Income-tax Act, 1961 — Section 139A(5B) and S. 272B — Whether Press Release dated September 25, 2007 and February 12, 2008 issued by CBDT brings down the rigours of S. 139A(5B) —Held : Yes. Whether penalty u/s. 272B cannot be levied in a case where an ass

Hewlett-Packard Globalsoft Pvt. Ltd. vs. DCIT.

A.Y. : 2008-2009. Date of Order : 25.3.2009

Income-tax Act, 1961 — Section 139A(5B) and S. 272B —
Whether Press Release dated September 25, 2007 and February 12, 2008 issued by
CBDT brings down the rigours of S. 139A(5B) —Held : Yes. Whether penalty u/s.
272B cannot be levied in a case where an assessee has submitted Permanent
Account Number of such number of deductees as satisfies the threshold limit
mentioned in the Press Release issued by CBDT —Held : Yes.

 

Facts :

The Assessing Officer (AO) found that the assessee had
filed its quarterly statement in Form No. 24Q for the 3rd quarter of financial
year 2007-08 wherein it had not furnished Permanent Account Number (PAN) of
2154 deductees out of the total of 29,733 deductees. He also found that
details furnished for 38 deductees were not in accordance with the provisions
of S. 139A(5B) of the Act. In response to the show-cause notice issued by the
AO the assessee submitted that the number of deductees whose PAN had been
furnished by the assessee exceeded the threshold limit of 90% stated in the
press release issued by the CBDT and therefore penalty u/s. 272B is not
leviable. However, the AO was of the view that the compliance to the extent of
threshold limit stated in press release issued by the CBDT is only for filing
quarterly TDS statements and that such compliance does not debar an AO from
initiating penal action. He, accordingly, levied penalty u/s. 272B. The CIT(A)
confirmed the action of the AO. Aggrieved, the assessee preferred an appeal to
the Tribunal.

Held :

The Tribunal upon going through the Press Release dated
September 25, 2007 and also subsequent Press Release dated February 12, 2008,
held that it is evident from paras 2 and 3 of the Press Release that the CBDT
has prescribed a threshold limit for compliance i.e., to provide
information of PAN data by virtue of S. 139A(5B)(iv) of the Act. It held that
the sole intention of the Press Release is to bring down the rigour of the
provision of S. 139A(5B) and 272B keeping in view the laborious and cumbersome
task of compliance.

Since the assessee had furnished PAN data to the extent of
93% of the total deductees there was compliance in furnishing PAN data in
accordance with the threshold limit of 90% prescribed in press release by the
CBDT, the penal provisions were held to be not attracted. Accordingly, the
Tribunal deleted the penalty levied u/s. 272B of the Act.