PUNJAB NATIONAL BANK ,JALPAIGURI vs. ITO (TDS), WARD - 6(1), JALPAIGURI , JALPAIGURI

The assessee in this appeal has contested the action of the CIT(A) in sustaining the addition of Rs.50,930/- made by the Assessing Officer holding that the assessee as assessee in default u/s 201(1) of the Income Tax Act and thereby raising the demand u/s 201(1) and 201(1A) of the Income Tax Act on account of non-deduction of TDS on interest paid to one of its customers namely Shri Pradip Kumar Sarkar.

In appeal before the ld. CIT(A), the assessee furnished requisite Form no.15G/15H in respect of three customers and stated that the TDS was not required to be deducted in the case of the aforesaid three customers. However, in case of the fourth customer namely Shri Pradip Kumar Sarkar, the assessee could not produce the requisite form. The ld. CIT(A) considering the evidences furnished before him set aside the demand in respect of the three customers in whose case Form No.15G/15H were furnished before him. Since there was no explanation furnished in respect of the fourth customer, the ld. CIT(A) sustained the demand raised in that respect amounting to Rs.50,930/-.

Being aggrieved by the said order of the ld. CIT(A), the assessee has come in appeal before this Tribunal.

We have heard the rival contentions of both the ld. representatives of the parties. The ld. Counsel for the assessee-bank submitted that as per the provisions of section 201, if the assessee-bank is able to prove that the payee has taken into account the interest income paid by the assessee-bank to him for the purpose of furnishing of return of income and has paid due taxes, then in that event, the assessee will not be deemed to be an assessee in default. The ld. Counsel has further submitted that due to oversight and rush of work, the assessee could not produce the relevant evidences/documents in this respect before the A.O. The ld. Counsel has further submitted that the assessee may be given an opportunity to verify as to whether the payee has taken into account the interest income for Income-tax purposes and has paid due taxes on his income so disclosed. The Ld. Counsel for the assessee has further submitted that the matter may be restored to the file of Assessing Officer for fresh verification in this respect. The ld. DR has not objected to the same. In view of the above, for the sake of principle of natural justice, the matter be restored to the file of the Assessing Officer with a direction that the Assessing Officer will give proper opportunity to the assessee to furnish necessary evidences in this respect. The Assessing Officer will also consider the request of the assessee, if any, made in this respect to call for verification or to summon the payee for verification of the status of the interest income earned by him from the assessee as to whether