Question And Answer
Subject: Prosecution proceedings for delay in payment of TDS
Querist: prakash
Answered by:
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Date: November 12, 2023
Query asked by prakash

Assessee is charitable trust having object of Education . During the year due to financial difficulties could not make the payment of TDS in time , however before receiving any notice from the department paid the TDS along with the interest . Now PCIT has issued SCN U/SEc. 276B/276BB of the Act. Assessee trust has submitted detailed reply stating the reasons for delay . however the PCIT  has decided to initiate the prosecution proceedings . whether he is justified in law ? is there any remedy available ?  whether the assessee should filed the WP before the HC?

pl guide

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Answer given by

Prosecution cannot be launched against all the trustees . Only the person in charge as per section 2(35 ) of the Act can be held responsible . In Golden Gate Properties Ltd. v. DCIT (2019) 179 DTR 241/ 310 CTR 351 (Karn.)(HC) the court held that the fact that the TDS has been deposited subsequently does not absolve the offence. The fact that penalty U/s. 221 has not been levied is not relevant because there is an admitted delay in depositing TDS . Against show cause notice the writ cannot be filed. When the prosecution is launched before the Magistrate Court , the assessee may file a writ petition or revision to quash the proceedings , if the prosecution is launched without following the due process of law . If the amount the small the assessee may approach for compounding of offences .

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One comment on “Prosecution proceedings for delay in payment of TDS
  1. Pawan Singla says:

    Please read 156 151, jharkhand High court, 2023,
    If tds and interest is deposited before date of filing of complaint and no penalty proceedings iniated, then prosecution cannot be launched

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