Voltamp Transformers Ltd. vs Deputy Commissioner of Income Tax

Parties Involved

Facts Summary

The Assessee-company, engaged in the manufacturing of industrial transformers, was subjected to a spot verification proceeding under Section 133A(2A) of the Income Tax Act. The Assessing Officer discovered that the company had made substantial transportation payments without deducting Tax Deduction at Source (TDS) under Section 194C of the Act. The Assessee claimed exemption under Section 194C(6) based on declarations that payee transporters owned ten or fewer goods carriages. However, scrutiny revealed that the declarations omitted crucial statutory details, and the Assessee was fully aware of CBDT Circular No. 19/2015. The Assessee circulated its own declaration forms to various transporters, and substantial payments were made without TDS to large transport operators. The Assessing Officer issued a show-cause notice to the Assessee, who contended that Section 194C(6) did not impose any statutory duty to verify the truthfulness or correctness of a declaration. The Assessing Officer rejected these contentions, holding that the Assessee had knowingly accepted declaration/documents which were non-est on account of discrepancies and omissions. The Assessing Officer passed an Order, dated 19/06/2023, treating the Assessee as an 'Assesssee-in-Default' and determining a total demand at INR.31,34,257/- for Assessment Year 2021-2022. The Assessee preferred an appeal before the Ld. CIT(A), which was dismissed. The Assessee then preferred the present appeal before the Tribunal.…

Legal Issues

• 1. Applicability of Section 194C(6) of the Act
• 2. Contention regarding the format of declaration under Section 194C(6) of the Act

Judgment Outcome

Decided in favour of Assessee.

Precedents Relied Upon

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