SRINIVASAMURTHY KOLIHALLY YALAKAIAH,BANGALORE vs. THE COMMISSIONER INCOME TAX (APPEALS)-10, BANGALORE

IN THE INCOME TAX APPELLATE TRIBUNAL BANGALORE BENCHES “ C ” BENCH: BANGALORE BEFORE SHRI A.K. GARODIA, ACCOUNTANT MEMBER AND SHRI PAVAN KUMAR GADALE, JUDICIAL MEMBER ITA Nos.1963 to 1965/Bang/2019 (Assessment Years : 2014-15, 2015-16 & 2016-17) Shri Srinivasamurthy Kolihally Yalakaiah, No.35/9, 11th Main Road, 4th Block, Jayanagar, Bangalore. ….Appellant PAN ABSPY 5499C Vs. Asst. Commissioner of Income Tax, CPC – TDS, Ghaziabad. ……Respondent.

Assessee By: None. Revenue By: Shri Tshering Ongda, Addl. CIT.

Date of Hearing : 22.06.2020 Date of Pronouncement : 26.06.2020

O R D E R : PER SRI PAVANKUMAR GADALE JM: These are the appeals filed by the assessee against common order of Commissioner of Income Tax (Appeals)-10, Bangalore passed under Section 154 and 250 of the Income Tax Act, 1961 ('the Act'). Since all the appeals have

2 ITA Nos.1963 to 1965/Bang/2019 common issues and identical to the facts of the case, accordingly are clubbed and heard together and consolidated order is passed. At the time of hearing, none appeared on behalf of the assessee nor adjournment petition was filed. The tribunal considering the material on record and submissions of the learned Departmental Representative heard the appeal. 2. For the sake of convenience, we shall take up the ITA No.1963/Bang/2019 and the grounds of appeal raised by the assessee are as under:

3 ITA Nos.1963 to 1965/Bang/2019 3. The Brief facts of the case are that the assessee is a proprietor, engaged in the business of Health and Fitness equipment sales and filed the Quarterly TDS Returns for the A.Y. 2014-15 relevant to F.Y. 2013-14 for Q1, Q2 & Q3.The returns were processed and the ACIT, CPC-TDS levied late filing fees under Section 234E of the Act for Q1 Rs.55,000/- Q2 Rs.36,500/- and Q3 Rs.18,100/- aggregating to Rs.1,09,600/-. The contentions of the assessee ,that the levy of late fees under Section 234E of the Act is illegal and relied on the decision of Hon'ble Karnataka High Court in the case of Sri Fatehraj Singh & Others Vs. UOI 289 CTR 602 (Kar), where it was held that the provisions of Section 200A(1) Clauses (c), (d) and (f) of the Act are effective from 1.6.2015 and therefore the intimation under Section 200A of the Act in respect of prior period to 1.6.2015 is without any authority under law and is not sustainable. Whereas the intimation under Section 200A of the Act for the Asst. Year 2014-15 was passed on 9.4.2014 and the assessee has filed rectification petition for the Q1, Q2 & Q3 and the CPC-TDS has passed order under Section154 of the Act dt.13.3.2019. Aggrieved by the order of rectification under Section 154 of the Act, the assessee has filed an appeal before the CIT (Appeals). Whereas the CIT (Appeals) observed that the assessee has filed an appeal against the order under Section 154 of the Act, challenging the levy of late fees under Section 234E of the Act which is not a mistake apparent from record, and also the decision of the Hon'ble Karnataka High Court in Sri Fatehraj

4 ITA Nos.1963 to 1965/Bang/2019 Singh & Others Vs. UOI (supra) is applicable prospectively and dismissed the appeal of the assessee. Aggrieved by the order of CIT (Appeals), the assessee has filed an appeal with the Tribunal. 4. We heard the learned Departmental Representative and perused the material on record. We found that the TDS Returns for the Q1, Q2 & Q3 for the F.Y. 2013-14 relevant to A.Y. 2014-15 were filed by the assessee and after processing the returns, the order under Section 200A of the Act was passed on 19.04.2014. Subsequently, the assessee has filed rectification petition against the said order. Whereas,the CPC TDS has passed order under Section 154 of the Act on 13.03.2019.Aggrieved with the order, the assessee has filed an appeal. Whereas, the CIT (Appeals) has dismissed the appeal observing that the decision of the Hon'ble Karnataka High Court in the case of Sri Fatehraj Singh & Others Vs. UOI (supra) is applicable prospectively and the levy of late fees under Section 234E cannot be challenged under Section 154 of the Act. 5. On the issue of filing of rectification petition by the assessee, the observations of the CIT (Appeals), that the assessee cannot challenge the levy of late fees under Section 234E under Section 154 of the Act. We found that the assessee received the order on 19.04.2014 for the A.Y. 2014-15 and has filed rectification petition with the CPC-TDS for correction of statements which is not disputed, and the same was processed and order under Section 154 of the Act was

5 ITA Nos.1963 to 1965/Bang/2019 passed by CPC TDS on 13.03.2019. Aggrieved by the order, the Assessee has filed an appeal under Section 246 of the Act with the CIT (Appeals). We found under provisions of Section 246(1)(c) of the Act, an order under Section 154 is appealable which is read as under :

“ 246(1) Subject to the provisions of sub-section (2), any assessee ;aggrieved by any of the following orders of an Assessing Officer (other than the Deputy Commissioner) may appeal to the Deputy Commissioner (Appeals) (before the 1st day of June, 2000) against such order – ….. (a) (b) (c) an order under section 154 or section 155 having the effect of enhancing the assessment or reducing a refund or an order refusing to allow the claim made by the assessee under either of the said sections;”

Considering the provisions of law and the facts of the case, we found the assessee has challenged the order under Section 154 of the Act, which is permissible under the Law. On the second issue of applicability of decision of Hon'ble Karnataka High Court in the case of Sri Fatehraj Singh & Others Vs. UOI (supra),the provisions of Section 200A(1)(c), (d) and (f) are effective from 1.6.2015 and Hon’ble court has held at Para 23 to 28 of the decision which is read as under

6 ITA Nos.1963 to 1965/Bang/2019

7 ITA Nos.1963 to 1965/Bang/2019

8 ITA Nos.1963 to 1965/Bang/2019

9 ITA Nos.1963 to 1965/Bang/2019

Considering the ratio of decision of Hon’ble jurisdictional High Court and the material on record. We Set-aside the order of CIT(Appeals) and direct the Assessing Officer to delete the levy of late fees under Section 234E of the Act and allow the grounds of appeal of the assessee.

10 ITA Nos.1963 to 1965/Bang/2019 7. In the result, the assessee appeals in ITA Nos. 1963 to 1965/Bang/2019 are allowed.

Pronounced in the open court on the date mentioned on the caption page.

Sd/- Sd/- (A.K. GARODIA) (PAVAN KUMAR GADALE) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated: 26.06.2020. *Reddy GP Copy to 1. The appellant 2. The Respondent 3. CIT (A) 4. Pr. CIT 5. DR, ITAT, Bangalore. 6. Guard File By order

Assistant Registrar Income-tax Appellate Tribunal Bangalore