M/S. OFFICE OF THE DISTRICT PROSECUTION OFFICER,DEWAS vs. ACIT (CENTRALIZED PROCESSING CELL-TDS), DEWAS

Brief facts common in all these appeals are that the appellant was required to file the statement of tax deducted at source for the respective quarter but failed to do so within the due date prescribed in the law for filing such quarterly TDS returns. As per the provisions of section 234E of the Act, fee for default in furnishing the statement is leviable if the statement of TDS are not delivered within the time prescribed in sub-section (3) of section 200 or the proviso to sub-section (3) of section 206C of the Act.

The revenue authorities have levied the late fees for default in furnishing the statement in the processing of statement of tax deducted at source prepared u/s 200A of the Act. Against the levy of late fee u/s 234E in the statement processed u/s 200A of the Act, appeal was preferred by the assessee(s) for respective quarters for the respective assessment years before Ld. CIT(A) pleading that before the amendment was brought in by the Finance Act, 2015 2 to 262 & 285,286/Ind/2019 District Prosecution Officer w.e.f. 01.06.2015, the revenue authorities were not having the power to levy the late fees u/s 234E of the Act in the statement processed u/s 200A of the Act.

However, assessee failed to succeed in all these appeals before Ld. CIT(A) and now are in appeals before the Tribunal raising the above referred common issue.

At the outset, Ld. counsel for the assessee vehemently argued supporting written submission made before Ld. CIT(A) contending that before 1.6.15 revenue authorities have no power to levy penalty u/s 234E of the Act in the order of processing TDS filed by the assessee.

Per contra Ld. Departmental Representative (DR) vehemently argued supported the orders of both the lower authorities.

We have heard the rival contentions and perused the record placed before us.

From perusal of the grounds we find that only one issue needs to be adjudicated as to whether the Revenue authorities were justified in levying the late fees u/s 234E of the Act while processing the statement of tax deducted at source u/s 200A of the Act after the amendment was brought in w.e.f. 01.06.2015 in the provisions of section 200A of the Act. The common fact in all these cases is that the date of filing TDS return as well as date of Centralized 3 to 262 & 285,286/Ind/2019 District Prosecution Officer Processing Centre (In short `CPC’) order is after 01.06.2015. We observe that recently Coordinate Bench of Jaipur in the case of Shri Uttam Chand Gangwal Vs ACIT in ITA No. 764/JP/2017 dated 23/01/2019 adjudicated the similar issue of levy of fee u/s 234E of the Act in the case where TDS return and the CPC order was passed after 01.06.2015. Following decision was rendered by the Coordinate Bench:

In the instant case, the assessee filed its TDS return in Form No. 26Q for the quarter ended 31st March, 2015 on 22nd July, 2015 and the same was processed and an intimation dated 30 July, 2015 was issued by the AO u/s 200A of the Act. Thus, both the filing of the return of income by the assessee and processing thereof has happened much after 1.6.2015 i.e, the date of assumption of jurisdiction by the AO u/s 200A(1)(C) to levy fees under section 234E of the Act. Even though the quarterly return pertains to quarter ended 31.3.2015, the fact remains that there is a continuing default even after 1.6.2015 and the return was actually filed on 22.07.2015. The said provisions cannot be read to say that where an assessee file his return of income for the period falling after 1.6.2015 and there is a delay on his part to file the return in time, he will suffer the levy of fees, however, an assessee who has delayed the filing of the return of income even pertaining to the period prior to 1.06.2015, he can be absolved from such levy even though there is a continuous default Shri Uttam Chand Gangwal, Ajmer Vs. ACIT, Ghaziabad on his part even after 1.6.2015. In our view, the AO has acquired the jurisdiction to levy the fees as on 1.06.2015 and therefore, any return filed and processed after 1.6.2015 will fall within his jurisdiction where on occurrence of any default on part of the assessee, he can levy fee so mandated u/s 234E of the Act. Therefore, irrespective of the period to 4 to 262 & 285,286/Ind/2019 District Prosecution Officer which the quarterly return pertains, where the return is filed after 1.6.2015, the AO can levy fee under section 234E of the Act. At the same time, in terms of determining the period for which fees can be levied, only saving could be that for the period of delay falling prior to 1.06.2015, there could not be any levy of fees as the assumption of jurisdiction to levy such fees have been held by the Courts to be prospective in nature. However, where the delay continues beyond 1.06.2015, the AO is well within his jurisdiction to levy fees under section 234E for the period starting 1.06.2015 to the date of actual filing of the TDS return. In light of the same, in the instant case, the levy of fees under section 234E is upheld for the period 1.06.2015 to the date of actual filing of the TDS return which is 22.07.2015 and the balance fee so levied is hereby deleted. In the result, the ground of appeal is partly allowed.

In the result appeals No. ITA/260 to 262/Ind/2019 & ITA/285 & 286/Ind/2019 are allowed for statistical purposes.