INCOME TAX ACT, 196`

Sections 276B & 278B

Offences and prosecution - Delay in payment of TDS - Reasonable cause behind delay -

Assessee faced prosecution on account of non-deposit of TDS with the Central Government account within the time limit provided under the statute. Assessee was alleged to have committed the offences under section 276B and 278B. Assessee's case was that it deposited the TDS collected from different persons with the interest as per law within few months of respective collection and delay was ranging between 31 to 214 days which occassioned due to prevalence of Covid-19 Pandemic situation during financial year 2020-21. Unforseable and unavoidable situations emerged due to lockdowns / shutdowns imposed on the advent of the novel Corona-19 Pandemic. For the said measures imposed by the Central and State Government, all work places including their offices which remained closed. Due to which there was lack of a coordination amongst the staff dealing with matters and the staff worked from their house which caused the delay. Held: Failure on part of assessee to comply with provision of law as to deposit of deducted TDS was on account of the reasonable causes for the prevalence of COVID-19 Pandemic standing on their way. There was no willful attempt to delay or evade payment. Accordingly, no cognizance of the offence under section 279B, section 2(35) and 278(B) could not be taken and the complaint was thus vitiated.

REFERRED :

FAVOUR : In assessee's favour.

A.Y. :

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