AMARJEET BEETON Vs. COMMISSIONER OF INCOME TAX (TDS)

JUDGEMENT

(1.) The petitioners seek a writ of certiorari to quash a clarification dated 16.08.2016 issued by respondent No. 2 Deputy Commissioner of Income Tax (TDS), Ludhiana stating that cotton waste is scrap within the meaning of the term under Sec. 206C of the Income Tax Act, 1961 (in short the Act) and that accordingly TCS (Tax Collection at Source) would continue to apply. Respondent No. 1 is the Commissioner of Income Tax (TDS), Chandigarh.

(2.) We see no reason to entertain this writ petition under the Act. There is uncertainty regarding the applicability of Sec. 206C of the Act to cotton waste. Sec. 206C(1) in so far as it is relevant reads as under:-

(3.) The petitioners contend that the Madras High Court and the Gujarat High Court have decided the issue in their favour, although in respect of other parties. Respondent No. 3 sought a clarification in this regard from the department. Initially, a clarification was issued on 24.05.2016 stating that cotton waste is not covered under the definition of scrap contained in Sec. 206C(1) read with explanation (b). By a further communication dated 29.06.2016, the department stated as under:-