LOTS SHIPPING LIMITED,KOCHI vs. JCIT TDS, KOCHI

O R D E R Per Bench These assessee’s twin appeals arise against orders of the National Faceless Appeal Centre , Delhi [CIT(A)] in proceedings u/s. 250 of the Income Tax Act, 1961 (the Act) as under : - DIN & Order No. Date No. 1 607/Coch/2023 2010-11 ITBA/NFAC/S/250/2023- 20.06.2023 24/1053815696(1) 2 812/Coch/2023 2007-07 ITBA/NFAC/S/250/2023- 20.06.2023 24/1053820732(1)

Cases called twice. None appears at assessee’s behest. We accordingly proceed exparte against the assessee.

& 608/Coch/2023 Lots Shipping Ltd. 2. Coming to the assessee’s identical sole substantive ground challenging section 271C penalties herein of Rs.8,39, 515/- and Rs.8,84,392/-; assessment year-wise, respectively, learned Sr. DR invited our attention to the CIT(A)/NFAC’s lower appellate detailed discussion upholding the same as under: - “5. DECISION: I have very carefully considered the facts of the case, grounds of appeal

, Penalty order passed by the JCIT (TDS) and the submissions of the assessee. 5.1 The assessee company is a deductor of TDS, During the the F.Y.2009-10, the assessee company had deposited the TDS made belatedly into the Government Account. Therefore, the JCIT(TDS) issued da ar notice u/s.274 r.w.s 271C of the Act on 20.12.2012 posting the case for hearing on 15.01.2013. On the date of hearing, the assessee filed reply to the aforesaid notice mainly pleading that the bills raised were not realized in time, the assessee changed accountants frequently and there was no intention to remit the TDS amount late. The reply of the assessee did not find favour with the AO. The AO was of the view that the assessee had committed similar default in earlier years starting from the F.Y.2008-09 to subsequent years including the F.Y.2012-13 when the amount of TDS had not been remitted even uptill 31.05.2013. The AO has also stated that the Penalty for F.Y.2008-09 was dropped considering the fact that it was the first year of default. The AO has relied on the Karnataka High Court decision in the case of CIT Vs. United Insurance Company. Ltd.(321 ITR 1) and the Union of India Vs. Dharmendra Textile Processors (306 ITR 277). The AO has further observed that the assessee has not been able to make out any case for reasonable cause u/s.273B of the Act. The AO has further relied on the Kerala High Court decision in the case of M/s U.S. Technologies International Pvt.Ltd. dated: 16.06.2009 while upholding the penalty order u/s 271C of the Act. The AO also observed that by not depositing the TDS amount in time into the Government Account, the assessee is unjustly depriving the deductees from getting credit for the tax deducted at source which warrants the levy of penalty u/s271C of the Act. The amount of TDS not remitted into the Government account during the year was Rs.8,39,515/- and therefore, after being satisfied, the AO levied the penalty of Rs.8,39,515/-u/s.271C of the Act for the F.Y.2009-10. 5.2 On the other hand it is the contention of the appellant as reproduced above. A perusal thereof reveals that the assessee has mainly pleaded that the bills raised were not realized in time, the assessee changed accountants frequently and there was no intention to remit the TDS amount late. I find that the assessee has not been able to explain the reasons for belated deposit and no case for reasonable cause has been made out either during the penalty proceedings before the JCIT or during the appellate proceedings. Therefore, I do not see any reason to interfere with a well reasoned and speaking order of the AO. Thus, the penalty of Rs.8,39,515/- levied u/s.271C of the Act for the F.Y.2010-11 by the AO is confirmed. Hence, the grounds of appeal are Dismissed.”

3. Suffice to say, the CIT(A) has adopted the very discussion in the latter assessment year 2011-12 as well. We note in this factual backdrop that the assessee & 608/Coch/2023 Lots Shipping Ltd. could not even plead and prove any reasonable cause within the meaning of section 273B of the Act explaining the delay in compliance of TDS provisions in question. Learned Sr. D.R. has further taken us to the CIT(A)’s detailed discussion in para 5.1 that this assessee has indeed be a habitual defaulter right from F.Y. 2008-09 onwards as well (supra).

4. Faced with this situation, we do not see any reason to interfere with the learned lower authorities findings levying the impugned section 271C penalty in both these assessment years. Ordered accordingly.