GURUNATH SHAMBHU VERNEKAR,PUNE vs. ITO, TDS-1, PUNE, PUNE

2. In the case of the assessee, an order u/s.200A of the Act, was passed on 02.10.2016 for Quarter-4 of Financial Year 2012-13 levying late fee u/s.234E of the Act of Rs.12,200/-. As per the said order, Assessee had filed Quarterly Statement on 15.07.2013. Assessee filed an appeal before ld.CIT(A) on 16.08.2024 with a delay of 2845 days. Ld.CIT(A) held that there was no sufficient cause for delay and hence dismissed the appeal. to 141/PUN/2025 [A] 2.1 Aggrieved by the order, Assessee filed appeal before this Tribunal.

Submission of ld.AR : 3. Ld.AR, Advocate Ashwini and CA-Sarang Gudhate filed a paper book. Ld.AR for the assessee relied upon the following case laws :  Collector Land Acquisition Vs. Mst. Katiji & Ors.  Sitaldas K. Motwani Vs. Director General of Income Tax  Jiji Varghese Vs. Income Tax Officer & Ors. (Kerala HC)

3.1 Ld.AR submitted that ITAT Pune in various cases has held that 234E late fee is applicable w.e.f. 01.06.2015. In the case of the assessee, Department has levied 234E late fee for the F.Y.2012-13 which is not sustainable as held by ITAT Pune. However, ld.CIT(A) has not condoned the delay. Ld.AR submitted that on merits, Assessee should get relief.

Submission of ld.DR : 4. Ld.DR for the Revenue relied on the order of the ld.CIT(A). The ld.DR relied on the order of Hon’ble Gujarat High Court in the case of Rajesh Kourani Vs. Union of India 297 CTR 502 (Gujarat), wherein Hon’ble Gujarat High Court has held as under : to 141/PUN/2025 [A] “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.” 4.1 Therefore, ld.DR for the Revenue supported order u/s.200A of the Act and ld.CIT(A)’s order.

Findings & Analysis : 5. We have heard both the parties and perused the records.

5.1 The issue involved in this case is whether late fee under section 234E can be levied for F.Y.2012-13. This issue is covered in favour of the assessee.

5.2 We are aware of the fact that there are contrary decisions on this issue. The Hon’ble Karnataka High Court in Fatheraj Singhvi Vs. Union of India 289 CTR 0602(Kar) held in favour of assessee as under : “23. In view of the aforesaid observation and discussion, since the impugned intimation given by the respondent-Department against all the appellants under Section 200A are so far as they are for the period prior to 1.6.2015 can be said as without any authority under law. Hence, the same can be said as illegal and invalid.

ITA Nos.136 to 141/PUN/2025 [A]

5.4 The Hon’ble Madras High Court in the case of Lingeshwara Creations Vs. PCIT [2024] 168 taxmann.com 383 held as under : “In the present case, the respondent had imposed the late fee only under Section 234E of the Act for the assessment years 2012-2013, 20132014. However, Section 200A of the Act was not introduced during the said assessment years and it was introduced only with effect from 01.06.2015. Therefore, in the absence of any provisions under Section 200A of the Act, the respondents ought not to have imposed late fee under Section 234E while processing the applications for TDS under Section 200A. Hence, in such view of the matter, this Court is of the opinion that the impugned Demand Intimation Letters are liable to be set aside.” 5.5 The Hon’ble Kerala High Court in the case of Amaravati Vs. ITO(TDS) [2022] 142 taxmann.com 81(Ker) has held as under : “7……………………….. to 141/PUN/2025 [A] Thus the jurisdiction to levy late fee under section 234E arises only from 1-06.2015 and not earlier.

8. As regards the contention on the delay, though the said contention was impressive on first blush, it can be seen that the nature of challenge raised by the petitioner is based upon the lack of jurisdiction of the respondents to impose late fee. Since in matters where total lack of jurisdiction is alleged, delay cannot be relied upon as a ground to deny the relief, this Court is of the view that the objections of the respondents are without any basis.”

5.6 Thus, Hon’ble Kerala High Court held that when there is no jurisdiction to levy late fee, the delay in filing appeal shall not be the ground for denying relief to the assessee. In the case under consideration, though there has been delay in filing appeal before ld.CIT(A), however, ld.CIT(A) was duty bound to condone the delay and decide the issue on merits as held by Hon’ble Kerala High Court. The substantial justice is more important than procedural delay.

5.7 We are aware that Hon’ble Gujarat High Court in the case of Rajesh Kourani Vs. Union of India(supra) has decided the issue in favour of the Revenue.

ITA Nos.136 to 141/PUN/2025 [A] 5.8 No direct decision on the impugned issue of the Hon’ble Jurisdictional High Court has been brought to our notice. In these facts and circumstances of the case, when there are contrary decisions of different Hon’ble High Courts, in the absence of decision of Hon’ble Jurisdictional High Court, the decision which is favourable to the assessee needs to be followed; as observed by the Hon’ble Supreme Court in the case of CIT Vs. Vegetable Products Limited [1973] 88 ITR 192 (SC). The decision of Hon’ble Karnataka High Court(supra) was followed by ITAT Pune Bench in the case of Medical Superintendent Rural Hospital, vs. DCIT, CPC(TDS) [2018] 100 taxmann.com 78.