Santur Infrastructure Pvt Ltd, New Delhi V. ACIT Range-77, New Delhi

ITA 6844/DEL/2019

• Counselvise Citation: [2019] 112 COUNSELVISE.COM (IT) 0632 (ITAT-DELHI)
• Duration Of Justice: 4 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-12-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: G
• Assessment Year: 2015-2016
• Appeal Filed On: 16-08-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S S RANA
• Assessee Lawyers: ASHISHA MITTAL
• Keywords: Bonafide belief; Question of law; Non-deduction of tax; Reasonable cause; TDS; Set aside
• Section: 271(1)(c); 273B; 133A; 194C; 201(1)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH G : NEW DELHI) BEFORE SHRI R.K. PANDA, ACCOUNTANT MEMBER AND SHRI KULDIP SINGH, JUDICIAL MEMBER ITA NO.6844/DEL./2019 (ASSESSMENT YEAR : 2015-16) M/S. SANTUR INFRASTRUCTURE PVT. LTD., VS. ACIT, RA NGE 77, 302, 3 RD FLOOR, BARAKHAMBA ROAD, NEW DELHI. CONNAUGHT PLACE, NEW DELHI 110 001. (PAN : AAKCS2063E) (APPELLANT) (RESPONDENT) ASSESSEE BY : MS. ASHISHA MITTAL, CA REVENUE BY : SHRI S.S. RANA, CIT DR DATE OF HEARING : 04.12.2019 DATE OF ORDER : 18.12.2019 O R D E R PER KULDIP SINGH, JUDICIAL MEMBER : APPELLANT, M/S. SANTUR INFRASTRUCTURE PVT. LIMITED (HEREINAFTER REFERRED TO AS THE ASSESSEE) BY FILI NG THE PRESENT APPEAL SOUGHT TO SET ASIDE THE IMPUGNED ORDER DATED 19.06.2019 PASSED BY COMMISSIONER OF INCOME-TAX (APPEALS) 31 , NEW DELHI AFFIRMING THE PENALTY ORDER DATED 11.01.2018 PASSED U/S 271(1)(C) OF THE INCOME-TAX ACT, 1961 (FOR SHORT THE ACT), QUA THE ASSESSMENT YEAR 2015-16 ON THE GROUNDS INTER ALIA T HAT :- ITA NO.6844/DEL./2014 2 1. UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE, THE PENALTY ORDER DT. 11.01.2018 PASSED U/S 271C OF THE INCOME TAX ACT,1961 BY THE LD. ASSESSING AUTHORITY AND UPHELD BY THE LD. F IRST APPELLATE AUTHORITY IS VOID AS IT IS BARRED BY LIMITATION AS PRESCRIBED U/S 275(1)(C) OF THE ACT AND THE SAME DESERVES TO BE QUASHED. 2. UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE, T HE PENALTY U/S 271C OF THE ACT LEVIED BY THE LD. ASSESSING AUTHORI TY ON THE APPELLANT IS INJUDICIOUS AND BAD AT LAW AS NO SUCH PAYMENT OF ED C HAS BEEN MADE BY THE APPELLANT COMPANY. 3. UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE, T HE LD. ASSESSING AUTHORITY HAS GROSSLY ERRED IN ARRIVING A T A FINDING THAT THE ASSESSEE HAS NOT YET COMPLIED WITH THE PROVISIONS F SECTION 194C ON PAYMENTS OF EDC TO HUDA AS THE SAME CAN NOT BE TERM ED AS PAYMENT TO CONTRACTORS. 4. WITHOUT PREJUDICE TO THE ABOVE AND UNDER THE FAC TS AND CIRCUMSTANCES OF THE CASE, THE LD. FIRST APPELLATE AUTHORITY HAS GROSSLY ERRED IN UPHOLDING THE PENALTY ORDER OF ID. ASSESSI NG AUTHORITY AS THE PENALTY U/S 271 C SHOULD NOT BE LEVIED IN ACCORDANC E TO THE PROVISIONS OF SECTION 273B OF THE INCOME TAX ACT, 1961 AS THE APPELLANT HAS PROVED THAT THERE WAS REASONABLE CAUSE FOR NON-DEDU CTION OF TAX AT SOURCE ON THE PAYMENT OF EXTERNAL DEVELOPMENT CHARG ES TO HUDA. 5. WITHOUT PREJUDICE TO THE ABOVE AND UNDER THE FAC TS AND CIRCUMSTANCES OF THE CASE, THE LD. ASSESSING AUTHOR ITY AS WELL AS THE LD. FIRST APPELLATE AUTHORITY HAS PASSED THEIR ORDERS W ITHOUT APPLICATION OF MIND THAT THE HARYANA URBAN DEVELOPMENT AUTHORITY ( HUDA) ITSELF IS A STATUTORY BODY SET UP UNDER HARYANA DEVELOPMENT AUT HORITY ACT, 1977 WHICH PAYS TAXES ON THEIR INCOMES INCLUDING ON THE EDC'S COLLECTED FROM VARIOUS DEVELOPERS. 6. WITHOUT PREJUDICE TO THE ABOVE AND UNDER THE FAC TS AND CIRCUMSTANCES OF THE CASE, THE LD. ASSESSING AUTHOR ITY HAS GROSSLY ERRED IN LEVYING PENALTY OF RS. 20,22,0001- U/S 271C OF T HE ACT ALLEGING THAT THE APPELLANT WAS LIABLE TO DEDUCT TAX AT SOURCE ON THE PAYMENT FOR EXTERNAL DEVELOPMENT CHARGES (EDC) AMOUNTING TO RS. 10,11,00,000/- MADE TO HARYANA URBAN DEVELOPMENT AUTHORITY (HUDA) WHICH IS HIGHLY INJUDICIOUS, UNWARRANTED, AGAINST THE FACTS OF THE CASE AND BAD AT LAW.' 2. BRIEFLY STATED THE FACTS NECESSARY FOR ADJUDICAT ION OF THE CONTROVERSY AT HAND ARE : ON THE BASIS OF INFORMATI ON COME ON RECORD DURING THE SURVEY PROCEEDINGS CONDUCTED UNDE R SECTION 133A OF THE ACT AT THE BUSINESS/OFFICE PREMISES OF HARYANA URBAN DEVELOPMENT AUTHORITY (HUDA), ASSESSING OFFICER (AO ) NOTICED ITA NO.6844/DEL./2014 3 THAT THE TAX DEDUCTED AT SOURCE (TDS) WAS NOT MADE ON PAYMENT OF EXTERNAL DEVELOPMENT CHARGES (EDC) AND CONSEQUEN TLY, INITIATED THE PENALTY PROCEEDINGS U/S 271C OF THE A CT. AO PROCEEDED TO HOLD THAT THE ASSESSEE WAS STATUTORILY BOUND TO DEDUCT TDS ON THE AMOUNT OF RS.10,11,00,000/- NOR BROUGHT ON RECORD ANY EVIDENCE IF THE NON-DEDUCTION/NON-DEPOSIT OF TAX AT SOURCE WAS BEYOND THE CONTROL OF THE ASSESSEE COMPANY, THUS AS SESSEE COMPANY HAS NO REASONABLE CAUSE WITHIN THE MEANING OF SECTION 273B OF THE ACT FOR NON-DEDUCTION OF TAX AT SOURCE AND CONSEQUENTLY, LEVIED THE PENALTY OF RS.20,22,000/- @ 2% OF THE EDC AMOUNT U/S 271C OF THE ACT. 3. ASSESSEE CARRIED THE MATTER BY WAY OF AN APPEAL BEFORE THE LD. CIT (A) WHO HAS CONFIRMED THE PENALTY LEVIED BY THE AO BY DISMISSING THE APPEAL. FEELING AGGRIEVED, THE ASSES SEE HAS COME UP BEFORE THE TRIBUNAL BY WAY OF FILING THE PRESENT AP PEAL. 4. WE HAVE HEARD THE LD. AUTHORIZED REPRESENTATIVES OF THE PARTIES TO THE APPEAL, GONE THROUGH THE DOCUMENTS R ELIED UPON AND ORDERS PASSED BY THE REVENUE AUTHORITIES BELOW IN T HE LIGHT OF THE FACTS AND CIRCUMSTANCES OF THE CASE. 5. UNDISPUTEDLY, DEMAND DRAFTS FOR PAYMENT OF EDC W ERE ISSUED IN THE NAME OF CHIEF ADMINISTRATOR, HUDA FOR AN AMOUNT OF RS.10,11,00,000/- FOR THE YEAR UNDER ASSESSMENT. IT IS ALSO NOT IN ITA NO.6844/DEL./2014 4 DISPUTE THAT HUDA HAS SHOWN EDC AS CURRENT LIABILIT Y IN THE BALANCE SHEET BUT, IN THE NOTICE OF ACCOUNTS FORMIN G PART OF THE BALANCE SHEET, IT HAS SHOWN THAT THE EDC HAS BEEN R ECEIVED FOR EXECUTION OF VARIOUS EXTERNAL DEVELOPMENT WORKS, AS AND WHEN THE DEVELOPMENT WORKS ARE CARRIED OUT THE EDC LIABILITI ES ARE REDUCED ACCORDINGLY. IT IS ALSO NOT IN DISPUTE THAT HUDA I S ENGAGED IN ACQUIRING LAND, DEVELOPING IT AND FINALLY HANDING O VER TO THE CUSTOMERS FOR A PRICE. IT IS ALSO NOT IN DISPUTE T HAT EDC ARE FIXED BY HUDA FROM TIME TO TIME BY ISSUING LETTERS/CIRCUL ARS. IT IS ALSO NOT IN DISPUTE THAT THE ASSESSEE HAS NOT CREDITED T HE AMOUNT OF EDC PAID TO SHRI VARDHMAN INFRA HEIGHTS PVT. LTD. IN IT S P&L ACCOUNT. IT IS ALSO NOT IN DISPUTE THAT AGREEMENT BETWEEN TH E LAND OWNERS INTENDED TO SET UP A GROUP HOUSING SOCIETY DATED 30 .11.2010 WAS ENTERED INTO BETWEEN M/S. DIAL SOFTECH PVT. LTD., S HRI TEK RAM, SMT. SAROJ SINGHAL, SMT. LUXMI DEVI AND SMT. SUNEHR A DEVI C/O M/S. SANTUR INFRASTRUCTURE PVT. LTD. AND THE GOVERN OR OF HARYANA ACTING THROUGH THE DIRECTOR, TOWN & COUNTRY PLANNIN G (DTCP), HARYANA, WHEREBY OWNER UNDERTAKES TO PAY PROPORTION ATE EDC AS PER RATE, SCHEDULE, TERMS AND CONDITIONS CONTAINED IN THE AGREEMENT. 6. WHEN WE EXAMINE THE QUESTION AS TO WHETHER TDS ON PAYMENT OF EDC TO HUDA WAS NOT TO BE DEDUCTED BY AS SESSEE ITA NO.6844/DEL./2014 5 BECAUSE LEVY IS MADE BY DTCP HAVING CONTROL OVER TH E EDC AND NOT HUDA AS CONTENDED BY THE LD. AR FOR THE ASSESSE E IN THE LIGHT OF THE AFORESAID UNDISPUTED FACTS, WE ARE OF THE CO NSIDERED VIEW THAT THE ASSESSEE HAS NO LIABILITY TO DEDUCT TDS IN RESPECT OF THE PAYMENT MADE TO A GOVERNMENT DEPARTMENT, DTCP IN TH IS CASE, U/S 196 OF THE ACT AS THE PAYMENT WAS MADE TO HUDA ON BEHALF OF DTCP ONLY. 7. IT IS THE CASE OF THE ASSESSEE THAT THE PAYMENT OF EDC HAS BEEN MADE FOR CARRYING OUT ANY WORK IN PURSUANCE OF THE CONTRACT ENTERED INTO BETWEEN ASSESSEE AND DTCP, WHICH IS A GOVERNMENT DEPARTMENT, AND NOT IN PURSUANCE OF ANY CONTRACT BE TWEEN THE ASSESSEE AND HUDA. THIS PROPOSITION MOOTED OUT BY ASSESSEE IS SUSTAINABLE BECAUSE PAYMENT OF EDC WERE MADE BY THE ASSESSEE NOT FOR CARRYING OUT ANY SPECIFIC WORK TO BE DONE B Y HUDA FOR AND ON BEHALF OF THE ASSESSEE RATHER DTCP, A GOVERNMENT DEPARTMENT OF HARYANA, LEVY THESE CHARGES FOR CARRYING OUT EXT ERNAL DEVELOPMENT FROM THE DEVELOPER AND ENGAGES THE SERV ICES OF THE HUDA FOR EXECUTION OF THE WORK. 8. ON THE OTHER HAND, LD. DR FOR THE REVENUE LAID E MPHASIS ON SECTION 194C OF THE ACT AND CONTENDED THAT HUDA IS NEITHER A GOVERNMENT DEPARTMENT NOT A LOCAL AUTHORITY, HENCE PAYMENT MADE TO IT IS SUBJECT TO DEDUCTION OF TDS U/S 194C OF THE ACT. ITA NO.6844/DEL./2014 6 9. WE ARE OF THE CONSIDERED VIEW THAT WHEN PAYMENT OF EDC HAS BEEN MADE BY THE ASSESSEE IN ACCORDANCE WITH LI CENCE GRANTED BY THE DTCP, THE PAYMENT MADE TO HUDA WAS NOT MADE IN PURSUANCE OF ANY WORK CONTRACT OR UNDER STATUTORY O BLIGATION MEANING THEREBY THAT WHEN THE ASSESSEE HAS NO PRIVI TY OF CONTRACT WITH HUDA RATHER THE ASSESSEE HAS PRIVITY OF CONTRA CT WITH DTCP, A GOVERNMENT DEPARTMENT OF HARYANA, AS PER AGREEMEN T (SUPRA) AND THE HUDA HAS MERELY RECEIVED THE PAYMENT FOR AN D ON BEHALF OF DTCP, THE ASSESSEE WAS NOT REQUIRED TO DEDUCT TH E TDS. 10. LD. DR FOR THE REVENUE BY RELYING UPON THE OFFI CE MEMORANDUM F.NO.370133/37/2017-TPL DATED 23.12.2017 ISSUED BY THE CENTRAL BOARD OF DIRECT TAXES (CBDT) CONTEND ED THAT THERE IS NO AMBIGUITY THAT HUDA IS A TAXPAYER ENTITY UNDE R THE INCOME- TAX ACT AND AS SUCH, TDS PROVISIONS WOULD BE APPLIC ABLE ON EDC PAYABLE BY DEVELOPER TO HUDA. 11. WHEN WE EXAMINE AFORESAID CONTENTION RAISED BY THE LD.DR FOR THE REVENUE IN THE LIGHT OF THE FACTS AND CIRCU MSTANCES OF THE CASE IN WHICH EDC HAVE BEEN PAID TO HUDA FOR FINANC IAL YEARS 2013-14, 2014-15, 2015-16 & 2016-17 (UPTO DECEMBER 2016) AS MENTIONED BY THE LD. CIT (A) IN PARA 2.1 OF HIS ORD ER, IT GOES TO PROVE THAT PRIOR TO 23.12.2017, THE DATE OF CBDT CI RCULAR, THERE WAS NO CLARITY WHATSOEVER AS TO THE DEDUCTION OF TA X ON EDC. ITA NO.6844/DEL./2014 7 WHEN THERE WAS NO CLARITY WITH THE ASSESSEE PRIOR T O 23.12.2017, IF TDS WAS TO BE DEDUCTED BY THE ASSESSEE ON PAYMENT O F EDC, IT PROVIDED A REASONABLE CAUSE U/S 273B OF THE ACT T HAT TDS WAS NOT REQUIRED TO BE DEDUCTED. 12. LD. AR FOR THE ASSESSEE CONTENDED THAT DTCP HAD ISSUED A CLARIFICATION DATED 29.06.2018 TO THE EFFECT THAT N O TDS WAS/IS REQUIRED TO BE DEDUCTED IN RESPECT OF PAYMENT OF ED C AND RELIED UPON THE ORDER PASSED BY THE COORDINATE BENCH OF TH E TRIBUNAL IN CASE OF RPS INFRASTRUCTURE LTD. VS. ACTI IN ITA NOS.5805, 5 806, 5349/DEL/2019 ORDER DATED 23.07.2019 WHEREIN IT IS HELD THAT, ON THE BASIS OF LETTER SUPRA ISSUED BY DTCP THAT THE L ETTER COVERS BOTH PAST AND FUTURE TRANSACTIONS AND TDS WAS NOT REQUIR ED TO BE DEDUCTED. WE HAVE PERUSED THE ORDER PASSED BY THE TRIBUNAL IN CASE OF RPS INFRASTRUCTURE LTD. (SUPRA) IN WHICH LETTER (SUPRA) HAS BEEN EXAMINED, IT IS CLEAR THAT TDS WAS/IS NOT REQU IRED TO BE DEDUCTED IN RESPECT OF DEDUCTION OF EDC. SO, IN VI EW OF THE MATTER, WE ARE OF THE CONSIDERED VIEW THAT WHEN DTC P, A DEPARTMENT OF GOVERNMENT OF HARYANA, HAS ITSELF CLA RIFIED NOT TO DEDUCT THE TDS, NO PENALTY IS LEVIABLE U/S 271C ON THE ASSESSEE. 13. EVEN OTHERWISE, FOR ARGUMENT SAKE, EVEN IF IT I S ASSUMED THAT TAX IS REQUIRED TO BE DEDUCTED ON EDC BUT NOT DEDUC TED UNDER ITA NO.6844/DEL./2014 8 BONAFIDE BELIEF THAT THE PROVISIONS CONTAINED U/S 2 71C ARE NOT ATTRACTED, NO PENALTY CAN BE LEVIED. 14. HONBLE SUPREME COURT IN THE CASE OF CIT VS. BANK OF NOVA SCOTIA 380 ITR 550 UPHELD THE FINDINGS RETURNED BY THE TRIBUNAL THAT, IF THERE IS NO CONTUMACIOUS CONDUCT OF THE ASSESSE E, PENALTY U/S 271C CANNOT BE LEVIED. OPERATIVE PART OF THE JUDGMENT SUPRA IS EXTRACTED FOR READY PERUSAL AS UNDER :- '2. THE MATTER WAS PURSUED BY THE REVENUE BEFORE TH E INCOME TAX APPELLATE TRIBUNAL. THE INCOME TAX APPEL LATE TRIBUNAL VIDE ORDER DATED 31.03.2006 ENTERED THE FO LLOWING FINDINGS: '11. WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISS IONS. IN THE INSTANT CASE WE ARE NOT DEALING WITH COLLECT ION OF TAX U/S 201(1) OR COMPENSATORY INTEREST U/S 201(1A) . THE CASE OF THE ASSESSEE IS THAT THESE AMOUNTS HAVE ALR EADY BEEN PAID SO AS TO END DISPUTE WITH REVENUE. IN THE PRESENT APPEALS WE ARE CONCERNED WITH LEVY OF PENAL TY U/S 271-C FOR WHICH IT IS NECESSARY TO ESTABLISH THAT T HERE WAS CONTUMACIOUS CONDUCT ON THE PART OF THE ASSESSEE. W E FIND THAT ON SIMILAR FACTS HON'BLE DELHI HIGH COURT HAVE DELETED LEVY OF PENALTY U/S 271-C IN THE CASE OF IT OCHU CORPORATION 268 ITR 172 (DEL) AND IN THE CASE OF CI T V. MITSUI & COMPANY LTD. 272 ITR 545. RESPECTFULLY FOLLOWING THE AFORESAID JUDGMENTS OF H ON'BLE DELHI HIGH COURT AND THE DECISION OF THE ITAT, DELH I IN THE CASE OF TELEVISION EIGHTEEN INDIA LTD., WE ALLO W THE ASSESSEE'S APPEAL AND CANCEL THE PENALTY AS LEVIED U/S 271C.' 3. BEING AGGRIEVED, THE REVENUE TOOK UP THE MATTER BEFORE THE HIGH COURT OF DELHI AGAINST THE ORDER OF THE IN COME TAX APPELLATE TRIBUNAL. THE HIGH COURT REJECTED THE APP EAL ONLY ON THE GROUND THAT NO SUBSTANTIAL QUESTION OF LAW ARIS ES IN THE MATTER. 4. ON FACTS, WE ARE CONVINCED THAT THERE IS NO SUB STANTIAL QUESTION OF LAW, THE FACTS AND LAW HAVING PROPERLY AND CORRECTLY BEEN ASSESSED AND APPROACHED BY THE COMMISSIONER OF INCOME ITA NO.6844/DEL./2014 9 TAX (APPEALS) AS WELL AS BY THE INCOME TAX APPELLAT E TRIBUNAL. THUS, WE SEE NO MERITS IN THE APPEAL AND IT IS ACCO RDINGLY DISMISSED.' 15. FURTHERMORE, COORDINATE BENCH OF THE TRIBUNAL I N CASE OF DCIT (TDS), ACIT (TDS) AND JCIT (TDS), DEHRADUN VS. THE JOINT SECRETARY ORGANIZING COMMITTEE FOR WINTER GAM ES ALSO DECIDED THE IDENTICAL ISSUE BY RELYING UPON THE DEC ISION RENDERED BY HONBLE SUPREME COURT IN CASE OF CIT VS. BANK OF NOVA SCOTIA (SUPRA) AND DELETED THE PENALTY U/S 271C BY RETURNI NG FOLLOWING FINDINGS :- '31. WE HAVE CAREFULLY CONSIDERED THE RIVAL CONTENT IONS AND PERUSED THE ORDERS OF THE LOWER AUTHORITIES. ON LOO KING TO THE FACTS OF THE CASE AS DISCUSSED BY US IN APPEAL OF T HE ASSESSEE AND REVENUE IN 201(1) AND 201(1A) PROCEEDINGS ABOVE, WE FIND THAT THE BELIEF OF THE ASSESSEE IS BONAFIDE AND FAILURE TO DEDUCT TAX AT SOURCE U/S 194C OF THE ACT IS FOR A REASONABLE CAUS E. THE LD ASSESSING OFFICER COULD NOT SHOW ANY CONTEMPTUOUS C ONDUCT ON PART OF THE ASSESSEE FOR NON-DEDUCTION OF TAX AT SO URCE. THERE COULD ALSO NOT BE ANY REASON FOR NON-DEDUCTION AS A SSESSEE HAS MADE MOST OF THE PAYMENTS TO THE PUBLIC SECTOR UNDE RTAKING. THE HON'BLE SUPREME COURT IN THE CASE OF CIT VS. BANK O F NOVA SCOTIA IN 380 ITR 550 HAS APPROVED THE DECISION OF THE HON'BLE DELHI HIGH COURT WHEREIN, IT HAS BEEN HELD THAT IT IS NECESSARY TO ESTABLISH 'CONTUMACIOUS CONDUCT' ON THE PART OF THE ASSESSEE FOR FAILURE TO DEDUCT TAX AT SOURCE FOR LEVY OF PENALTY U/S 271C OF THE ACT. IN THE PRESENT CASE, ALL THE RECIPIENTS HAVE A LSO FURNISHED A CERTIFICATE THAT THEY HAVE RECEIVED THE PAYMENT. IN VIEW OF THIS, WE REVERSE THE ORDER OF THE LD CIT (A) CONFIRMING T HE LEVY OF THE PENALTY OF 1152461/- U/S 271C OF THE ACT IN ABSENCE OF ANY FINDING TO SHOW CONTUMACIOUS CONDUCT ON THE PART OF THE ASSESSEE. LD OA ID DIRECTED TO DELETE THE PENALTY-L EVIED U/S 271C OF THE ACT. ACCORDINGLY, APPEAL OF THE ASSESSEE IN ITA NO. 1576/DEL/2015 FOR AY 2010-11 IS ALLOWED.' 16. IN VIEW OF WHAT HAS BEEN DISCUSSED ABOVE, WE AR E OF THE CONSIDERED VIEW THAT FIRSTLY, THE ASSESSEE WAS NOT REQUIRED TO DEDUCT TDS AS THE PAYMENT OF EDC WAS NOT MADE OUT OF ANY S TATUTORY AND ITA NO.6844/DEL./2014 10 CONTRACTUAL LIABILITY TO HUDA WITH WHOM THE ASSESSE E HAS NO PRIVITY OF CONTRACT; SECONDLY, THE ASSESSEE HAS REA SONABLE CAUSE FOR NON-DEDUCTION OF TAX AT SOURCE BY THE ASSESSEE COMP ANY; THIRDLY IT IS NOT THE CASE OF THE REVENUE AUTHORITIES THAT THE ASSESSEE HAS INTENTIONALLY AVOIDED THE DEDUCTION OF TDS BY BRING ING ON RECORD CONTUMACIOUS CONDUCT OF THE ASSESSEE; AND FOURTHLY, WITH CONTINUOUS CLARIFICATIONS BY THE CBDT AND DTCP DISC USSED IN THE PRECEDING PARAS, THE ISSUE BECAME DEBATABLE IF THE TDS IS TO BE DEDUCTED OR NOT ON THE EDC PROVIDING REASONABLE CAU SE TO THE ASSESSEE NOT TO DEDUCT THE TDS. CONSEQUENTLY, PENA LTY LEVIED BY THE AO AND CONFIRMED BY THE LD. CIT (A) IS NOT SUST AINABLE IN THE EYES OF LAW, HENCE ORDERED TO BE DELETED. SO, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN OPEN COURT ON THIS 18 TH DAY OF DECEMBER, 2019. SD/- SD/- (R.K. PANDA) (KULDIP SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED THE 18 TH DAY OF DECEMBER , 2019 TS COPY FORWARDED TO: 1.APPELLANT 2.RESPONDENT 3.CIT 4.CIT(A)-31, NEW DELHI. 5.CIT(ITAT), NEW DELHI. AR, ITAT NEW DELHI.