Belated Deposit of TDS: Andhra Pradesh HC quashes Prosecution Proceedings as Assessee Paid Tax along with Late Payment Interest

The Andhra Pradesh High Court has quashed the prosecution proceedings against M/s Aditya Institute Of Technology And Management for delayed deposit of tax deducted at source (TDS). The Court found that the assessee paid the tax along with late payment interest. The institution had delayed crediting TDS to the Central Government’s account for assessment years 2014–15, 2015–16, and 2016–17. \r

The delays were due to late fee reimbursements from the government of Andhra Pradesh. The Court ruled that since the tax was eventually paid with interest, there were no grounds for prosecution. \r

The Commissioner of Income Tax's proceedings under Section 279(1) of the Income Tax Act were deemed invalid, as the institution provided a reasonable cause for the delay. Justice Venkata Jyothirmai Pratapa noted that the reasonable cause justified under Section 278AA of the Income Tax Act meant criminal prosecution was not warranted, leading to the quashing of the proceedings.