Adv. For the Complainant  : -    Sri  Prabhanjan Hota

        Adv. For O.P. No. 1             :-   No

        Adv. For O.P.No.2                :-  Bikash Chandra Pradhan & Goura Chandra Naik

        Adv. For O.P. No.3               :- Pankaj Kumar Padhi  & Others

        Date  of filing of the Case  :- 14.03.2023

        Date of Order                       :- 30.09.2023

 JUDGMENT

The Fact of the case in nutshell:

1. The complainant  is a registered work contractor by profession she owned a proprietory  firm and is the sole proprietor of the said firm she has also a current account vide
2.  

No.39763374470 in the S.B.I Bazara, Branch Titilagarh bearing branch code No.120092 and IFSC code SBIN0012092 who is OP . No.3 in this case and the said branch is guided by the chairman SBI central office chairman’s secretariat P.B. No.12 , Nariman Point Mumbai - 4000021 who is Op. No.1 in this case each and every kind of TDS . TDC is deducted in the personal vide pan No. CUNPP3707Q under the firm name . The cause of action arises when the complainant came to know that a sum of Rs.1,58,000/- was deducted by OP No.3 towards TDS on dt.23.03.2022. but as per taxation procedure the said amount should be deposited in to her PAN CUNPP3707Q latest by 30.06.2022 and reflected As 26 As statement , which enable the complainant to file the ITR return in time . But unfortunately due to the latches of the OP No.3 due to non updating the same in 26 AS the complainant could not file her ITR return in time wanting reflecting on of the deducted amount in the 26 AS as per sec 194 M of 1961 IT Act for which the last date of filing ITR was 31.07.2022 and due to non reflection of the aforesaid amount the complainant had to filed the ITR by 28.12.2022 without compliance of sec 194N with a penalty of Rs.1000/- imposed by IT Department as late fine.

The complainant has beensubjected to illegal with hold of her money with the Ops .penalized unnecessarily harassment for running to the branch many time also served a pleader notice to update the TDS within 15 days from 09.02.2023. Neither the OP No.3 update it nor released the aforesaid amount till date. Hence the case.

2. To substantiate her case the complainant relied on the following documents.

1. Xerox copy of the pleader notice dated 09/02/2023 .
2. Xerox copy of the postal tracking report.
3. Xerox copy of Bank Statement of Account 2 sheet.
4. Xerox copy of ITR acknowledgement one sheet.
5. Xerox copy of 26 As from site of I.T. Department for the F.Y 2021-22 9 sheets.

3. Having gone through the complainant its accompanied documents and on hearing the complainant prima facie it seemed to be a genuine case hence  admitted and notice to the OPS were served and in response they appear through their advocates and filed their written version.
4. To counter the charge in the rival contention it is admitted that a sum of Rs.1,58,000/- was deducted by the OP No.3 towards TDS on dt.23/03/2022 and averred that the

complainant has not submitted her PAN card at the time of opening of her said current Account as such the said amount of Rs.1,58,000/- could not be reflected in form 26 Aswhich deducted U/S 194 NF from her account and in TDS it was mentioned as ( PAN NOT

AVBL) and deny all the allegation made in the complainant except the fact that after repeated request by the Op No.3 the complainant for the first time on dt.07/12/2022 filed an application KYC details and on the same day it was updated and a request vide ID No.39483 dated 07/12/2022 was sent to the Regional Manager SBI Region-iv for necessary correction vide letter No. RMSL/40/12 dt.07/12/2022 and as per the communication by the LITO the said correction take time of 15 days or more for reflecting the same in 26 As and there after the complainant can file his ITR and prayed to reject the complainant petition of the complainant.

5. To counter the allegation against the Ops the Ops relied on the following documents.

1. Xerox copy of the KYC details updation application of the complainant.
2. Xerox copy of the letter no RMSL /40/12 dated 07/12/2022.
3. Xerox copy of the transaction details of AC No.39763374470.
4. Xerox copy of the TDS amount transfer asu/s/94NF.
5. Xerox copy of the correction request status dated 31/05/2023

      (6 )      Heard the complainant perused the  materials on record with submission and vehement denials of the learned advocate for the Ops with arguments.

    (7 )   After  going through the pleading of both the parties three issues emerged for consideration.

1. Whether the complaint is maintainable ?
2. Whether the complainant has proved his case and the deficiency in service on the part of OP ?
3. Whether the complainant is entitled to any compensation if so the quantum of such compensation?

Issue No.1

              According to the OP the case is barred by limitation hence not maintainable the cause of action arises on dt.23.03.2022 and the case was filed on 14/03/2023. The cause of action is within the limitation period as provided by Sec 69 of the C.P. Act 2019. Which is maintainable . issue No.1 answered accordingly.

Issue No.2

          The Op No.3 urged that there was no PAN card link with the account of the complainant at the time of deduction of TDS Rs.1,58,000/- on dt. 23/03/2022 , which unable the Bank to

-4-

reflect the amount which  deducted u/s 194NFof IT Act 1961 and reflected the same on 26 As statement.

         Therefore  the crux question in this case is the PAN card. This case relates to the F.Y 2021-2022i.e 01.04.2021 to 31.03.2022. In very financial year 30 the June is the due date u/s 139(1) of 1961IT Act for filing ITR or on adverse condition sec 139 (2) the ITR filed after due date with a fire of Rs.1000/- and before 31^st December of every F.Y.

Before going to the core of the  matter it is better to clarify what is 194 N TDS deduction and 26 As statement.

 “ The concept of TDS on cash withdrawals is an important mechanism for the Govt. to track and regulate high –value cash transaction and to curb the circulation of block money in the economy. By deducting tax at the source the government can ensure that the tax liability of the taxpayer is discharged at the earliest  possible stage. It is important for tax payers and financial institutions to be aware of the provisions and comply with the regulations to avoid penalties or legal implications.

         TDS tax deduction at source on cash withdrawals where a certain percentage of tax is deducted at the time of making cash withdrawals from the Bank accounts. The TDs on cash withdraw is applicable under sec 194 N of the IT Act 1961 and was introduced in the union budget 2019.

    According to sec 194 N of the act TDS has to be deducted if a sum or aggregate of sum withdraw in cash by a person in a particular F.Y exceeds 20 Lakh (if no ITR has been filed for all the three previous Assessment year or Rs. 1 corer (if ITR have been filed for all or any of the three A.Y) TDS on cash withdrawals is applicable to all Banks , cooperative Banks and post offices persons who withdraws cash in excess of 1 corer in a F.Y. is liable to pay TDS at the rate of 2 % on the amount exceeding Rs.1 corer ( if return file) and on cash withdrawals in excess of 20 Lakh ( if no ITR has been filed for all the three previous A.Y.) is 5 % if paid it is 2 % like wise on cash withdrawal in excess of Rs. 1 corer ( if no ITR has been filed for all three previous A.Y) it is 5 %.

It is important to mention here that the Banks or post office must ensure that the TDs is deducted and deposited with the government within the prescribed timeline . If TDS is not deducted or deposited with the government within the prescribed time line interest is levied under section 201 of IT Act 1%per month or part of the month from the date on which TDS was required to be deducted till the date on which it is deducted. For quarterly TDS returns the dates 1 quarter April to June due date of return updated is 15^th July 2^nd July to September due

-5-

date 15^th October 3^rd October to December due date of return up-to-date is 15^th  January 4^th one is from January to March as year ending due date is 30^th June of every financial year.

       The documents required for TDS return filing are

1. TDS certificate issued by the diductor
2. Challan copies of TDS payment to the govt.
3. PAN details of the deductee and the diductor. The TDS certificate must be issued within one month from the end of the quarter in which TDS was deducted or must be issued by 15^th June for the F.Y. following the year which the TDS was deducted.

Now the case in hand the complainant submitted all the documents including the PAN while opening the currentaccount. The complainant is also a regular payee of the TDS which reflected on ITR return acknowledgement 2019/2020 , 2020/2021 where the pan number reflected as CUN PP3707Q so it is clear that the PAN is with the Bank moreover it is not so old account which is within 12 years where updation of the KYC is not needed as per Bank circular, Just to save its skin the Op No.3 raised the issue of PAN to

shift the liability upon the shoulder of the complainant if there is no PAN while deducting theTDS on 22.03.2022 the Bank should have inform the complainant and rectify the mistake before Jun30 which is the time line of ITR No documents regarding the massage or any information sent to the complainant by post is filed by the OP No.3 in this regard . As per the guide line it is clearly stated that the Bank or post office must ensure that the TDS is deducted and deposited with the government with in the prescribed time line . The OP No.3 deducted the TDS which reflected in the relevant page of the BankA/C and ledger but not depositedthe same with the government . The OP No.3 shouldhave issue any notice or information to the complainant or provide a TDS certificate to the complainant by 30^th June of the succeeding F.Y.

As  per TDS withdrawal guide line u/s 194N TDS should be deducted if the cash withdrawals exceeds 1 crore as here the complainant filed her return three consecutive previous year she is not comes under 194N, Those who have not filed the return above 20 Lakh withdraw the rate of deduction of tax rate is 5 %and those who filed the return  for previous three years then the rate of tax levied is 2 %  in this case the complainant withdraw Rs.27,90,000/- in that F.Y 2021/2022 above 20 Lakh =27 90,000/- Rs.20,00,000/- = Rs.7,90,000/-@2% tax comes to

-6-

Rs.15,800/- How it was Rs.1,58,000/- is a question mark. Op No.3 did not follow the guideline of 194N only deduct the TDS not deposited it with the government ,  amounts to unfair as well as deceptive trade practice. The OP No.3 not submitted any document which show that the TDS of Rs.1,58,000/- was legal.

       After cut-off date no return can be filed for claiming TDS or there is no scope of revised filing of return . The complainant already filed the return for the said period on dt.28/12/2022 as bound by law and the same has been processed by the department on dt.20/02/2023 where the TDS amount of Rs.1,58,000/- has been denied by the department to refund as no credits to TDS until that time which shows the deficiency of service on the part of Op No.3 to avoid the crisis stay silent by sending a letter of correction was no remedy but a mala fide intention to escape form the crisis. The OP No.3 should not use  the KYC updation as a defence weapon to save its skin.

        Sec 11 of C.P Act 2019 define deficiency means any fault , imperfection, short comings or inadequacy in the quality . nature and manner of performance which is required to be maintained by or under any law for the time being in force or has been undertaken to be performed by a person in pursuance of a contract or otherwise in relation of a contract or otherwise in relation to any service and includes .

1. Any act of negligence or omission or commission by such person which causes loss or injury to the consumer and
2. Deliberately with holding of relevant information by such person to the consumer.

This commission gone through the record carefully and came to the finding that as per 26 AS copy on record it is clear that the tax amount of Rs.1,58,000/- has been reflected in 26AS statement subsequently is of no use to the complainant since it has not been timely filed the return has already been processed and there is no scope in the hand of the complainant to claim the same. still the complainanttried to filed the rectification petition u/s 154 of IT Act 1961 of the order dt.25/07/2023 the IT Department has rejected the refund claim as such the latches, negligence or commission or omission of the act OP No.3 is amount to deficiency in service accordingly the complainant prove its case and the issue no.2 answeraccordingly.

Due to the negligence or ignorance of Op No.3 the tax has been deducted under section 194NF which stated in Para 2 of its written version which is wrong as an financial institution the bank authorities should have knowledge about the applicability and procedure of tax deduction if they have no knowledge they could have gone through the IT Department website to earn knowledge. Here in this case in hand 194NF is no

way applicable and has been applied wrongly and illegally by authority of the bank is arbitrary.

Sec 194 NF defines in 1961 IT Act as it applies to any income distributed by a business trust or investment fund to its unit holder. This section required the person responsible for making the payment to the unit holder to deduct tax at the rate of 10% on the income distributed.

OP No.3 have ample opportunity to rectify the same after updation of the KYC before 31.12.2022 before filing the ITR by the complainant as such the complainant is entitled for compensation of Rs.1,58,000/- which the complainant should have refund from the IT Department the late fee of Rs.1,000 and due to the illegal deduction of a huge amount he suffer mental agony for which Rs.30,000/- and other litigation expenses.

More over the OP No.2 is exempted as there is no direct link with OP NO.3 in this connection issue no.3 answer accordingly.

In view of the aforesaid analysis the complaint is allowed in favourof the complainant with following direction the complainant entitled for relief as prayed for

                                                                ORDER

It is directed OP No.3 to pay a sum of Rs.1,59,000/- @ 9% interest per annum from the date of occurrence i.e. 23.03.2022 till the date of order, and a sum ofRs.30,000/- towards mental agony Rs.5000/- towards litigation expenses within one month from the date of order failing which the entire amount should be paid by OP No.3@ 12 % per annum from the date of incident till realization.

No award as to cost

   PRONOUNCED IN THE OPEN COMMISSION TODAY I.E DATED  30^th   DAY OF  September’2023