the issues?

Whether tips collected and distributed by hotels to employees are considered 'salary' for TDS purposes, and if the employer can be treated as an assessee in default for non-deduction based on bonafide belief.

Which sections of the Income-tax Act were involved?

Section 192,Section 201(1),Section 201(1A),Section 15,Section 17

AI-generated summary — verify with the full judgment below

Cases cited in this judgment(7)Show list

Detected automatically from the text. Citations are also linked where they appear in the judgment. The count shows how many other judgments on BharatTax rely on the same authority.

* IN THE HIGH COURT OF DELHI AT NEW DELHI

+ ITAs No.475/2010, 476/2010, 860/2010

%

Reserved On: 23.03.2011 Date of Decision: 11.05.2011

The Commissioner of Income Tax – TDS …. APPELLANT Through: Ms.Rashmi Chopra, Sr. Standing Counsel

Versus

ITC Ltd. …. RESPONDENT Through: Mr.Ajay Vohra with Ms.Kavita Jha and Mr.Somhanth Shukla, Advcoates

AND + %

Reserved On: 23.03.2011 Date of Decision: 11.05.2011

The Commissioner of Income Tax – TDS …. APPELLANT Through: Ms.Prem Lata Bansal, Sr. Advocate with Mr.Deepak Anand, Jr. Standing Counsel.

Versus

C J International Hotels Ltd. …. RESPONDENT Through: Mr.M.S. Syali, Sr. Advocate with Ms.Madhavi Swaroop and Ms.Husnal Syali, Advocates

CORAM: HON'BLE MR. JUSTICE A.K. SIKRI HON’BLE MR. JUSTICE M.L. MEHTA 2011:DHC:2639-DB 1. Whether reporters of Local papers be allowed to see the judgment? Yes

2.

To be referred to the reporter or not?

Yes

3.

Whether the judgment should be repor

The order continues below.

Read the full judgment

A free account opens 10 full judgments a month. Re-reading one you have already opened does not count again.

Create a free accountSign in

See plans and prices

The summary, the parties, the sections and the citations above are open to everyone and always will be. Only the text of the order and the PDF are metered.

More judgments on Section 192

All 853 judgments and leading authorities on Section 192 →

Recent GST High Court judgments

Search GST case law →