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Income Tax Appellate Tribunal, AHMEDABAD “C” BENCH
Before: Shri Rajpal Yadav & Shri Amarjit Singh
आदेश/ORDER
PER BENCH :-
These eight appeals filed by assessee for A.Y. 2015-16, arise from order of the CIT(A)-8, Ahmedabad dated 08-06-2016, in proceedings under section 200A of the Income Tax Act, 1961; in short “the Act”.
The assesee has raised following grounds of appeal:-
I.T.A Nos. 2756 to 2763/Ahd/2016 A.Y. 2015-16 Page No 2 Meldi Maa T.B. Hospital Trust vs. ACIT
ITA No. 2756/Ahd/2016 “1. The order passed u/s. 200A of IT Act by the Assessing Officer and confirmed by the first appellate authority charging fee U/s 234E of Income Tax Act is bad in law and deserved to be uncalled for. 2. The Assessing Officer as well as first appellate authority has erred in law and on facts in levying late filing fees of Rs. 19,500/- u/s. 234E of IT Act and confirming the same. The same deserves to be deleted.”
There are 8 appeals filed by the assessee pertaining to levy of fees u/s. 234E for delay in filing quarterly statements of deduction of taxes u/s. 200(3) for different quarter periods for assessment year 2015-16. As the identical issue involved in all the eight appeals of the assesse, therefore, ITA 2756/Ahd/2016 is being taken as lead case and its finding will be applicable to all the remaining appeals of the assessee.
Brief facts of the case is that assessee has filed quarterly statement of tax deducted at source for assessment year 2015-16 for Q-1 to Q-4 in form no. 26Q & Q-1 to Q-4 in form no. 24Q. The above statement was processed by the Asst. Commissioner of Income Tax Centralized Processing Cell TDS wherein TDS CPC has charged late filing fee of Rs. 19,500/- for quarter-1 of assessment year 2015-16 u/s. 234E of the act.
Aggrieved assessee filed appeal before the ld. CIT(A) stating that as per the law stood prior to first June, 2015, there was no enabling provision therein for raising a demand in respect of levy of fees u/s. 234E of the act. The ld. CIT(A) vide her order dated 08th June, 2016 has dismissed the appeal of the assesssee stating that assessing officer has rightly charged fees u/s. 234E of the act.
No one from the side of the assessee has attended during the course of appellate proceedings before us. On the other hand, the ld. departmental representative supported the order of the lower authorities and contended that the coordinate bench of the ITAT has decided the impugned issuein favour of the
I.T.A Nos. 2756 to 2763/Ahd/2016 A.Y. 2015-16 Page No 3 Meldi Maa T.B. Hospital Trust vs. ACIT
Revenue vide ITA No.2129 to 2143/Ahd/2016 dated 19/03/2018 in the case of EPT Exim Services Pvt. Ltd.
We have heard both the sides and perused the material on record carefully. The CPC had issued intimation u/s. 200A wherein fees u/s. 234E of the act was levied at Rs.19,500/-. We have noticed that the coordinate bench of the ITAT vide ITA No.2129 to 2143/Ahd/2016 dated 19/03/2018 in the case of EPT Exim Services Pvt. Ltd. has decided the identical issue in favour of the Revenue after following the decision of jurisdictional High Court of Gujarat in the case of Rajesh Kourani vs. Union of India (2017) 83 taxmann.com 137(Guj) wherein it is held that section 234E of the act is a charging provision creating a charge for levy of fess for certain default in filing statements and also held that the fees prescribed u/s. 234E could be levied even without a regulatory provision being found in section 200A for computation of fees. Rule 31A of IT rule laid down the time limit for filing quarterly statement for deduction of tax u/s. 200(3) of the act. Section 234F prescribes the charging of fees for every day default in filing of statement u/s. 200(3) of the act or any proviso to sub-section (3) of section 206 of the act. Section 200A pertained to processing of statement of tax deducted at source and prior to 01-06-2015 this provision did not include any reference of the fees payable u/s. 234E of the act. W.e.f. 1st June, 2015, this provision specifically provides for computing fees payable u/s. 234E of the act. The hon’ble jurisdictional high court of Gujarat in the case cited supra has held that when section 234E has already created a charge for levying fees, it would thereafter not have been necessary to have yet another provision creating the same charge. Even in absence of section 200A with introduction of section 234E, it was always open for the revenue to demand and collect the fees for late filing of the statement. The Hon’ble High Court has also held that section 234E is a charging provision and it was always open for the revenue to charge fees in terms of section 234E of the act even prior to 1st June, 2015. The relevant part of the decision of the hon’ble jurisdictional high court delivered in the case of
I.T.A Nos. 2756 to 2763/Ahd/2016 A.Y. 2015-16 Page No 4 Meldi Maa T.B. Hospital Trust vs. ACIT
Rajesh Kourani vs. Union of India (2017) 83 taxmann.com 137(Guj) is reproduced as under:- “16. We now come to the petitioner's central challenge viz. of non permissibility to levy fee under section 234E of the Act till section 200A of the Act was amended with effect from 01.06.2015. We have noticed the relevant statutory provisions. The picture that emerges is that prior to 01.07.2012, the Act contained a single provision in section 272A providing for penalty in case of default in filing the statements in terms of section 200 or proviso to section 206C. Such penalty was prescribed at the rate of Rs.100 for every day during which the failure continued. With effect from 01.06.2012, three major changes were introduced in the Act. Section 234E as introduced for the first time to provide for charging of fee for late filing of the statements. Such fee would be levied at the rate of Rs.200/- for every day of failure subject to the maximum amount of tax deductible or collectible as the case may be. Section 271H was also introduced for the first time for levying penalty for failure to furnish the statements. Such penalty would be in the range of Rs.10,000/- and Rs.1 lakh. No penalty would be imposed if the tax is deposited with fee and interest and the statement is filed within one year of the due date. With addition to these two provisions prescribing fee and penalty respectively, clause (k) of sub-section (2) of section 272A became redundant and by adding a proviso to the said section, this effect was therefore limited upto 01.07.2012. 17. In essence, section 234E thus prescribed for the first time charging of a fee for every day of default in filing of statement under sub-section (3) of section 200 or any proviso to sub-section (3) of section 206C. This provision was apparently added for making the compliance of deduction and collection of tax at source, depositing it with Government revenue and filing of the statements more stringent. 18. In this context, we may notice that section 200A which pertains to processing of statements of tax deducted at source provides for the procedure once a statement of deduction of tax at source is filed by the person responsible to do so and authorizes the Assessing Officer to make certain adjustments which are prima-facie or arithmetical in nature. The officer would then send an intimation of a statement to the assessee. Prior to 01.06.2015, this provision did not include any reference to the fee payable under section 234E of the Act. By recasting sub-section (1), the new clause-c permits the authority to compute the fee, if any, payable by the assessee under section 234E of the Act and by virtue of clause-d, adjust the said sum against the amount paid under the various provisions of the Act. 19. In plain terms, section 200A of the Act is a machinery provision providing mechanism for processing a statement of deduction of tax at source and for making adjustments, which are, as noted earlier, arithmetical or prima-facie in nature. With effect from 01.06.2015, this provision specifically provides for computing the fee payable under section 234E of the Act. On the other hand, section 234E is a charging provision creating a charge for levying fee for certain defaults in filing the statements. Under no circumstances a machinery provision can override or overrule a charging provision. We are unable to see that section 200A of the Act creates any charge in any manner. It only provides a mechanism for processing a statement for tax deduction and the method in which the same would be done. When section 234E has already created a charge for levying fee that would thereafter not been necessary to have yet another provision creating the same charge. Viewing section 200A as creating a new charge would bring about a dichotomy. In plain terms, the provision in our understanding is a machinery provision and at best provides for a mechanism for processing and computing besides other, fee payable under section 234E for late filing of the statements.
I.T.A Nos. 2756 to 2763/Ahd/2016 A.Y. 2015-16 Page No 5 Meldi Maa T.B. Hospital Trust vs. ACIT
Even in absence of section 200A of the Act with introduction of section 234E, it was always open for the Revenue to demand and collect the fee for late filing of the statements. Section 200A would merely regulate the manner in which the computation of such fee would be made and demand raised. In other words, we cannot subscribe to the view that without a regulatory provision being found for section 200A for computation of fee, the fee prescribed under section 234E cannot be levied. Any such view would amount to a charging section yielding to the machinery provision. If at all, the recasted clause (c) of sub-section (1) of section 200A would be in nature of clarificatory amendment. Even in absence of such provision, as noted, it was always open for the Revenue to charge the fee in terms of section 234E of the Act. By amendment, this adjustment was brought within the fold of section 200A of the Act. This would have one direct effect. An order passed under section 200A of the Act is rectifiable under section 154 of the Act and is also appealable under section 246A. In absence of the power of authority to make such adjustment under section 200A of the Act, any calculation of the fee would not partake the character of the intimation under said provision and it could be argued that such an order would not be open to any rectification or appeal. Upon introduction of the recasted clause (c), this situation also would be obviated. Even prior to 01.06.2015, it was always open for the Revenue to calculate fee in terms of section 234E of the Act. The Karnataka High Court in case of Fatheraj Singhvi (supra) held that section 200A was not merely a regulatory provision, but was conferring substantive power on the authority. The Court was also of the opinion that section 234E of the Act was in the nature of privilege to the defaulter if he fails to pay fees then he would be rid of rigor of the penal provision of section 271H of the Act. With both these propositions, with respect, we are unable to concur. Section 200A is not a source of substantive power. Substantive power to levy fee can be traced to section 234E of the Act. Further the fee under section 234E of the Act is not in lieu of the penalty of section 271H of the Act. Both are independent levies. Section 271H only provides that such penalty would not be levy if certain conditions are fulfilled. One of the conditions is that the tax with fee and interest is paid. The additional condition being that the statement is filed latest within one year from the due date.”
After considering the above facts and judicial findings, we do not find any merit in the appeal of the assessee ,therefore, respectfully following the decision of jurisdictional high court and the coordinate bench of the ITAT as mentioned supra, we dismiss both the grounds of appeals of the assessee.
In the result, all the eight appeals filed by the assessee are dismissed.
Order pronounced in the open court on 10-05-2018
Sd/- Sd/- (RAJPAL YADAV) (AMARJIT SINGH) JUDICIAL MEMBER ACCOUNTANT MEMBER Ahmedabad : Dated10/05/2018
I.T.A Nos. 2756 to 2763/Ahd/2016 A.Y. 2015-16 Page No 6 Meldi Maa T.B. Hospital Trust vs. ACIT
आदेश क� ��त�ल�प अ�े�षत / Copy of Order Forwarded to:- 1. Assessee 2. Revenue 3. Concerned CIT 4. CIT (A) 5. DR, ITAT, Ahmedabad 6. Guard file. By order/आदेश से, उप/सहायक पंजीकार आयकर अपील�य अ�धकरण, अहमदाबाद