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HIGH COURT OF JUDICATURE FOR RAJASTHAN BENCH AT JAIPUR
MR. JUSTICE AVNEESH JHINGAN, MR. JUSTICE MANEESH SHARMA, JJ
Fortune Infovision Pvt Ltd – Appellant
Versus
Dy Commissioner Of Income Tax – Respondent
Order :
AVNEESH JHINGAN, J.
1. This writ petition is filed challenging order for sanctioning of prosecution proceedings for liability of Rs.79,893/-.
2. The brief facts of the case are that the petitioner No.1 for the assessment year 2014-15 was liable to deduct for Tax Deduction at Source (T.D.S.) from the payments made to the other companies and to deposit it. There was a delay in deposit of the T.D.S., but was deposited alongwith 18% interest after a delay upto ten months. The notice dated 23.02.2018 issued under Section 279(1) of the Income Tax Act, 1961 (for short ‘the Act of 1961’), was responded to the petitioner-company. It was stated that the business activity of the petitioner No.1 relates to e-commerce transactions and due to delay on the part of the companies like Amazon, Naaptol & Ebay etc. in submitting the bills by which T.D.S. to be deducted could be quantified.
2.1 The Commissioner, Income Tax (T.D.S.), Jaipur passed impugned order was granting sanction to prosecute petitioner No.1 and directors of company. Reliance was place upon the decision of the Supreme Court in the case of Madhumilan Syntex Ltd. & Ors. versus Union of India & Ors. reported in (2007) 11 SCC 297, t
Prosecution for delayed T.D.S. compliance is not warranted if the obligation is ultimately fulfilled, emphasizing that mere delay does not equate to malicious conduct.
The prosecution for delays in depositing TDS cannot proceed when the amounts were eventually paid with interest, and valid explanations for the delays were provided.
Prosecution for delayed TDS deposits under Income Tax Act may be quashed when reasonable causes are established; the recent CBDT circular allows for compounding such offences.
The main legal point established in the judgment is the importance of balancing the interests of both parties and considering legal submissions in prosecution proceedings under the Income Tax Act.
Prosecution for delayed TDS deposits during COVID-19 was deemed unwarranted as the pandemic constituted a 'reasonable cause' for non-compliance.
The main legal point established in the judgment is that the timing of TDS payment, the liability of the petitioners under Sections 276(B) and 278(B) of the Income Tax Act, and the interpretation of ....
The court affirmed that amendments to the Income Tax Act permit TDS deposit extensions up to the return filing date, emphasizing adherence to legislative intent in tax compliance cases.
The court affirmed the applicability of the Supreme Court's extension of limitation during the pandemic to compounding applications, asserting that discretion in such matters must be exercised judici....
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