INCOME TAX ACT 1961

Section 272A(2)(k)

Penalty under section 272A(2)(k) - Delay in filing TDS returns - Assessee incurred huge loss - Computation

Assessee deducted tax at source for the relevant assessment years. However, there was a delay in furnishing quarterly returns/statements. For the said contravention of provision of section 200(3), penalty under section 272A(2)(k) was imposed. Held: In the instant case, assessee was in acute shortage of money, as the real estate business was in recession and it had hit the cash flow of the assessee. Assessee incurred huge loss and these losses continued to pile up for the relevant financial years also. Due to this, assessee company could not pay TDS on time. The e-TDS statement under section 200(3) can only be filed after paying the taxes to the Central Government. Quarterly return of the TDS requires filling of date relating to payment of taxes. Therefore, such returns could be filed only after paying the tax to the Central Government account. Default in non-paying the taxes to the Central Government account in time or for non-deducting the tax at source, there are other provisions for ensuring compliance. Thus, AO was directed to levy penalty under section 272(2)(k) from the date of payment of TDS up to the date of filing of e-TDS statements, since e-TDS statement cannot be filed without payment of TDS to the credit of the Central Government account.

REFERRED :

FAVOUR : In assessee's favour.

A.Y. : 2010-11 & 2012-13

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