KUKUMINA CONSTRUCTIONS PVT. LTD.,BHUBANESWAR vs. ACIT, CPC, TDS, GHAZIABAD

Per Bench : These appeals arising out of intimation u/s.200A of the I.T.Act, 1961 issued by the CPC (TDS), Ghaziabad dated 16.10.2016 & 20.12.2016, respectively for the fourth quarter for the Assessment Year 2013-2014 & 2014-2015, against the levy of fee u/s.234E of the Act for late filing of quarterly TDS return and confirm by the CIT(A).

by the CPC, Ghaziabad dated 16.10.2016 imposing late fee of Rs.28,400/- for Quarter-4(26Q), Rs.28,400/- for Quarter-4(24Q) for assessment year 2013-2014 and vide demand notice dated 20.12.2016

levying late fee of Rs.29,200/- for Quarter-4(24Q) & Rs.29,200/- for Quarter-4(26Q) for the assessment year 2014-2015 u/s.234E of the Act, respectively. We further noticed that in the acknowledgement

there was no any failure on the part of the assessee has been shown i.e.

short payment, short deduction/collection, interest on payment default

u/s.201(1A)/206C(7) of the Act, interest on short payment, interest on late payment, interest on deduction/collection default u/s.201(1A)/

206C(7) of the Act, interest on short deduction/collection, interest on late deduction/collection. It is, therefore, amply clear that the assessee

had deducted TDS on the due amounts and it has been deposited to the Income Tax Department and there is merely a failure for late filing of quarterly TDS return for the Quarter-IV(24Q & 26Q). To support our [2019] 108 taxmann.com 294(Jodhpur-Trib.), wherein the coordinate

bench of the Tribunal at para 6 has observed as under :-

“6. In the light of the aforesaid decision and respectfully following the same, we note that it appears that in all matters, the intimation given by the AO which are given in purported exercise of power u/s. 200A are in respect of late fees u/s. 234E of the Act for the period prior to 01.06.2015. As such, it is on account of the intimation given making demand of the late fee in purported exercise of powers u/s. 200A of the Act. We note that clause (c) of sec. 200A of the Act empowers the AO to levy late fee was w.e.f. 01.06.2015 and there is no indication [which is either express or implied] while amendment was made that it is retrospective or clarifactory in nature. Since the AO is empowered to levy the late fee for late filing of the statement of TDS/TCS statement and in the Memorandom explaining the introduction of Finance Bill, 2015 clearly took note of the provisions of Chapter XVIIB under which the persons deducting tax i.e. deductor was required to file quarterly tax deduction at source, statements containing the details of deduction of tax made during quarterly by the prescribed due dates. (Similar responsibility is on the persons required to collect tax of certain specified receipt u/s. 206C of the Act). In order to provide effective deterrence against the delay in furnishing TDS/TCS statements, the Finance Act, 2012 inserted sec. 234E of the Act to provide for levy of fees on late furnishing of TDS statements. The Memorandum of Finance Bill, 2015, further took note of the fact that the Finance (No. 2) Act 2009, inserted sec. 200A in the Act, which prescribed for furnishing of TDS statements for determining the amount payable or refundable to the deductor. It further took note that however, as sec. 234E of the Act was inserted after the insertion of sec. 200A in the Act, the existing provisions of sec. 200A of the Act do not provide for determination of late fees payable u/s. 234E of the Act at the time of processing of TDS statement. It was thus, proposed to amend the provisions of sec. 200A of the Act so as to enable the computation of taxes payable u/s. 234E of the Act at the time of processing of TDS statement u/s. 200A of the Act. Taking note of the aforesaid legal history the Memorandum explaining Finance Bill, 2015 took note of the fact that at that time there does not exist any provision in the Act to enable the processing as TCS returns and hence, a proposal was made to insert a provision in this regard and also the post provision was incorporated the mechanism for computation of late fees payable u/s. 234E of the Act. Thus, we note that a perusal of the Memorandum explaining the insertion of provision relating to insertion of clause (c) to sec. 200A 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. Therefore, the AO is not empowered to levy late fees u/s. 234E of the Act before 01.06.2015. Therefore, in the light of the aforesaid discussion and the ratio laid by the Pune Bench in Maharastra Cricket Association (supra), we hold that the amendment [clause (c)] was inserted u/s. 200A of the Act which has been given effect from 01.06.2015 is prospective in nature, and no computation of late fee for the demand or the intimation for the late fee u/s. 234E could be made for the TDS deducted for the respective assessment years prior to 01.06.2015. Therefore, the intimation u/s. 200A of the Act by the AO, TDS for payment of late fee u/s. 234E of the Act for the respective assessment years prior to 01.06.2015 is without any authority of law. In the light of the aforesaid view, we set aside the order of the Ld. CIT(A) and remand the matter back to the file of AO with a direction to AO that the late fee levied for the period of delay of filing return prior to 01.06.2015 need to be deleted. We further clarify that the AO is well within his juri iction to levy late fee u/s. 234E of the Act for the period starting only from 01.06.2015 to the date of actual filing of the TDS return. In sum and substance, the levy of late fee u/s. 234E of the Act is valid from the period from 01.06.2015 to the date of actual filing of the TDS return and the balance fees levied earlier to 01.06.2015 is directed to be deleted.”

the AO to delete late fee of Rs.28,400/- for Quarter-4(26Q), Rs.28,400/-

for Quarter-4(24Q) in assessment year 2013-2014 and Rs.29,200/- for Quarter-4(24Q) & Rs.29,200/- for Quarter-4(26Q) u/s.234E of the Act

in assessment year 2014-2015, respectively. Accordingly, we allow the grounds raised by the assessee in all the appeals.

आदेशानुसार/ BY ORDER, (Senior Private Secretary) आयकर अपीऱीय अधिकरण, कटक / ITAT, Cuttack