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Income Tax Appellate Tribunal, DEHRADUN BENCH: ‘DB’ DEHRADUN
Before: SHRI SAKTIJIT DEY & DR. B.R.R. KUMAR
PER BENCH: Captioned appeals by the appellant arise out of separate orders passed by learned Commissioner of Income Tax (Appeals), Haldwani, upholding levy of fee under section 234E of the Income-tax Act, 1961 (in short ‘the Act’) for different periods.
When the appeals were called for hearing, none appeared on behalf of the assessee to represent the appeals, despite issuance of notice of hearing. Therefore, considering the nature of dispute arising in these appeals, we proceed to dispose of the appeals ex- parte qua the appellant after hearing learned Departmental Representative and based on the materials available on record.
Before we proceed to deal with the substantive issue raised in these appeals, it is necessary to observe, Registry has notified a 2 | P a g e delay of 18 days in filing these appeals. Having taken note of the averments made in applications filed seeking condonation of delay, we are satisfied that the delay in filing the appeals was due to reasonable cause. Accordingly, we condone the delay in filing the appeals and admit them for adjudication on merits. As stated earlier, the common dispute in all these appeals relates to levy of fee under section 234E of the Act for default in furnishing Tax Deducted at Source (TDS) statements within the prescribed time limit.
Briefly the facts are, while processing TDS statements furnished by the assessee for different quarters in relevant financial year, the Assessing Officer noticed, such TDS statements were not furnished within the time limit prescribed under the statute. Thus, invoking the provisions of section 200A(1)(c) of the Act, the Assessing Officer charged fee under section 234E of the Act in respect of TDS statements furnished beyond the prescribed time limit. Though, against the intimations issued under section 200A of the Act, the assessee preferred appeals before learned Commissioner (Appeals), however, the appeals were dismissed in limine by learned Commissioner (Appeals) due to inordinate delay of more than 3 years in filing the appeals.
We have heard learned Departmental Representative and perused the materials on record. As per the provisions of section 200 of the Act, a person responsible for deducting tax at source is required to remit the TDS amount to the Government account and furnish statement of tax deducted at source within the prescribed time limit. In case, there is default in furnishing the TDS statement within the prescribed time limit, section 234E provides for levy of fee. Though, section 234E of the Act was a part of the statute with effect from 01.07.2012. However, there was no enabling provision in the Statue laying down the mechanism to levy and collect fee chargeable under section 234E of the Act. However, by Finance Act, 2015 clause (c) was introduced to section 200A(1) with effect from 01.06.2015 empowering the authority concerned to levy fee under section 234E of the Act while processing TDS statement. Thus, under section 200A of the Act, the authority concerned is empowered to levy fee under section 234E of the Act prospectively with effect from 01.06.2015.
In case of Fatheraj Singhvi Vs. Union of India [2016] 73 taxmann.com 252 (Karnataka), the Hon’ble Karnataka High Court while interpreting the provisions of sections 234E and 200A of the Act has held that fee under section 234E of the Act cannot be levied in respect of TDS statements furnished for a period prior to 01.06.2015. Same view has been expressed by Hon’ble Kerala High Court in case of Sark Cable (P.) Ltd. Vs. ITO [2022] 142 taxmann.com 30 (Kerala). Even, different Benches of the Tribunal have expressed identical view. Thus, as per the ratio laid down in various judicial precedents, the jurisdiction to levy late fee under section 234E was given only from 01.06.2015. That being the legal position, fee under section 234E of the Act cannot be levied for any period prior to 01.06.2015.
As discussed earlier, learned Commissioner (Appeals) has dismissed the appeals in limine without deciding the issue on merits. Keeping in view the legal position that late filing fee under section 234E of the Act cannot be levied for any period prior to 01.06.2015. Whereas, in the facts of the present appeals, late filing fee under section 234E of the Act has been levied even for periods prior to 01.06.2015. Therefore, we are inclined to set aside the impugned orders of learned Commissioner (Appeals) and 5 | P a g e restore the issue to the Assessing Officer/TDS Officer with a direction to levy fee under section 234E of the Act only in cases where there is delay in filing the TDS statements for periods after 01.06.2015.
In the result, appeals are allowed for statistical purposes. 8.
Order pronounced in the open court on 28th February, 2023