| COURT: | Delhi High Court |
| CORAM: | R. K. Gauba J, Ravindra Bhat J |
| SECTION(S): | 201, 234B |
| GENRE: | Domestic Tax |
| CATCH WORDS: | 234B interest, advance tax |
| COUNSEL: | Sachit Jolly |
| DATE: | January 12, 2015 (Date of pronouncement) |
| DATE: | February 2, 2015 (Date of publication) |
| AY: | 2000-01 to 2006-07 |
| FILE: | Click here to view full post with file download link |
| CITATION: | |
| S. 234B: View in Alcatel Lucent that assessee must pay interest for short-fall of advance-tax if it induced payee not to deduct TDS cannot be followed. View in Jacobs has to be followed because obligation of payer to deduct TDS is absolute & not dependent on assertion of payee. Impact of Proviso to s. 209(1) inserted by FA 2012 w.e.f. 1.4.2012 considered | |
This Court respectfully cannot apply the view taken in Alcatel Lucent to this case. This is because if the payer deducts tax at source only when the assessee admits tax liability, then deductions would not be made in cases where the assessee either falsely or under a bona fide mistake denies tax liability. Tax obligations cannot be founded on assertions of interested parties. In such cases, the payer’s obligation to deduct tax would depend on the payee’s opinion of whether it is liable to tax, which may differ from its actual liability to tax as determined by the AO’s final order. This effectively authorizes the assessee and the payer to contract out of the statutory obligation to deduct tax at source, which in this case, is located in Section 195(1). Surely this could not be the Parliamentary intent
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