BIOCON LTD,BANGALORE vs. DEPUTY COMMISSIONER OF INCOME TAX, LTU, BANGALORE

ITA 1248/BANG/2014Status: DisposedITAT Bangalore21 March 2022AY 2012-1330 pages
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What did the Tribunal hold?

The Tribunal held that the disallowance of expenses under Section 40(a)(i)/40(a)(ia) does not absolve the assessee from the liability under Section 201. However, if TDS is deducted in the succeeding year when payments are made, the demand under Section 201(1) is liable to be cancelled, but interest under Section 201(1A) is still payable.

What were the facts?

The assessee, Biocon Ltd., failed to deduct tax at source (TDS) on certain year-end provisions for expenses. The Assessing Officer treated the assessee as an 'assessee in default' and raised demands for TDS and interest. The assessee argued that TDS was not applicable as the payees were not identifiable and the exact liability was uncertain.

What were the issues?

Whether the assessee can be treated as an 'assessee in default' for failure to deduct TDS on year-end provisions, and if so, whether the demand under Section 201(1) can be cancelled if TDS is deducted later.

Which sections of the Income-tax Act were involved?

Section 40(a)(i),Section 40(a)(ia),Section 201(1),Section 201(1A),Section 194C,Section 195,Section 194J,Section 194I,Section 194H

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Income Tax Appellate Tribunal, “A’’ BENCH: BANGALORE

Before: SHRI N.V. VASUDEVAN & SHRI B.R. BASKARAN

For Appellant: Shri Padamchand Khincha, A.R
For Respondent: Shri Sumer Singh Meena, D.R
Hearing: 28.02.2022Pronounced: 21.03.2022

PER B.R. BASKARAN, ACCOUNTANT MEMBER:

The assessee has filed this appeal challenging the order dated 25.7.2014 passed by Ld CIT(A), Large Taxpayers Unit, Bangalore and it relates to the assessment year 2012-13. The assessee is aggrieved by the decision of Ld CIT(A) in partially confirming the demand raised by the AO u/s 201(1) and interest charged u/s 201(1A) of the Act.

2.

The facts relating to the issue are stated in brief. The assessee is engaged in the business of manufacture and sale/licensing of active pharmaceutical ingredients and also trading in certain pharma Biocon Ltd., Bangalore formulations. The AO noticed

The order continues below.

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