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Late filling of tds return

neha jain (student) (124 Points)

10 June 2016

can we make appeal to A.O. for waiving the tax liablity for non filling the tds return or whether the A.O has the right to reduce such penalty. One of our client has filled return of Q-4 for F.y.2014-15 as on 08/06/2016. In nutshell is there is way to reduce such demand,

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Profanto.com (Founder) (26 Points)
Replied 10 June 2016

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CA Saurabh Singh (Practising Chartered ) (974 Points)
Replied 10 June 2016

Hi Neha,

The ways in which relaxtion of penalty from untimely filling of TDS return could be sought are:

1. No penalty will be levied under section 271H for the failure to file the TDS/TCS return, if the person proves that after paying tax deducted/collected by him, along with the late-filing fee and interest (if any), to the credit of the Central Government, he had filed the TDS/TCS return before the expiry of a period of one year from the due date of filing the TDS/TCS return. In other words, no penalty under section 271H will be levied in case of delay in filing the TDS/TCS return if following conditions are satisfied:

The tax deducted/collected at source is paid to the credit of the Government.
Late filing fees and interest (if any) is paid to the credit of the Government.
The TDS/TCD return is filed before the expiry of a period of one year from the due date specified in this behalf.

It should be noted that the above relaxation is applicable only in case of penalty levied under section 271H for delay in filing the TDS/TCS return and not in case of filing incorrect TDS/TCS statement.

2. Apart from above relaxation, in following two cases the taxpayer can get relief from penalty under section 271H:

Under section 273A(4) the Principal Commissioner of Income-tax or Commissioner of Income-tax has power to waive or reduce the penalty levied under the Income-tax Act. Penalty can be waived or reduced by the Commissioner of Income-tax if the conditions specified in section 273A(4) in this regard are satisfied.
Apart from shelter of section 273A(4), section 273B also provides immunityfrom penalty in genuine cases. As per section 273B, penalty under section 27111 will not be levied if the taxpayer proves that there was a reasonable cause for failure.

Thanks