INCOME TAX ACT, 1961

Penalty under section 272A(2) - Leviability -Failure to deduct TDS

Held: If the tax is deducted at source by the person concerned and he commits default in complying with any of the provisions of section 203 or 206 but in case no tax is deducted at source, the aforesaid provisions would not be attracted. For failure of the assessee in deducting the tax at source, penalty can be imposed upon him under section 271C. Once a person prescribed or concerned or the assessee has been subjected to a penalty under section 271C, for not deducting the tax at source, there would not arise any occasion for levying a penalty under section 272A(2)(a ) and 272A(2)(g) for non-compliance of the provisions of sections 203 and 206. In other words, in case the tax has not been deducted at source, the question of issuing the certificate of tax under section 203 or that of filing of return under section 206 would not arise at all. That being so, the question of imposing penalty for violation of the aforesaid provisions, would also not arise

Income-tax Act, 1961, Section 272A

A.Y. :1994-95 and 1995-96
Decision: In favour of assessee.

Commissioner of Income Tax , Lucknow v. Sri Ram Memorial Education Promotion Society