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Income Tax Appellate Tribunal, MUMBAI BENCH “A”, MUMBAI
Before: SHRI SHAMIM YAHYA & SHRI PAVAN KUMAR GADALE
These appeals by the assessee are directed against the common order of learned Commissioner of Income Tax (Appeals)-59, Mumbai (in short ‘the CIT(A)’) dated 03.06.2019 wherein levy of late filing fees under Section 234E of the Income Tax Act, 1961 (in short ‘the Act’) has been confirmed as under :
2013-14 26Q-3 Rs. 49,540 2014-15 26Q-1 Rs. 98,560 2014-15 24Q-2 Rs. 77,060 2014-15 26Q-3 Rs. 56,320 2014-15 26Q-4 Rs. 50,690 2013-14 26Q-2 Rs. 42,800
The brief facts of the case are that the appellant, an individual, was the proprietor of a concern identified as ‘Imaginary Friend Pictures’ which was stated to be engaged in the business of production of advertisement films. The CPC Bangalore levied the aforesaid interest under Section 234E of the Act. The other aspects of the case emanating out of the submission of the assessee before the learned CIT(A) as are under :-
“2. The appellant vide letters dated 04.05.2019 and 15.05.2019 submitted that he was required to deduct tax at source on various payments made and, accordingly, he did so. Consequently, he was required to file the TDS return in Form 26Q for quarter-3 of the financial year 2012-13 on or before 15.01.2013. However, the same was filed on 26.07.2013. Due to the delay, the CPC-TDS levied late filing fee under section 234E of the Act Rs.38,400/-. It was stated that the same was bad in law since prior to 01.06.2015 there was no enabling section for levy of this late filing levy and, hence, the CPC-TDS was not so empowered. In other words, the appellant averred that the enabling provisions of section 234E are prospective in nature and not retrospective. Reliance was placed on the following : i) Concept Management Consulting Ltd. Vs DCIT (2016) 47 CCH 0710 Mum Trib. ii) Sibia Healthcare Pvt. Ltd. Vs. DCIT (2016) 46 ITR (Trib) 0453 (Amritsar) iii) Smt G Indhirani and Others Vs DCIT CPC-TDS(2015) 41 ITR (Trib) 0439 (Chennai) iv) Bapashri Mahotsav Smruti Trust Vs DCIT (2015) 45 CCH 0352 Ahd Trib v) Rajesh Kumar Kukreja Vs DCIT (TDS)(2017) 51 CCH 0577 Del Trib and vi) Gajanan Constructions vs CPC-TDS, (Pune-ITAT) vii) Disha Distributors, Mumbai Vs A.O TDS Wd Kalyan, ITA No. 4742/Mum/2016 viii) Foresight Holdings, Mumbai Vs DCIT (TDS) CPC, ITA No. 3938/Mum/2015 ix) Karunashkanakr Shukla, Kalyan Vs A.O TDS Kalyan ITA No. 4746/Mum/2016 x) PL Oswal & Co. Kalyan Vs A.O. A.O TDS Wd Kalyan ITA No. 4714/Mum/2016
3 to 5110/Mum/2019 Shri Aniket A. Shirke xi) Kash Realtors Pvt. Ltd. Vs ITO TDS 1(1)(3) ITA No. 4199/M/2015 xii) Kapoor Glass (India) Pvt. Ltd. Vs CIT TDS Ghaziabad ITA No. 4071/M/2015 xiii) Medical Engineers (India) Ltd. Vs CIT TDS Ghaziabad ITA No. 4072/M/2013 xiv) Roha Dry Chem Pvt. Ltd. Vs DCIT(TDS) ITA No. 2971, 2972, 2973/M/2013 xv) Diamond Ship Brokers Pvt. Ltd. Vs ITO TDS ITA No. 4127, 4128, 4129/M/2015 xvi) Bhoja Vittal Shetty Vs ITO 1(2)(1) Mumbai ITA No. 4127, 4128, 4129/M/2015 xvii) Hitesh Shankar Shetty Vs DCIT(TDS) CPC ITA No. 3962, 3963/M/2015 xviii) Bhaskar Krishna Shetty Vs DCIT(TDS) CPC ITA No. 3964, 3965/M/2015 xix) Dinesh Kumar S Gupta Vs Vs DCIT(TDS) CPC ITA No. 4088/M/2015 xx) Arpana Motars Pvt. Ltd. Vs Vs DCIT(TDS) CPC ITA No. 4175, 4176/M/2015
2.1 As regards the delay in filing of appeal, the appellant stated that he initially received the order under Section 200A on 01.09.2013 in which demands were raised on various grounds. Since, it was felt that the said demands were incorrect, he applied for rectification under Section 154 on various occasions. The appellant stated that on receipt of orders under Section 154 on 14.12.2018 and 05.04.2018, the only demand that remained outstanding was the late filing levy of Rs.38,400/-. Accordingly, the appeal was instituted within 30 days thereof on 30.04.2018 which was in time, more so since at sl. no. (9) of the CPC-TDS intimation, it was written that the same may be treated as notice of demand under Section 156 of the Act.
2.2 Without prejudice, the appellant requested condonation of delay if a view were to be taken that the appeal ought to have been filed within 30 days of receipt of initial order under Section 200A (and not under Section 154) of the Act. On the basis of the arguments as delineated above, the appellant prayed for the expunging of the late filing fee.”
From the above, it is evident that these appeals were filed before the learned CIT(A) relating to levy of interest under Section 234E of the Act. This 4 to 5110/Mum/2019 Shri Aniket A. Shirke was originally done by the CPC Bangalore vide order dated 01.09.2013 as these were not scrutiny assessment. Assessee filed a rectification application under Section 154 of the Act. Assessee’s application for rectification of mistake under Section 154 of the Act was rejected on 14.12.2018. Assessee appealed before learned CIT(A). Learned CIT(A) held that there was a delay in filing the appeals as under :-
Form A.Y/quarter First CPC Due date of Date of Delay No. intimation date filing appeal appeal filing (Days) 26Q 2014-15(Q-3) 27.08.2014 26.09.2014 02.05.2018 1314 26Q 2013-14(Q-3) 01.09.2013 01.10.2013 30.04.2018 1672 26Q 2014-15(Q-1) 07.08.2014 06.09.2014 27.04.2018 1329 26Q 2014-15(Q-2) 15.08.2014 14.09.2014 27.04.2018 1321 26Q 2014-15(Q-4) 02.12.2014 01.01.2015 02.05.2018 1217 26Q 2013-14(Q-2) 14.06.2013 14.07.2013 27.04.2018 1746 Learned CIT(A) was of the opinion that the delay was not to be condoned. After having not condoned the delay in filing the appeal against the original order, he further held that this is an appeal against order under Section 154 and not against the original order of processing of returns by CPC. Hence, the merits cannot be adjudicated. Even after the above observation he proceeded to adjudicate the merits and held as under :-
“4.6 Another argument urged was that the amendment in section 200A of the Act made from 01.06.2015 was ‘prospective’ and not ‘retrospective’. A catena of judicial authorities was pressed. However, this aspect is not relevant, given not only the delay in filing the appeals but academically, because the CPC-TDS under challenge intimations were all passed prior to 01.06.2015. This aspect might perhaps have required a discussion only if these had been passed on or after 01.06.2015, which is not the case here. Hence, the case laws cited by the appellant are extraneous to the issue at hand requiring no further analysis. These would include the two specific decisions referred to by the ld. Authorised Representative during the course
5 to 5110/Mum/2019 Shri Aniket A. Shirke of hearing on May 31, 2019, viz., those of Swami Vivekananda Vidyalaya vs ACIT, CPC-TDS (ITA 2386/PUN/2017) dated 21.12.2017 of the ld. Appellate Tribunal, Panji and that of the ld. Appellate Tribunal, Indore, in a bunch of appeals of the State Bank Group in ITA No. 727/Ind/2017 dated 13.11.2018, which are both on merits and, hence, not required to be discussed.
4.7 In the end, the position obtaining is that the appeals under consideration have nothing to do with section 154 of the Act. Even if this infirmity is overlooked and the appeals are treated to be filed under section 200A of the Act, these are hugely belated as tabulated above, for which no reasonable cause has been shown or established. For these reasons, the appeals are to be dismissed unadmitted.”
Against the order, assessee is in appeal before us.
We have heard both the parties and perused the record. As evident from the aforesaid facts narrated above, the crux of the matter was levy of fee/interest under Section 234E of the Act by the CPC, Bangalore. As evident from the case laws referred above, the enabling provision for levy of fee/interest was not in the statute books at that time and hence, the assessee filed a rectification application under Section 154 of the Act. The 154 application was rejected. Thereupon assessee filed appeal before the learned CIT(A). Learned CIT(A) did not condone the delay. In our considered opinion, the learned CIT(A) has erred in not condoning the delay pertaining to assessee’s appeal. The assessee was waiting for the outcome of application under Section 154 of the Act. This is a reasonable cause and the delay attributable to it deserves to be condoned. The learned CIT(A) by not condoning the same has erred. This is also when the adjustment was done by the CPC which was not permissible by the law in operation at that time. Hence, the delay ought to have been condoned. Hence, we set aside the order of learned CIT(A) and hold that delay ought to have been condoned. The 6 to 5110/Mum/2019 Shri Aniket A. Shirke learned CIT(A) has further erred as after noting that he is not condoning the delay in filing the appeal, he has gone on a different tangent saying that actually this appeal is against the order under Section 154 of the Act, hence the issue on merits cannot be adjudicated. Thereafter, the learned CIT(A) has further erred in going on to adjudicate the merits “academically” and rejecting the assessee’s appeal without dealing with the case laws submitted. In the interest of justice, we remit the issue to file of learned CIT(A). Learned CIT(A) is directed to decide the appeal on merits by passing a speaking order as per law. Needless to add, assessee should be granted opportunity of being heard.
In the result, these appeals by the assessee stand allowed for statistical purposes.
Order pronounced in the open court on 2nd June, 2021.