M/S. ANK ENGINEERS,INDORE vs. ITO-TDS-I, INDORE

Date of Hearing: 12.10.2020 Date of Pronouncement: 13.10.2020 आदेश / O R D E R PER MANISH BORAD: The above captioned 3 appeals are at the instance of assessee and is directed against the orders of Ld. Commissioner of Income Tax(Appeals)-I, Indore (in short ‘CIT(A)’)dated 31.01.2019.

ITANos.442 to 444/Ind/2019 Ank Engineers 2. Assessee has raised following grounds of appeal:- to 444/Ind/2019 Assessment Year 2012-13 (Qtr-2, Qtr-3 & Qtr-4)

1.That the learned CIT(A) erred in law and facts of the case and confirmed the late fees levied by Ld. A.O u/s 234E without considering the full facts and reasons of the case. 2.That the sub section (3) of the section 234E of the Act states that it shall be aid before delivering TDS statement. It means that any late fees should have been deposited just at the time of delivering TDS statement and not late than this. 3.That once the TDS statement has been accepted without late fees, than such late fees cannot be recovered later on. In view of the above, late fees cannot be recovered late on by way on any notice, no notice of demand us/ 146 can be issue for this. 4.Further, the section under which order has been passed i.e. 200(3) r.w.s. 234E of the Income Tax Act, 1961 in such section no such demand order can be passed by AOP. 5.The Ld. CIT(A) erred in charging late fees u/s 234E by statement issued u/s 200A while processing TDS statement since the enabling clause have been inserted w.e.f. 01.06.2015.

6. That the appellant craves to leave, add, alter or amend any grounds at or before hearing.

ITANos.442 to 444/Ind/2019 Ank Engineers raised in this two appeals is against the levy of fee u/s 234E of the Act by CPC for delay in filing the TDS quarterly returns and Ld. CIT(A) confirming such levy of fee u/s 234E at Rs. 26,983/- Rs.24,207/- and Rs. 9,800/- for Quarter-2, Quarter-3 and Quarter-4 respectively for Financial Year 2013-14. Quarterly returns were filed after the due date.

ITANos.442 to 444/Ind/2019 Ank Engineers 9. In the instant case the date of filing the quarterly return and their processing is before 1.6.2015, so in these given facts “whether the revenue authorities were justified in levying fee u/s 234E of the Act?”. We find that similar issue and same facts came up for adjudication before us in the case of Executive Engineer & others to 459/Ind/2019 order dated 26.7.2019 wherein we decided as follows (relevant extract) :-

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. 5

ITANos.442 to 444/Ind/2019 Ank Engineers 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 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.

15. From perusal of the above decision we find that the issue before us is similar to the issue adjudicated by the Coordinate Bench and we accordingly hold that the Ld. CIT(A) has rightly confirmed the levy of fee u/s 234E of the Act by the CPC, however we direct the revenue authorities to make necessary verification in each of the case so as to look into the fact that in case if any fee u/s 234E is levied for the delay in filing return for the period before 01.06.2015, the same is directed to be deleted and the remaining fee levied for the default committed from 01.06.2015 onwards needs to be confirmed.

ITANos.442 to 444/Ind/2019 Ank Engineers 10. In light of the above decision which squarely applies on the instant appeals since the issue and facts remain the same, we are thus of the considered view that the assessee is eligible for relief for deletion of fee levied u/s 234E of the Act as the returns are processed before 1.6.2015. 11. In the result all the 3 appeals of the assessee are allowed.

Order was pronounced in the open court on 13.10.2020.