Penalty u/s 221

This query is : Resolved

R. S. Kesari (Querist)
Follow

30 October 2010 Dear Experts,

A company has dedcuted TDS during the year 2007-08 and 2008-09. Instead of depositing the tax monthly, it deposited in long intervals e.g. TDS decuted from Apr'07 to Dec' 07 was despoited in Mar'08 and like that. Although the company has paid interest for late payment as asked by the department, the the department further wants to initiate penalty proceeding u/s 221.

Is there any way out to avoid the penalty? Please advise with supporting case law if any.

CA Shailesh Kumar Bhagat

CA Shailesh Kumar Bhagat (Expert)
Follow

30 October 2010 First , what was the reason to make the deposit of tax so late instead of depositing on due dates.

If the reasons are acceptable, then there may be some way, otherwise penalty procedding is correctly initaited by the Deptt.

Message likes : 1 times

CA.Amit Revankar

CA.Amit Revankar (Expert)
Follow

30 October 2010 Dear Kesari,
1)As per law, the AO is extremly correct in levying the penalty and furthur u cant challenge him legally,
2)Reference of case law are generally taken when there is requirement of clarification on any law matters, otherwise it may not be so useful.

Advice :
According to me, the only way with u is "CONVENCING", try to convince the AO that penalty may cause "undue hardship or similar" with strong justification. If the Ao doesnt agree make an application to its juridicational superior officer.

Message likes : 1 times

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now