Mere Non-Submission of E-TDS Statements just a Procedural Lapse, No Loss to Revenue caused: ITAT deletes Penalty [Read Order]

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The Income Tax Appellate Tribunal (ITAT), Pune Bench while deleting the penalty held that mere Non-Submission of E-TDS Statements is just a procedural lapse and no loss is caused to the revenue.

The assessee, Maharashtra Jeevan Pradhikaran being responsible for deduction of tax under the provisions of Chapter XVIIB of the Income Tax Act, 1961 was required to prepare and deliver or cause to be delivered to the prescribed Income Tax Authority, a quarterly statement under section 200(3) within such time and form as prescribed under Rule 31A of the Income Tax Rules. A notice under section 272A(2)(k) read with section 274 of the Act was issued to the deductor on October 1, 2012.

The Assessing Officer was of the opinion that in this case there was delay in delivering the copy of statement is 564 days, 472 days, 380 days, 452 days, 564 days, 472 days, 380 days and 260 days and the tax deductible relating to the statement in question is Rs.8,200/-, Rs.12,600/-, Rs.22,100/-, Rs.2,81,096/-, Rs.2,63,035/-, Rs.1,96,039/-, Rs.75,298/- and Rs.30,030/- respectively. Therefore, the Assessing Officer held that the assessee has committed a default in not delivering the E-TDS statements within the specified time without any reasonable cause and accordingly, levied a penalty of Rs.2,55,700/- under section 272A(2)(k) of the Act.

The CIT(Appeals) has confirmed the action of the Jt. Commissioner of Income Tax in levying penalty of Rs.2,55,700/- under section 272A(2)(k) of the Act.

The assessee submitted that due to frequent changes in the software, non-availability of PANs and lack of knowledge about electronic filing, there was delay in e-filing and the assessee had deducted and paid TDS along with interest. There was no default in tax deduction and payment to government account and the assessee did not derive any benefit from non –filing or late filing of E-TDS statements. There were genuine reasons to the assessee in submitting the return belatedly.

The coram of Inturi Rama Rao and Parthsarthy Choudhury held that since on filing belated returns/statements, Revenue had not suffered any loss because tax deducted was already deposited on time and there was mere technical or venial breach to provisions contained in Act for submitting return/statements of TDS. Therefore, penalty was not to be levied and the question was answered in favour of the assessee.

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