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Income Tax Appellate Tribunal, ‘C’ BENCH : BANGALORE
Before: SHRI CHANDRA POOJARI & SMT. BEENA PILLAI
ORDER
PER BEENA PILLAI, JUDICIAL MEMBER Present appeal is filed by assessee against order dated 24/12/2022 passed by NFAC, Delhi for A.Y. 2021-22 on following grounds of appeal: “1.1 On the facts and circumstances of the case, the learned CIT(A) of NFAC erred in levying additional interest u/s 234A of Rs.34,080/- without appreciating the fact, the assessee had paid all tax and interest on 30-09- 2021which is before due date of filing return of income. 1.2 On the facts and circumstances of the case, the learned CIT(A) of NFAC erred in not appreciating the fact that the income tax return could not be filed on time due to the upgradation and other problems in the income tax portal. In the interest of fairness of justice additional interest under section 234A raised of Rs.34,080/- needs to Page 2 of be withdrawn since no tax was due on the date of filing the return. The appellant seeks leave to add to, to amend, alter or delete any of the foregoing grounds as and when considered necessary/at the time of hearing.”
2. Brief facts of the case are as under: 2.1. The assessee is an individual and has income from salary, house property and income from other sources. The assessee filed the return of income on 01.10.2021. Copy of acknowledgment for having filed return of income for the above said year along with computation of total income is enclosed in the paper book at pages 3 to 12. 2.2. The assessee filed the return of income for Assessment Year 2021-22 on 01.10.2021 declaring total income of Rs.1,34,91,260/-. The return was processed by CPC on 18.11.2021 u/s. 143(1). The Ld.AO, CPC levied interest u/s. 234A amounting to Rs.1,02,261/-. 2.3. The assessee paid self-assessment tax and interest in September 2021 and tried to file the rectification of income in September 2021. However due to challenges faced due to the new Income Tax portal, the assessee was able to upload return filed on 01.10.2021 declaring income of Rs.1,34,91,260/-. 2.4. The Ld.AO passed an intimation dated 18.11.2021 levying interest u/s. 234A amounting to Rs.1,02,261/- instead of Rs.68,174/-. Consequently, additional demand of Rs.34,080/- was raised. 2.5. Aggrieved by the impugned levy of Rs.1,02,261/- made by the Ld.AO in the intimation order passed u/s. 143(1), the assessee filed appeal before the Ld.CIT(A).
Page 3 of 2.6. The Ld.CIT(A) after considering the submissions held as under: “I have carefully perused the impugned Intimation order /s 143(1) of the Act. contentions of the appellant and the relevant provision of the Act and the CBDT circular No. 9/2021 dated 20/-5/2021 relevant to extension of time limits of due dates of filing returns etc. The only ground of appeal relates to levy of interest u/s 234A of the Act of Rs 1,02,261/- instead of the appellant-calculated Rs 68,174/-. The appellant contends that there were glitches while uploading the return on 30-09-2021 and he also made correspondence with Income Tax helpdesk for the same. However, it may be stated here that owing to reshaping of IT e-filing portal in 2021, there indeed were technical and portal related glitches in filing returns and submissions faced by the tax payers. However, it must also be borne in mind that to ease the difficulties that arose due to these glitches, the CBDT extended time lines not once but thrice- firstly vide circular no. 9/2021 dated 20-05-2021, subsequently vide circular no. 17/2021 dated 09/09/2021 and lastly vide circular no. 1/2022 dated 11/01/2022. However, in all these circulars it was clearly stated by way of a clarification that wherever the self- assessment tax, after reducing prepaid tax, various reliefs as specified in section 234A of the Act and advance tax paid from the total tax liability was more than Rs 1 lakh, the due dates only for the purpose of section 234A shall remain as specified in the said section and therefore the interest under the said section will be levied accordingly. In case of the appellant from a perusal of the ITR filed in the captioned AY, it is seen that Self Assessment tax paid on September, 2021 was to the tune of Rs 34,76,925/- and thus according to the clarification in circular 9/2021 dated 20-05-2021, interest u/s 234A was levied by the CPC. Further, if I may say that noone should wait till the last date of compliance and should try to comply with satutory compliances as soon as possible since it is always seen with all things computerized and digital, having a hassle free experience on the last day of a particular compliance is well nigh impossible due to high load on the system. Therefore, in light of above discussion, I find no infirmity in the impugned intimation order dated 18-11-2021 and thus the appeal of the appellant stands dismissed.”
Page 4 of 2.7. The Ld.AR submitted that while passing the intimation u/s. 143(1), interest u/s. 234A has been charged as Rs.1,02,261/- instead of Rs.68,174/- as calculated by the assessee resulting in additional interest of Rs.34,087/-. 2.8. It is submitted that the assessee paid all the taxes on time and tried to file the return of income on 30.09.2021, however there were certain glitches in the new income tax portal, due to which the return could not be filed on 30.09.2021. However, the return of income was filed on immediate subsequent day, i.e. 01.10.2021. Copy of acknowledgment for having filed the return on the subsequent day is enclosed for your ready reference. 2.9. He placed reliance on the Circular Nos. 9/2021 dated 20.05.2021 and 17/2021 dated 09.09.2021. He also placed reliance on the decision of Hon’ble Supreme Court in case of CIT vs. Pranoy Roy reported in (2009) 179 Taxman 53 and Circular No. 02/2015 dated 10.02.2015. 2.10. On the contrary, the Ld.DR relied on the orders passed by authorities below.
We have perused the submissions advanced by both sides in the light of records placed before us. 3.1. Admittedly the assessee has paid the taxes before 30.09.2021. The return could not be uploaded due to certain technical issues faced by the assessee for which an interest u/s. 234A has been levied. This fact of the technical glitch that was persistent during the relevant period is acknowledged by the Ld.CIT(A) in the impugned order. After acknowledging the practical difficulty it was wrong on the part of the Ld.CIT(A) to cast the burden of interest on the assessee u/s. 234A when the Page 5 of entire taxes has been paid prior to the due date of filing of return. Infact the CPC has accepted the original return filed by the assessee as it is evident from the intimation passed u/s. 143(1) of the act. 3.2. Under such circumstances, the benefit definitely has to be given to the assessee as per the ratio laid down by Hon’ble Supreme Court in case of CIT vs. Pranoy Roy (supra) and the clarification issued by the CBDT vide Circular No. 02/2015 dated 10.02.2015. Accordingly, we direct the Ld.AO to delete the interest levied u/s. 234A of the act. In the result, the appeal filed by the assessee stands allowed. Order pronounced in the open court on 26th June, 2023.