PARSVNATH DEVELOPERS LIMITED,DELHI V. JCIT, RANGE-76, NEW DELHI

ITA 2442/DEL/2024

AI Insights

The case involves Parsvnath Developers Limited appealing against the penalty levied under section 271C of the Income Tax Act, 1961 by the JCIT, Range-76, New Delhi, for the assessment years 2011-12. The penalties were imposed due to errors in the TDS returns filed by the company, which included not mentioning the PAN of payees, not citing lower tax deduction certificates, and applying incorrect tax deduction rates. The Commissioner of Income Tax (Appeals)-30 upheld the penalties, leading to the appeals before the Tribunal. The Tribunal, referencing a similar case for the assessment year 2012-13, found that the penalties were unjustified as the errors were minor and did not indicate any intent to evade tax.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 34645 (ITAT-DELHI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-01-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: F
• Assessment Year: 2014-2015
• Other Referred Cases: ITA No.1821/D/2022
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: HARPREET KAUR HANSRA
• Assessee Lawyers: PARITOSH JAIN
• Keywords: TDS

Judgement Text

"Page 1 of 7 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH ‘F’: NEW DELHI BEFORE, SHRI M. BALAGANESH, ACCOUNTANT MEMBER AND SHRI YOGESH KUMAR U.S., JUDICIAL MEMBER ITA No.2441/Del/2024 (ASSESSMENT YEAR 2011-12) Parsvnath Developers Limited Parsvnath Tower, Near Shahdara Metro Station, Shahdara, Delhi-110032 PAN No.AAACP0743J vs JCIT Range-76 New Delhi (Appellant) (Respondent) ITA No.2442/Del/2024 (ASSESSMENT YEAR 2011-12) Parsvnath Developers Limited Parsvnath Tower, Near Shahdara Metro Station, Shahdara, Delhi-110032 PAN No.AAACP0743J vs JCIT Range-76 New Delhi (Appellant) (Respondent) Appellant by Sh. Paritosh Jain, Advocate Respondent by Ms. Harpreet Kaur Hansra, Sr. DR Page 2 of 7 Date of Hearing 31/12/2024 Date of Pronouncement 08/01/2025 ORDER PER M. BALAGANESH, AM: These appeals of the Assessee are arises out of the order of the Commissioner of Income Tax (Appeals)-30, Delhi [hereinafter referred to as ‘CITA(A)’] in Ap. No.10508/2017-18 and Appeal No.10511/2017-18 for A.Y. 2010-11/2011-12 and 2013-14/2014- 15 dated 10.01.2024 against the order passed by JCIT, Range-76, New Delhi dated 26.02.2018 u/s 271C the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’). 2. At the outset, we find that there is a delay in filing of the appeals by the assessee by 67 days before us. Considering the reasons adduced in the delay condonation petition, in the interest of substantial justice, we are inclined to condone the delay and admit the appeals of the assessee for adjudication. 3. Identical issue is involved in both the appeals and hence they are taken up together and disposed of by this common order for the sake of convenience. Page 3 of 7 4. The only identical issue to be decided in these appeals is as to whether the learned CIT(A) was justified in confirming the levy of penalty u/s.271C of the Act for both the years in the facts and circumstances of the instant case. 5. We have heard the rival submissions and perused the relevant material available on record. It is not in dispute that the assessee company while filing its TDS returns on quarterly basis had made certain errors by either not mentioning the PAN of the payees; or not mentioning the lower tax deduction certificate obtained u/s.197 of the Act qua payments made to the certain payees ; or applying wrong rate of deduction of tax at source while making payments to certain payees because of either of one or whole of the aforesaid deficiencies. The assessee was treated as assessee in default and tax and interest was collected from the assessee u/s.201 and 201(1A) of the Act respectively. Penalty proceedings u/s.271C of the Act also stood initiated on the assessee. Accordingly, the learned AO passed consolidated order u/s. 271C of the Act dated 26.02.2018 for assessment years 2007-08 to 2013-14, 2015-16 and 2016-17. In the said consolidated penalty order u/s.271C of the Act, penalty was levied for various assessment years and for various Page 4 of 7 quarters wherever the aforesaid deficiencies / errors were committed by the assessee in the TDS returns. This levy of penalty for various assessment years for various quarters were confirmed by the learned CIT(A). 6. At the outset, we find that the deficiencies / errors committed by the assessee in the quarterly TDS returns were mere typographical errors and there is absolutely no contumacious conduct or malafide indent on the part of the assessee to defraud revenue. In any event, the learned AO was not justified in passing a single consolidated order for various assessment years for various quarters for leving penalty u/s. 271C of the Act. Such consolidated order passed for various assessment years itself make the order void abintio. Further we find that the issue in dispute was subject matter of adjudication by the coordinate Bench of this Tribunal in assessee’s own case for A.Y.2012-13 in ITA No.1821/D/2022 dated 18.12.2024 wherein it was held as under :- “9. We are of the considered view that the Id.CIT(A) has fallen in error in not appreciating the fact that it was not a case of no deduction, but, short deductions for which the assessee had explained that due to some errors committed by the Accountant, the discrepancies occurred leading to short deposits. Page 5 of 7 10. The Id. tax authorities below have been too rigid to expect an explanation overlooking the principles of human behavior, conduct and prudence. We are of the considered view that arithmetical and clerical mistakes are always likely to happen in accounting and reporting transactions to the Id. Tax authorities. No malice can be imputed on the basis that the mistake was a recurring one or that entity is a big corporate undertaking having very qualified personnel. The lack of competence or negligence of individuals performing duties of a corporate entity should be considered sufficient justification in case of short deductions. Ld. Tax authorities should have a realistic attitude to understand the ground realties. Provisions for advance tax deposits, TDS or TCS are mode of collecting taxes and the provisions in the Act concerning them should be liberally construed and certainly traces of malice should be visible from the facts to justify penalty for short deduction. Thus, we are of the considered view that the imposition of penalty was not justified. Accordingly, the grounds raised are allowed and the appeal of the assessee is allowed. Impugned levy of penalty is quashed.” 7. Respectfully, following the said decision, we have no hesitation to hold that levy of penalty u/s. 271C of the Act was not justified in the hands of the assessee for both the assessment years under consideration. Accordingly, the same are hereby directed to be cancelled. Page 6 of 7 8. In the result, both appeals of the assessee are allowed. Order pronounced in the open court on 08.01.2025 Sd/- Sd/- Sd (YOGESH KUMAR U.S.) (M. BALAGANESH) JUDICIAL MEMBER ACCOUNTANT MEMBER Dated:08/01/2025 Neha, Sr. P.S. Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI "