INCOME TAX ACT, 1961

Section 201(1A)

Interest under section 201(1A) - Assessee deducted tax and deposited to government - Date of presentation of cheque before authorized banker -

Assessee deducted tax at source and deposited the same to the credit of the Government of India. Assessee remitted tax on 30-4-2018 and the sum was duly debited in the bank account of assessee on that date. However, in the tax challans issued by Bank the date of payment was shown as 2-5-2018. Since the date of remittance was 2-5-2018, AO charged interest under section 201(1)(1A). Assessee had filed a Paper Book in which he had given the dates of deposits of TDS as per the bank statement. AO was of the view that it was only the payment as shown in OLTAS that will be considered and therefore, assessee was liable to pay interest under section 201(1)(1A). Held: Tribunal concluded that when the cheques were presented and deposited before the authorized banker within the due date for payment of advance tax and when cheques are encashed and the amounts were realised subsequently, the date of payment should be taken as date of presentation of the cheques and AO was directed to take the date of presentation of the cheques before the authorized banker for payment of advance tax as date of payment. Central Government Account (Receipts and Payments) Rules, 1983 do not apply to payments but are applicable to payments made by cheques and the date of payment when payments are made by Cheques. Therefore, following the decision in case of P.L. Haulwel Trailers Ltd. v. DCIT (2006) 100 ITD 485 (Chennai) : 2006 TaxPub(DT) 1236 (Chen-Trib), levy of interest under section 201(1A) on assessee cannot be justified.

Followed:P.L. Haulwel Trailers Ltd. v. DCIT (2006) 100 ITD 485 (Chennai) : 2006 TaxPub(DT) 1236 (Chen-Trib)

REFERRED :

FAVOUR : In assessee's favour

A.Y. : 2018-19

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