Law:

Section:

Section 201 of the Income-tax Act, 1961 - Deduction of tax at source - Consequences of failure to deduct or pay - Assessment year 1999-2000 - Petitioner paid interest to depositors for which he was required to deduct tax at source on non-filing of declaration by depositors in Form No. 15H - Form No. 15H was accepted only on first day of succeeding year, i.e. 1-4-1999 - Whether petitioner having not received Form No. 15H within financial year 1998-99, he would be deemed to be an assessee-in-default - Held, yes FACTS The petitioner had paid interest exceeding Rs. 2,500 to various creditors and from such creditors Form No. 15H was not received by him for the financial year 1998-99 up to 31-3-1999. Form No. 15H was received by the petitioner on 1-4-1999. A show-cause notice was issued to the petitioner deeming him to be an assessee-in-default in respect of tax which was required to be deducted by him at source. The ITO initiated proceedings and passed order by which the petitioner was required to pay the amount he was required to deduct as TDS. On revision, the Commissioner affirmed the order of the Assessing Officer. On writ : HELD What was not claimed was that the Form No. 15H was received by the petitioner on 1-4-1999. The interest was paid to various depositors for amount more than Rs. 2,500 during the financial year 1998-99. No tax was deducted at source until 31-3-1999. Thus, in the financial year 1998-99 though the petitioner credited interest to various persons above Rs. 2,500, yet he had not deducted tax at source. The petitioner had not received Form No. 15H until the conclusion of the financial year 1998-99. In that background, if the argument of the petitioner was accepted that the Form was received on 1-4-1999, and it was only a technical breach, then, what would have followed would be that the deeming clause in section 201 would became redundant. Having not received Form No. 15H within the financial year 1998-99, he would be deemed to be an assessee-in-default. Therefore, on that count, no illegality was seen in the action of the respondent officers of the Income-tax Department. [Para 7] Dinesh Mehta for the Petitioner. L.M. Lodha for the Respondent.…

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