J U D G M E N T

MANMEET PRITAM SINGH ARORA, J:

1. The present Writ Petition has been filed seeking a direction for setting aside the impugned order dated 1st December, 2021, passed by respondent No. 1 i.e. the Chief Commissioner of Income Tax (TDS), Delhi under Section 279(2) of the Income Tax Act, 1961 (‘the Act’) for Assessment Years (‘AYs’) 2014-15, 2015-16 and 2017-18, rejecting the application filed by petitioner No. 1 to compound the offences punishable under Sections 276B read with 278B of the Act, for defaults committed in Financial Years (‘FYs’) 2013-14, 2014-15 and 2016-17. The petitioner No. 1 further seeks a direction to respondent No. 1 to accept its application dated 20th March, 2021, filed on 22nd March, 2021, for compounding of the offences.

Facts

2. Briefly stated, the facts of the case are that the petitioner No. 1, who was under an obligation to deduct income tax on payments made by it during the course of business, deducted the income tax but the same was deposited belatedly with the Income Tax Department (‘the department’). It is stated by the petitioner that however the deposit of TDS did not cross the due date of filing of return of income in the concerned relevant FYs i.e. 2013-14, 2014-15 and 2016-17.

3. The petitioner further states that the deposit of TDS was made prior to any notice of default received from the department. The details regarding due date of filing of the Income Tax Return (‘ITR’) for the respective assessment years and the last date for payment of TDS in respect of each relevant assessment years are set out in the petition as under:

Sr. No.	AY	Due date of filing the return of income u/s 139(1) of the Act	Latest date on which tax deducted was deposited	Date of filing the return
1.	2014-15	30-11-2014	16-10-2014	30-11-2014
2.	2015-16	30-09-2015	30-09-2015	30-09-2015
3.	2017-18	31-10-2017	24-05-2017	31-10-2017

The petitioner states that the TDS was deposited along with the interest payable on the delayed payment for the relevant financial years. The said fact is not disputed bythe department.

4. The department issued a show cause notice dated 26th December, 2017 to the petitioner for initiating proceedings under Sections 276B read with 278B of the Act due to the admitted default in deposit of TDS in FYs 2013-14, 2014-15 and 2016-17. The petitioner acknowledged receipt of the aforesaid notice on 5th January, 2018 and sought time to reply after examining its record. The petitioner, thereafter received a notice dated 5th December, 2019, under Section 276B of the Act for prosecution.

5. Upon receipt of the said notice, the petitioner filed an application dated 6th January, 2020, to the respondent No. 1 for compounding of the offences for FYs 2013-14, 2014-15 and 2016-17. The said application was withdrawn and a fresh application for compounding of offences under Sections 276B and 278B was filed on 22nd March, 2021, in compliance with the Guidelines dated 14th June, 2019, issued by the Government of India, Ministry of Finance, Department of Revenue, Central Board of Direct Taxes (‘CBDT’) for compounding of the offences under Direct Tax Laws, 2019 (Compounding Guidelines, 2019).

6. The said application for compounding of offences filed on 22nd March, 2021 was processed by the respondent No. 1 and he issued a notice dated 10th November, 2021, recording that the application is not maintainable in light of the para 8.1. (iii) of the Compounding Guidelines, 2019 and also due to the suppression of the fact that the petitioner No. 1 has been convicted for the same offences for FYs 2009-10, 2010-11 and 2011-12, which information was not disclosed in the application. The respondent No. 1 afforded an opportunity to the petitioner No. 1 herein to respond to the said observations. The relevant portion of the notice reads as under:

“2 In this regard, I am directed to convey that your application for compounding of offences is found not maintainable in view of the following reason:-

a. As per Col. 18 of

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