Law:

Section:

â- Section 201 of the Income-tax Act, 1961 - Deduction of tax at source - Consequence of failure to deduct or pay - Whether reimbursement of expenditure for maintaining conveyance having been treated by employer as an allowance not taxable, not deducting tax at source does not raise any question of law but is primarily a question of fact - Held, yes - During survey conducted at premises of assessee, it came to be noticed that employees were getting conveyance allowance and LTA which were not considered for purpose of deduction of tax from salary - Assessee contended that it was under bona fide belief that conveyance allowance was not liable to tax and was, thus, not included in estimated income of employee - Assessee further stated that it as an employer was not required to compute taxable income of employees and provisions of section 201(1) were not attracted to its case - Assessing Officer noticing that there were no supporting documents that actually showed that amount was incurred, estimated quantum of short deduction of tax under section 201(1) along with interest - Commissioner (Appeals) and Tribunal accepted bona fides of assessee - Whether if Assessing Officer was not satisfied with declaration furnished by employee, nothing prevented Assessing Officer to direct assessee to produce supporting documents before him to show that expenses claimed were actually incurred by concerned employees - Held, yes - Whether since estimated income reflected by assessee was based on bona fide estimation and on that ground alone more particularly in absence of any specific directions of Assessing Officer, no fault could be found with findings of Commissioner (Appeals) and Tribunal - Held, yes - Whether on facts, it could be said that there was no question much less a substantial question of law arising for consideration in instant case - Held, yes FACTS The assessee was dealing in computer hardwares. During survey conducted at the premises of the assessee, it came to be noticed that the employees were getting conveyance allowance and LTA which were not considered for purpose of deduction of tax from salary. Further, the assessee had not obtained any documentary…

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