JOHN BUILDWELL INDIA PRIVATE LTD.,TIRUNELVELI vs. DCIT CPC-TDS, GHAZIABAD

आयकर अपीलीय अिधकरण, ’सी’ �यायपीठ, चे�ई। IN THE INCOME TAX APPELLATE TRIBUNAL ‘C’ BENCH: CHENNAI �ी वी. दुगा� राव, माननीय �ाियक सद� एवं �ी मंजूनाथा .जी, माननीय लेखा सद� के सम� BEFORE SHRI V. DURGA RAO, HON’BLEJUDICIAL MEMBER AND SHRIMANJUNATHA. G, HON’BLE ACCOUNTANT MEMBER आयकर अपील सं./ITA Nos.88 to 90 & 91 to 92/Chny/2023 िनधा�रण वष�/Assessment Years: 2013-14 & 2014-15 M/s.John Buildwell India Pvt. Ltd., v. The Dy. Commissioner- 10/2, Seevalaperi Road, of Income Tax, Palayankottai, CPC-TDS, Tirunelveli-627 002. Ghaziabad. [PAN: AABCJ 9298 D] (अपीलाथ�/Appellant) (��यथ�/Respondent) अपीलाथ� क� ओर से/ Appellant by : None ��यथ� क� ओर से /Respondent by : Mr.P. Sajit Kumar, JCIT : सुनवाईक�तारीख/Date of Hearing 28.02.2023 : घोषणाक�तारीख /Date of Pronouncement 28.02.2023 आदेश / O R D E R PER MANJUNATHA.G, AM:

These five appeals filed by the assessee are directed against

separate, but identical orders of the Commissioner of Income Tax

(Appeals), National Faceless Appeal Centre, (NFAC) Delhi, all dated

01.12.2022 and pertains to assessment years 2013-14 & 2014-15. Since,

facts are identical and issues are common, for the sake of convenience,

these appeals were heard together and are being disposed off, by this

consolidated order.

company, engaged in the business of civil construction. As there was a

requirement to deduct tax at source on payments made by them, the

ITA Nos.88-92/Chny/2023 :: 2 ::

appellant deducted and paid the same. The appellant paid the interest

due by them on late payment of the tax wherever applicable. However,

there was a delay in filing the TDS statements in respect of the quarterly

statements namely 24Q and 26Q during various quarters relating to

periods prior to 01.06.2015. While processing the TDS statements under

section 200A of the Income Tax Act, 1961 the Deputy Commissioner of

Income tax, Centralized Processing Cell -TDS, Ghaziabad has levied a late

filing fee under section 234E of the Act. The assessee appealed against

such levy of the late filing fee in respect of various intimations issued by

CPC-TDS relating to the AY 2013-14 and AY 2014-15 before the

Commissioner of income Tax (Appeals)-NFAC. The learned Commissioner

of Income Tax (Appeals)-NFAC dismissed appeals stating that there is no

merit in the grounds of appeal relating to levy of fee u/s.234E of the Act.

written submissions explaining the facts and arguments in respect of all

five appeals and the same has been perused. We have heard the ld. DR

and considered the relevant materials on record. The Ld.DR submitted

that although, the assessee has filed original statements in Form No.24Q

& 26Q for relevant quarters in FY 2012-13 & FY 2013-14, but has filed

correction statements after introduction of Sub-clause (C) in Sec.200A of

the Income Tax Act, 1961, by the Finance Act, 2015 and thus, late fee

levied by the AO u/s.234E of the Act, while processing quarterly TDS

returns is in accordance with law and upheld by various courts and

ITA Nos.88-92/Chny/2023 :: 3 ::

Tribunals. We find that there is no provision in the Income Tax Act, 1961

as it stood before 01.06.2015 to levy the fees prescribed under section

234E. The enabling provision in this regard was introduced by the Finance

Act, 2015 by substituting clause (c) with a new clause in section 200A

which has come into force with effect from 01.06.2015. In view of this the

power to levy the fees under section 234E while processing the TDS

statement is vested with the Processing Authority only in respect of

quarterly statements filed after 01,06.2015. The Memorandum explaining

the insertion of provision relating to the insertion of clause (c) to section

20QA of the Act clarifies the intention of the Legislature in inserting the

said provision. The Finance Bill further clearly provides that the

amendment took effect from 01.06.2015, so there is no indication

whatsoever that clause (c) of section 200A is retrospective or clarificatory

in nature. The substitution of clause {c} in subsection (1) of section 200A

by Finance Act 2015 with effect from 01.06.2015 is clearly a substantive

provision and therefore is to be construed to be operative prospectively.

The amendment cannot be neither purport to be merely clarificatory nor

is there any material to suggest that it was intended by Parliament. The

decision of the Supreme Court in CIT vs Vatika Township Pvt. Limited

2014 367 ITR 466 SC also explained how amendments should be read.

the demand notices under section 200A by the respondent authority for

intimation for payment of fee under section 234E can be said as without

ITA Nos.88-92/Chny/2023 :: 4 ::

authority of law and are to be set aside. In similar circumstances in the

case of Smt G.lndhirani vs DCIT,CPC-TDS (ITA Nos1019,1020 and

1021/Mds/2015), ITAT 'A' Bench Chennai (2015) 60 taxmann.com 312

(Chennai- Trib) and in the recent case of Sam & Co vs ACIT, CPC-TDS,

Ghaziabad (ITA No.595/Chny/2021) dt.16.08.2022 of ITAT 'C’ Bench

Chennai has held that the fee levied by the Assessing Officer under

section 234E of the Act while processing the statement of tax deducted at

source is beyond the scope of adjustment provided under Section 200A of

the Act. In the case of Fatheraj Singhvi v. Union of India (2016) 73

Taxmann.com 252, the Karnataka High Court has held that the fee under

section 234E brought about with effect from 01.06,2015 is prospective,

hence no computation of fee for demand or intimation for fee under

section 234E could be made for TDS deducted for respective assessment

years prior to 01.06.2015. In similar circumstances in the recent case of

Karnataka Gramin Bank vs ACIT, CPC-TDS, Ghaziabad (ITA No. 593 to

672/Bang/2Q22) dt.05.09.2022 of ITAT 'C' Bench Bangalore has held that

the fee levied by the Assessing Officer under section 234E of the Act while

processing the statement of tax deducted at source is beyond the scope

of adjustment provided under Section 200A of the Act. In a recent case

relating to AY 2015-16, in ITA No.3681/Del/2017 in the order dated

09.07.2021, the ITAT, Delhi in the case of Shri Raj Veer Singh vs ACIT,

CPC-TDS, Vaishali, Ghaziabad has held that the fee levied for periods

prior to 01.06.2015 is not sustainable in the eyes of law.

ITA Nos.88-92/Chny/2023 :: 5 ::

of the case, we are of the considered view that there is no provision under

section 200A of the Act, while processing quarterly TDS statements filed

prior to 01.06.2015 to levy late filing fees u/s.234E of the Act. As regards

arguments of the ld. DR that correction statements have been filed after

01.06.2015 and intimations have been issued after 01.06.2015 and thus,

there is provision for levy of late fee u/s 234E of the Act, we find that

once, an assessee filed original quarterly TDS statements before

01.06.2015, then even if correction statements are filed after amendment

on 01.06.2015, there is no question of levy of late fee because law

provided for filing correction statements to rectify any mistakes in original

statements. Thus, we reject arguments of the ld. DR present for the

Revenue. We, therefore are of the considered view that late fee charged

u/s.234E of the Act, while processing quarterly TDS returns filed prior to

01.06.2015 is not sustainable under the law. Thus, we direct the

Assessing Officer to delete late fee charged u/s.234E of the Act.

Order pronounced on the 28th day of February, 2023, in Chennai.

Sd/- Sd/- (वी. दुगा� राव) (मंजूनाथा.जी) (MANJUNATHA.G) (V. DURGA RAO) लेखासद�य/ACCOUNTANT MEMBER �याियकसद�य/JUDICIAL MEMBER चे�ई/Chennai, �दनांक/Dated: 28th February, 2023. TLN

ITA Nos.88-92/Chny/2023 :: 6 :: आदेश क� �ितिलिप अ�ेिषत/Copy to: 1. अपीलाथ�/Appellant 4. आयकरआयु�/CIT 2. ��यथ�/Respondent 5. िवभागीय�ितिनिध/DR 3. आयकरआयु� (अपील)/CIT(A) 6. गाड�फाईल/GF