Section 248 — Appeal by Person Denying Liability to Deduct Tax

Section 248 of the Income-tax Act, 1961 provides a mechanism for a person who is required to deduct tax at source to appeal against the order of an Assessing Officer if they deny their liability to make such a deduction. This section is significant as it allows the deductor to challenge the imposition of tax deduction at source (TDS) obligations that they believe are not applicable. The statutory test involves the deductor demonstrating that the conditions for TDS are not met. The burden of proof lies with the deductor to establish that they are not liable to deduct tax. Practically, this section is crucial for entities that face TDS demands on transactions they believe are exempt or not covered under TDS provisions, allowing them to seek relief through the appellate process.

Common Litigation Flashpoints

1. Dispute over the applicability of TDS provisions
2. Challenges to the Assessing Officer's order on TDS liability
3. Interpretation of transactions exempt from TDS
4. Burden of proof in establishing non-liability for TDS

Judgments on Section 248 — Appeal by Person Denying Liability to Deduct Tax

• Commissioner of Income Tax, Bangalore vs B. C. Srinivasa Setty — SC,
  Goodwill generated in a newly commenced business cannot be described as an 'asset' within the terms of Section 45 and therefore its transfer is not subject to income-tax under the head 'capital gains'
• Union of India & Anr. vs M/s. Ganpati Dealcom Pvt. Ltd. — SC,
  The 2016 Amendment Act cannot be applied retrospectively as it creates new offences and substantive changes, which cannot be applied to past transactions.