BMG CALCUTTAWALA JEWELLERS PVT. LTD.,INDORE vs. AO CPC (TDS), ITO TDS(1) INDORE, INDORE

the order bearing Number ITBA/APL/S/250/2024- 25/1071072719(1) dated 10.12.2024 passed by the Ld. CIT(A) u/s 250 of the Act which is hereinafter referred to as the “Impugned order”. The relevant Assessment Year is 2013-14

EMG Calcuttawala Jewellers Pvt. Ltd - A.Y. 2013-14 and the corresponding previous year period is from 01.04.2012 to 31.03.2013.

2.2 The assessee is a private limited company duly incorporated under the companies Act, 1956 on 05.10.1998.

2.3 The main object of the company is to carry on the business of manufacturing and trading in gold bullion, ornaments and precious stones. The assessee is regularly assessed to the income tax since its inception.

2.4 The assessee had furnished its return of tax deducted at source (TDS) for the Quarter-IV of the financial year 2012-13 pertaining to the Assessment Year 2013-14 electronically in Form

EMG Calcuttawala Jewellers Pvt. Ltd - A.Y. 2013-14 No.24Q u/s 200(3) of the Act on 13.12.2013 vide Ack. No.

033810100174055.

2.5 That the assessee being aggrieved by the aforesaid “impugned intimation order” prefers first appeal u/s 246A of the Act before the Ld. CIT(A) who by the “impugned order” has dismissed the 1st appeal of the assessee on the grounds and reasons stated therein.

2.6 That the assessee being aggrieved by the “impugned order” has preferred the instant second appeal before this Tribunal and has raised following grounds of appeal in the Form No.36 against the “impugned order” which are as under:-

“1. That, the learned CIT(A) grossly erred, both on facts and in law, in upholding the levy of impugned late fee at Rs. 40,231/- under s.234E and charging of consequential interest under s. 220(2) at Rs.24,186/- of the Act, thereon resulting in an aggregate demand of Rs.64,417/-, through an Order under s.200A of the Act without considering the material fact that in an Order passed under s.200A, the levy of fee under s.234E was not permissible at the relevant time as the necessary amendment has been brought in the statute by the Finance Act, 2015 w.e.f. 01- 06-2015 only.

2. That, without prejudice to the above, the learned CIT(A) grossly erred in not appreciating the legal position that in absence of provisions of clauses (c) to (f) inserted in sub-section (1) of section 200A of the Act by the Finance Act, 2015 w.e.f. 1-6-2015, there was neither any authority, for the revenue, to collect any fees as provided under s.234E of the Act nor there was any right available to an assessee to prefer an appeal against charging of such levy. The Id. CIT(A) ought to have considered that having admitted the appeal of the assessee under s.246A(1)(a) of the Act, he had impliedly accepted the position that power to levy fees

EMG Calcuttawala Jewellers Pvt. Ltd - A.Y. 2013-14 under s.234E of the Act got emanated from the provisions of s.200A of the Act only.

3. That, without prejudice to the above, the learned CIT(A) grossly erred in not considering the legal position that under the provisions of section 234E of the Act, the fees was compulsorily required to be collectible from the deductor before delivering or causing to be delivered a statement in accordance with provisions of sub-section (3) of section 200 of the Act and no authority had been vested with the revenue authorities to collect any fees under s.234E of the Act after having been allowed an assessee to deliver his statement.

4. That, without prejudice to the above, the learned CIT(A) grossly erred in not considering the material fact that there was a reasonable cause for the appellant, for late submission of TDS statements within the time specified in sub-section (3) of section 200 of the Income-Tax Act, 1961 and consequently, no late fee under s.234E was leviable.

5. That, the appellant further craves leave to add, alter and/or amend any of the foregoing grounds of appeal as and when considered necessary”.

3. Record of Hearing 3.1 The hearing in the matter took place before this Tribunal on 19.11.2025 when the Ld. AR for and on behalf of the assessee appeared before us and has placed on record of this tribunal a paper book containing pages 1 to 41. The Ld. AR contended that levy of late fee of Rs.40,231/- is just not called for. In so far as interest of Rs.24,186/- he submitted that ground in this regard is not pressed. It was submitted that for Assessment Year 2013-14, Financial Year 2012-13 the late fee was not leviable. Hence

EMG Calcuttawala Jewellers Pvt. Ltd - A.Y. 2013-14 levy/demand is bad in law. Reliance was placed on the judgment and order of ITAT Indore in case of Shri Parasmal Parakh Prop.

Parakh Brothers, Rajgarh V/s ACIT, CPC-TDS, Ghaziabad reported in (2022)

31 ITJ online 550 (Tri.-Indore) wherein it was held that no late fee u/s 234E could be levied by the A.O in the intimation made u/s 200A of the Act for the period prior to 1st June, 2015. In the instant case at the material time and place there was no provision in law. Per contra Ld. DR has placed reliance on the “impugned order”.

4.1 We now have to decide the legality, validity and the proprietery of the “impugned order” basis records of the case and rival contentions canvassed before us.

4.2 We have carefully perused the records of the case as presented to this Tribunal by both the Ld. AR & the Ld. DR to determine the legality, validity of the “impugned order” basis law and by following the due process.

4.3 We basis records of the case and after hearing and upon examining the rival contentions are of the considered view that Page 5 of 27

EMG Calcuttawala Jewellers Pvt. Ltd - A.Y. 2013-14 the issue in the instant appeal is covered one that no late fee can be imposed u/s 234E of the Act for delay in filing of statements of TDS in Form No.24Q. Admittedly the statement relates to Quarter-4 of financial year 2012-13, Assessment Year 2013-14 and that the assessee is claiming that prior to 01.06.2015 there was no power/procedure in the Act for creating a demand of late fee against the assessee and it is only after insertion of clause(c) in Sub-Section (1) of Section 200A w.e.f. 01.06.2015 that the revenue got mandate in law to create a demand of late fee. We therefore hold that late fee cannot be imposed u/s 200A/234E of the Act as at material time and place i.e. filing of statements of TDS in Form 24Q for the assessment Year 2013-14 there was no provision in law. This issue besides above referred citation is also covered by our orders made in (Assessment Year 2013-14) in case of M/s Supreme Transport Co. V/s ITO TDS-II, Indore and we gainfully refer to para 6 to 10 as under:-

6. The assessee is aggrieved by the late fee imposed by AO u/s 234E for delay filing of Statements of TDS in Form No. 24Q. Admittedly, the Statements relate to Quarter-2 and Quarter-3 of Financial Year 2012-13 and the assessee is claiming that prior to 01.06.2015, there was no power/procedure in Income-tax Act,

EMG Calcuttawala Jewellers Pvt. Ltd - A.Y. 2013-14 1961 for creating demand of late fee against assessee and it is only after insertion of clause (c) in sub-section (1) of section 200A w.e.f. 01.06.2015 by Parliament through Finance Act, 2015 that the departmental authorities got power/procedure to create demand of late fee. Accepting this position of law in first round, the AO CIT(A) quashed the late fee levied by AO in the intimation u/s 200A. However, the AO has now passed order under different provisions of law, viz. section 200(3) r.w.s. 234E creating demand of late fee. The assessee’s contention, however, remains that prior to 01.06.2015, the department had no authority to create demand of late fee, not even in section 200(3) r.w.s. 234E. The CIT(A) has rejected this claim of assessee by relying upon a decision of Hon’ble Gujrat High Court in Rajesh Kourani v. UOI [2017] 83 taxmann.com 137/249 Taxman 402 (Guj.) wherein it has been held that the even in absence of section 200A, it was always open to the revenue to demand and collect fee because there existed liability under section 234E.

7. We find that the ITAT, Delhi Bench has passed a detailed order dealing identical issue in Franchise India Brands Ltd. Vs. CPC-TDS (2020 122 taxmann.com 196 (Delhi – Trib.). We extract the complete order passed by ITAT: “ R.K Panda, Accountant Member. - This batch of three appeals filed by the assessee are directed against the separate orders of the CIT(A)-30, New Delhi dated 10-1-2019 confirming the levy of late filing fee u/s 234E by the AO.

2. The ld. Counsel for the assessee, referring to the decision of the Delhi Bench of the Tribunal in the case of Udit Jain v. ACIT, vide [IT Appeal No. 5380(Del) of 2017, dated 11-12- 2019] and batch of other appeals, order dated 29-11-2019, he submitted that the Tribunal has thoroughly discussed the issue and held that when the period of default was before 1-6-2015, there is no merit in charging late filing fee u/s 234E of the Act. Referring to various other decisions of the coordinate Benches of the Tribunal, he submitted that the Tribunal has taken the view that levy of fee u/s 234E cannot be levied on such kind of default before 1-6-2015. He accordingly submitted that all these appeals filed by the assessee should be allowed and the levy of fee u/s 234E by the AO which has been sustained by the CIT(A) should be deleted.

EMG Calcuttawala Jewellers Pvt. Ltd - A.Y. 2013-14

4. The ld. DR, on the other hand, strongly supported the order of the CIT(A). She submitted that the common issue in all these appeals under consideration is levy of fees u/s 234E of the Act. She submitted that the contention of the assessee that fee u/s 234E is not leviable before 1-6-2015, i.e., the date when clause (c) was inserted in section 200A(1) for the computation of the said fees at the time of processing is not correct. She submitted that the decisions of the Tribunal relied on by the ld. Counsel are not applicable since the facts are largely distinguishable. The Tribunal has not appreciated the rationale of the amendments brought in the form of insertion of section 234E by the Finance Act, 2012 and insertion of clause (c) to Sec. 200A(1) of the I.T. Act by Finance Act 2015 as well as the decisions of various High Courts including jurisdictional High Court. The rationale behind such amendments & explanatory notes are available in the respective Memorandum to the corresponding Finance Bill which have not been considered by Hon'ble ITAT in its order dt.29-11-2019. She drew the attention of the Bench to the relevant provisions of I.T. Act viz. Sec.234E, Sec.200A(l), 271H, Memorandum to Finance Bill, 2012, Memorandum to Finance Bill'2015 alongwith host of case-laws decided in favour of Revenue. She submitted that the premise/foundation of the decision of Hon'ble Karnataka High Court has also been analysed and is distinguishable in view of the case-laws referred to. Accordingly she urged that the above decision dated. 29-11- 2019 should not be followed in the name of rule of consistency in the case of above mentioned appeals as also res-judicata is not applicable in income-tax proceedings.

5. As regards 'Rule of consistency' is concerned, she placed reliance on the decision of jurisdictional High Court in the case of Krishak Bharati Co-operative Ltd. v. Dy. CIT [2012] 23 taxmann.com 265/210 Taxman 123/[2013] 350 ITR 24 (Delhi) wherein Hon'ble Delhi HC considered the decision of Hon'ble Supreme Court in the case of Radhasoami Satsang v. CIT (1992] 60 Taxman 248/193 ITR 321 (SC) and has held that the rule of consistency should not create anomaly. She also relied on the following decisions:-

(i) Rohitasava Chand v. CIT [2008] 171 Taxman 147/306 ITR 242 (Delhi) (ii) Anup Sharma v. Addl CIT [IT Appeal No. 161(Chd.) of 2012, dated 10-9-2014] (iii) Meeraj Estate & Developers v. Dy. CIT [2014] 44 taxmann.com 431/148 ITD

EMG Calcuttawala Jewellers Pvt. Ltd - A.Y. 2013-14

166 (ITAT, Agra) (iv) K.K. Khullar v. Dy. CIT [2009] 116 ITD 301(Delhi) (v) Dwarkadas Kesardeo Morarka v. CIT [1962] 44 ITR 529 (SC)

7. She further drew the attention of the Bench to the Memorandum to the Finance Bill, 2015 which elaborates the rationale for insertion of clause (c) in section 200A(I) in the statute. Para (I) & para (III) under the heading "L Rationalization of Measures " which are relevant to the issue.

8. She also drew the attention of the Bench to the provisions of Section 271H of the Act which was simultaneously inserted with the provisions of section 234E w.e.f. 1-7-2012 by the Finance Act, 2012. She submitted that the applicability & interpretation of the provisions of sec. 271H have been discussed by various High Courts in its order while examining the validity of provisions of Sec. 271H.

EMG Calcuttawala Jewellers Pvt. Ltd - A.Y. 2013-14 consideration before Hon'ble High Courts included the period prior to 1-6-2015. The ld. DR relied on the following decisions:-

(i) Rajesh Kourani v. UOI [2017] 83 taxmann.com 137/249 Taxman 402 (Guj.) (ii) Biswajit Das v. UOI [2019] 103 taxmann.com 290/264 Taxman 41/413 ITR 92 (Delhi) (iii) Qatalys Software Technologies (P) Ltd. v. UOI, [2020] 115 taxmann.com 345/272 Taxman 119 (Mad.) (iv) Dundlod Shikshan Sansthan v. UOI [2015] 63 taxmann.com 243/235 Taxman 446 (Raj.) (v) Rashmikant Kundalia v. UOI [2015] 54 taxmann.com 200/229 Taxman 596/373 ITR 268 (Bom.) (vi) Lakshminirman Bangalore (P.) Ltd. v. Dy. CIT [2015] 60 taxmann.com 144/234 Taxman 275 (Kar.) (vii) Sree Narayana Guru Smaraka Sangam Upper Primary School v. UOI [2017] 77 taxmann.com 244/245 Taxman 312/392 ITR 457 (Ker.) (viii) Dr. Amrit Lal Mangal v. Union of India [2015] 62 taxmann.com 310/235 Taxman 410 (Punj. & Har.)

10. The ld. DR submitted that a harmonious and conjoint reading of provisions of section 234E & Memorandum to Finance Bill, 2012, Section 271H, section 200 A(1)(c), Memorandum to Finance Bill 2015 and the case-laws on this issue makes following points unambiguously clear that:

(a) The fee payable u/s 234E is a charging provision and the AO has no discretion at all whereas section 200A is a machinery provision enabling for processing of TDS statements, computation of adjustments, fees and generation of intimation etc. Hon'ble ITAT has not appreciated this obvious difference in its order dt. 29-11-2019, referred supra. (b) As apparent from the heading of the section 200A as well as the Memorandum to the Finance Bill,

EMG Calcuttawala Jewellers Pvt. Ltd - A.Y. 2013-14

2015 which elaborates the rationale for insertion of clause (c) in section 200A(1) in the statute it is absolutely clear that this is merely an enabling section to compute/process the TDS Statement. Section 234 E is the charging section imposing liability of payment of fee by the defaulting deductors as per its sub-section (3) as even in the absence of section 200A of the Act with introduction of section 234E, it was always open for the revenue to charge the fees in terms of section 234 E of the Act from the date of its introduction in the statute i.e. 1-7-2012. It may be noted that section 234.E creates an automatic charge on the deductors who have defaulted on this count & who are required to pay the fee u/s 234E before delivering such belated TDS/TCS returns/statements in accordance with sub-section (3) of sec. 234E. By amendment [introduction of clause 200A(1)(c)] this adjustment was brought within the fold of section 200A of the IT Act so that the fee u/s 234E can be computed at the time of processing & issue of intimation in the event of non-payment of fee before delivering such belated TDS/TCS statements by the defaulting deductors. Any view that inhibits the levy of fees under section 234 E due to the absence of regulatory provision will tantamount to charging section yielding to machinery provision which should not be allowed. This has not been considered by Hon'ble ITAT. (c) Section 200A entails the procedure for procedure for processing of TDS returns. Amended section of 200A (1)(c), with effect from 01/06/2015, enables computation of fees chargeable u/s 234E under the purview of 200A. Therefore, if any TDS return is processed after 01/06/2015, then fees chargeable u/s 234E is required to be computed as per section 200A(1)(c) by virtue of the fact that the charging section was already effective since 01/07/2012. Similar will be the scenario if TDS return with default of being delayed is submitted after 01/06/2015 and processing is done thereafter. Since the charging section was already effective on the date of occurrence of default (i.e. the due date filing of TDS return on which TDS return was Page 11 of 27

EMG Calcuttawala Jewellers Pvt. Ltd - A.Y. 2013-14 not filed), any TDS return processed after introduction of clause 200A(1)(c) (i.e. giving effect to computation of fees u/s 234E of the Act) should include computation of fees under section 234E. This also needs consideration by Hon'ble ITAT. (d) Section 200A speaks about the processing of TDS return/statements and thus the provisions starts only after the filing of such TDS returns/statements, whether in time or delayed, whereas section 234E seeks to levy the fees for the period of delay in filing such TDS returns and statements. Therefore, it may be seen that the charging provisions of section 234E precedes the operation of the machinery provisions of section 200A. Hon'ble ITAT has not appreciated this obvious difference in its order dt. 29-11-2019, referred supra. (e) The fee payable u/s 243E is compensatory in nature to the department for the services provided for regularization of the delay in filing of a TDS return/statement & is not penal in nature since the Income-tax Department has to expend extra effort & resources for processing delayed TDS returns or statements and also the additional burden of interest to be paid on refunds payable to the assessee on whose account tax deduction has been made. [As held in para 27 by Hon'ble Delhi High Court in the case of Biswajit Das (supra)] that the fee imposed u/s 234E of the Act is for all intents & purposes a 'late fee' payable for accepting TDS statement/return at belated point of time. This fact has not been considered by Hon'ble ITAT in its order dt.29-11-2019. (f) Section 271H of the Act does not provide for any penalty for delayed filing of TDS return/statement if a person proves that he has paid the TDS amount and also filed TDS statements along with fee and interest before expiry of a period of 1 year from the prescribed time. However, the delay in filing of TDS return/statement upto a period of 1 year from the prescribed time is subject to levy of fee u/s 234E. The penalty leviable u/s 271H of the Act is not automatic whereas the fees leviable u/s 234E is mandatory and the AO has no discretion.

EMG Calcuttawala Jewellers Pvt. Ltd - A.Y. 2013-14

These are two independent provisions and the findings of Hon'ble High Courts in this regard may kindly be referred to. The same have not been considered by Hon'ble ITAT. (g) Before the insertion of clause (c) to section 200A(1), section 200A did not provide for computation of fee payable u/s 234E of the Act at the time of processing of TDS statements though the same was mandatorily leviable for the delay in filing of TDS statements. In this sense, insertion of clause (c) to section 200A(1), is only an addendum to the section to provide for the machinery provision to compute the fee payable u/s 234E at the time of processing of TDS statement and the same is enabling for processes in nature. This is very much evident on perusal of the Memorandum to the Finance Bill 2015. The same have not been considered by Hon'ble ITAT.

11. The ld. DR submitted that as per various judicial decisions the ratio is that the legislations which modified accrued rights or imposed disabilities were to be treated as prospective in nature unless they were accounting for an obvious omission, or explaining a former legislation. In the present case, section 200(3) provides for statutory liability for depositing the TDS and furnishing the requisite statement with in due time (the said provision inserted by Finance Act 2004 w.e.f. 01/04/2005). Section 234 E which provides for levy of fees if assessee is in violation of 200(3) or 206C(3) of the Act, is inserted by F.A.2012 w.e.f. 01/07/2012 .Therefore, since both the substantive legislation (section imposing statutory liability as well as the charging section for levy of fees in case of violation of statutory liability) were in effect much earlier from the date of insertion of 200A(3) which is merely a mechanical provision providing for computation, such amendment in procedural section should be considered as clarificatory in nature. The same have not been considered by Hon'ble ITAT.

12. She submitted that in the case of Rajesh Kourani, Hon'ble Gujarat High Court has considered the chargeability of fee u/s 234E before 1-6-2015 when clause (c) was inserted to section 200A(1) by the Finance Act, 2015. Hon'ble High Court also considered the decision of Hon'ble Karnataka High Court in the case of Fatehraj Singhvi & Others. The issue has been discussed in great detail in para 16 to 21 and Hon'ble High Court has Page 13 of 27

EMG Calcuttawala Jewellers Pvt. Ltd - A.Y. 2013-14 upheld the levy of fee u/s 234E since the day the provisions of section 234E was brought to statute and even prior to 1-6-2015 when section 200A(1) was amended to include clause (c). Hon'ble High Court has held that section 200A of the Act is a machinery provision providing mechanism for processing a statement of IDS and for making adjustments whereas section 234E is a charging provision creating a charge for levying fee for certain defaults in filing the statements. W.e.f 1-6-2015 the provision of section 200A specifically provides for computing the fee payable u/s 234E. On this issue, specific reference may kindly be made to para 18, 19 & 20 of the order where specific findings of Hon'ble High Court are recorded. The categorical findings of Hon'ble Gujarat High Court, though considered by Hon'ble ITAT in its order dt 29-11-2019, has not been appreciated by Hon'ble Tribunal in right perspective when read in conjunction with the provisions, explanatory notes and orders of various other High Courts wherein the validity of provisions of sec.234E has been upheld.

13. She submitted that the issue of legality of intimations/orders passed u/s 200A levying fee u/s 234E for late filing of TDS/TCS returns/statements, prior to the amendments made by Finance Act'2015 w.e.f. 1-6-2015, was considered by Hon'ble Rajasthan High Court also in the case of Dundlod Shikshan Sansthan(supra). Para-8 of the order is relevant & the same is reproduced as under :- "8. In the present case, the fee was levied under section 200for late filing of the returns, prior to the amendments made by the Finance Act, 2015 with effect from 1-6-2015 in Sections 200A, 246A and 272A providing for computation and appeal. We do not find that even prior to these amendments the imposition of fee was illegal. We do not in exercise of the power under Article 226 of the Constitution of India find any valid reasons or jurisdiction to interfere with the compensatory fees imposed for late filing of the TDS returns on flat rates. The absence of any provision for condonation of delay and the appeal prior to amendments also did not make the imposition of late fees by Section 234 E to be ultra vires."

14. The findings of Hon'ble Rajasthan High Court has also escaped the consideration by Hon'ble ITAT. She accordingly requested that the same may kindly be considered to avoid any miscarriage of justice.

EMG Calcuttawala Jewellers Pvt. Ltd - A.Y. 2013-14 taxmann.com 337/183 ITD 334 (JP.-Trib). 2. Government Secondary School Principal Officer v. ACIT [IT Appeal No. 964 (JP) of 2019, dated 24-6-2020]

15. The ld. DR submitted that on a perusal of the order it may be noted that Hon'ble Karnataka High Court set-aside the order levying the fee u/s 234E holding that the amendments in sec 200A, wherein the clause (c) was inserted, can't have any retrospective application. However, two important points can be noted in the order. First Hon'ble Court didn't gave any such findings which can be said to have negated the mandatory charging of fees u/s 234E for late filing of TDS/TCS returns/statements which creates an automatic charge on the deductors who have defaulted on this count & who are required to voluntarily pay the fee u/s 234E before delivering such belated TDS/TCS returns/statements in accordance with sub- section (3) of sec. 234E. Second, Hon'ble Karnataka High Court left the question of constitutional validity of sec.234E open for consideration by the Division Bench [Para-26 of the order] which was earlier decided by Single Member Bench of the High Court upholding the validity of sec. 234E in the case of Lakshminirman Bangalore (P.) Ltd. [cited supra]. It is reiterated at the cost of repetition that the issue of constitutional validity of sec. 234E has been upheld by various High Courts including the jurisdictional High Court of Delhi and Punjab & Haryana High Court. Relevant case-laws have been mentioned above. The decision of Hon'ble Delhi High Court Biswajit Das [cited supra] is subsequent to the date of order of Hon'ble Karnataka High Court in the case Fatehraj Singhvi (supra) and accordingly, the decision of in the case Fatehraj Singhvi v. Union of India [W.P. Appeal Nos. 2648 to 2653 of 2015, dated 26-8-2016] which has been relied upon by Hon'ble ITAT in its order dt.29-11-2019, does not hold ground for consideration.

16. On perusal of the decisions of various High courts wherein the constitutional validity of provisions of sec. 234E have been upheld, it may be seen that in several cases the period under consideration before Hon'ble High Courts were even the periods prior to 1-6-2015 i.e. the date when clause (c) was inserted to section 200A(1) by the Finance Act, 2015. Having considered the periods prior to 1-6-2015 & having upheld the validity of sec. 234E by Hon'ble High Courts, it can't be said that the controversy, being raised now, has escaped the eyes of Hon'ble

EMG Calcuttawala Jewellers Pvt. Ltd - A.Y. 2013-14 High Courts and therefore there can't be any doubt that there is any iota of ambiguity with respect to the period of default for which the fee u/s 234E is chargeable. In view of the same and categorical findings of Hon'ble High Courts, the fee u/s 234E is undoubtedly leviable for the defaults of period in filing TDS/TCS statements/returns, even for the period prior to 1-6-2015 independent to the provisions of Sec.200A(1) of the Act. The same have not been considered by Hon'ble ITAT.

by the assessee should be allowed.

19. We have considered the rival arguments made by both the sides, perused the orders of the AO and the CIT(A) and the paper book filed on behalf of the assessee. We have also considered the various decisions cited before us. We find, the assessee, in the instant case has basically challenged the levy of late fee u/s 234E by the AO which has been upheld by the CIT(A).

20. A perusal of the order of ld. CIT(A) shows that all these TDS statements were filed before 1-6-2015, therefore, the question that has to be considered is as to whether the CIT(A) was justified in confirming the levy of late fee u/s 234E for delay in filing of the TDS statements and interest u/s 220(2) of the IT Act, 1961. We find, identical issue had come up before the coordinate Bench of the Tribunal in the case of Udit Jain (supra). The Tribunal, after considering the decision of the Hon'ble Karnataka High Court in the case of Fatehraj Singhvi (supra) as well as the decision of the Hon'ble Gujarat High Court in the case of Rajesh Kourani (supra), has decided the issue in favour of the assessee by observing as under:-

EMG Calcuttawala Jewellers Pvt. Ltd - A.Y. 2013-14

'9. We have heard the rival contentions and perused the record. The issue which needs to be adjudicated in these appeals is the charging of late filing fee u/s 234E of the Act while issuing the intimation u/s 200A of the Act. The case of the assessee before us is that where the legislature has inserted clause (c) to section 200A(1) of the Act w.e.f 1-6-2015, then in respect of the TDS statements which were filed under the respective sections of the Act, for the period prior to 1-6-2015, no late filing fee could be charged u/s 234E of the Act, in the intimation issued u/s 200A of the Act. We find that the said issue has been adjudicated by the Hon'ble Karnataka High Court in Fatehraj Singhvi & Others v. Union of India (supra), which proposition has been applied by the Pune Bench of the Tribunal in Medical Superintendent Rural Hospital, DOBI BK v. DCIT (supra). The Tribunal had also taken note of the decision of Hon'ble Gujarat High Court in Rajesh Kourani v. Union of India (supra) and applying the proposition that where there was difference of opinion between Hon'ble High Courts on a particular issue and in the absence of any decision rendered by the Jurisdictional High Court, then the decision in favour of the assessee needs to be followed as held by Hon'ble Supreme Court in Vegetables Products Ltd. [1973] 88 ITR 192(SC). The relevant findings of the Tribunal are as under:- 11. "We have heard the rival contentions and perused the record. The issue arising in the present bunch of appeals is against levy of late filing fees under section 234E of the Act while issuing intimation under section 200A of the Act, in the first bunch of appeals. The second bunch of appeals in the case of Junagade Healthcare Pvt. Ltd. is against order of Assessing Officer passed under section 154 of the Act rejecting rectification application moved by assessee against intimation issued levying late filing fees charged under section 234E of the Act. The case of assessee before us is that the issue is squarely covered by various orders of Tribunal, wherein the issue has been decided in respect of levy of late filing fees under section 234E of the Act, in the absence of empowerment by the Act upon Assessing Officer to levy such fees while issuing intimation under section 200A of the Act. The Tribunal vide order dated 21- 9-2016 with lead order in & 561/PN/2016, 1018/PN/2016 to 1023/PN/2016 in Maharashtra Cricket Association v. DCIT (CPC)-TDS, Ghaziabad, relating to assessment years 2013-14 and 2014-15 for the respective quarters deliberated upon the issue and held as under:- "34. Accordingly, we hold that the amendment to section 200A(1) of the Act is procedural in nature and in view thereof, the Page 17 of 27

EMG Calcuttawala Jewellers Pvt. Ltd - A.Y. 2013-14 Assessing Officer while processing the TDS statements/returns in the present set of appeals for the period prior to 1-6-2015, was not empowered to charge fees under section 234E of the Act. Hence, the intimation issued by the Assessing Officer under section 200A of the Act in all these appeals does not stand and the demand raised by way of charging the fees under section 234E of the Act is not valid and the same is deleted. The intimation issued by the Assessing Officer was beyond the scope of adjustment provided under section 200A of the Act and such adjustment could not stand in the eye of law."

EMG Calcuttawala Jewellers Pvt. Ltd - A.Y. 2013-14 prescribed, the provisions may also be vulnerable. All such aspects will be required to be considered before one considers regulatory mechanism or provision for regulating the mode and the manner of recovery and its enforceability as retroactive. If at the time when the fee was provided under section 234E, the Parliament also provided for its utility for giving privilege under section 271H(3) that too by expressly put bar for penalty under section 272A by insertion of proviso to Section 272A(2), it can be said that a particular set up for imposition and the payment of fee under section 234E was provided but, it did not provide for making of demand of such fee under section 200A payable under section 234E. Hence, considering the aforesaid peculiar facts and circumstances, we are unable to accept the contention of the learned counsel for respondent-Revenue that insertion of clauses (c) to (f) under section 200A(1) should be treated as retroactive in character and not prospective.

22. It is hardly required to be stated that, as per the well established principles of interpretation of statute, unless it is expressly provided or impliedly demonstrated, any provision of statute is to be read as having prospective effect and not retrospective effect. Under the circumstances, we find that substitution made by clause (c) to (f) of sub-section (1) of Section 200A can be read as having prospective effect and not having retroactive character or effect. Resultantly, the demand under section 200A for computation and intimation for the payment of fee under section 234E could not be made in purported exercise of power under section 200A by the respondent for the period of the respective assessment year prior to 1-6-2015. However, we make it clear that, if any deductor has already paid the fee after intimation received under section 200A, the aforesaid view will not permit the deductor to reopen the said question unless he has made payment under protest."

EMG Calcuttawala Jewellers Pvt. Ltd - A.Y. 2013-14 section 200A of the Act which was brought on Statute w.e.f. 1-6- 2015. The said amendment was held to be prospective in nature and hence, notices issued under section 200A of the Act for computation and intimation for payment of late filing fees under section 234E of the Act relating to the period of tax deduction prior to 1-6-2015 were not maintainable and were set aside by the Hon'ble High Court. In view of said proposition being laid down by the Hon'ble High Court of Karnataka (supra), there is no merit in observations of CIT(A) that in the present case, where the returns of TDS were filed for each of the quarters after 1st day of June, 2015 and even the order charging late filing fees was passed after June, 2015, then the same are maintainable, since the amendment had come into effect. The CIT(A) has overlooked the fact that notices under section 200A of the Act were issued for computing and charging late filing fees under section 234E of the Act for the period of tax deducted prior to 1st day of June, 2015. The same cannot be charged by issue of notices after 1st day of June, 2015 even where the returns were filed belatedly by the deductor after 1st June, 2015, where it clearly related to the period prior to 1-6- 2015.

17. Before parting, we may also refer to the order of CIT(A) in relying on the decision of Hon'ble High Court of Gujarat in Rajesh Kourani v. Union of India (supra). On the other hand, the learned Authorized Representative for the assessee has pointed out that the issue is settled in favour of assessee by the Hon'ble High Court of Karnataka in the case of Fatheraj Singhvi v. Union of India(supra). Since we have already relied on the said ratio laid down by the Hon'ble High Court of Karnataka, the CIT(A) has mis-referred to both decisions of Hon'ble High Court of Karnataka and Hon'ble High Court of Gujarat; but the Page 20 of 27

EMG Calcuttawala Jewellers Pvt. Ltd - A.Y. 2013-14 CIT(A) has failed to take into consideration the settled law that where there is difference of opinion between different High Courts on an issue, then the one in favour of assessee needs to be followed as held by the Hon'ble Supreme Court in CIT v. M/s. Vegetable Products Ltd. (supra), in the absence of any decision rendered by the jurisdictional High Court. The Hon'ble Bombay High Court in Rashmikant Kundalia v. Union of India [2015] 54 taxmann.com 200 (Bom) had decided the constitutional validity of provisions of section 234E of the Act and had held them to be ultra vires but had not decided the second issue of amendment brought to section 200A of the Act w.e.f. 1-6-2015. In view thereof, respectfully following the ratio laid down by the Hon'ble High Court of Karnataka and Pune Bench of Tribunal in series of cases, we delete the late filing fees charged under section 234E of the Act for the TDS returns for the period prior to 1-6-2015.

18. Further before parting, we may also refer to the order of CIT(A) in the case of Junagade Healthcare Pvt. Ltd., where the CIT(A) had dismissed appeals of assessee being delayed for period of December, 2013 and July, 2014. The CIT(A) while computing delay had taken the date of intimation under section 200A of the Act as the basis, whereas the assessee had filed appeals before CIT(A) against the order passed under section 154 of the Act. The CIT(A) had noted that rectification application was filed in February, 2018 which was rejected by CPC on the same day. The CIT(A) was of the view that there was no merit in condonation of delay, wherein appeals were filed beyond the period prescribed. The assessee had filed appeals against the order passed under section 154 of the Act, hence the time period of appeals filed by assessee before the CIT(A) have to be computed from the date of order passed under section 154 of the Act and not from the date of issue of intimation. Thus, there is no merit in the order of CIT(A) in dismissing the appeals of assessee on this issue.

EMG Calcuttawala Jewellers Pvt. Ltd - A.Y. 2013-14 section 154 of the Act. The said application for rectification under section 154 was filed on 8-06-2017/09- 3-2017 in the respective years. The said application was decided by the Assessing Officer on 9-06-2017. The assessee filed an appeal against the dismissal of the rectification application filed under section 154 of the Act. The said fact is clear from the perusal of Form No. 35 with special reference to Column 2(a) and 2(b). In the entirety of the above said facts and circumstances, we find no merit in the order of CIT(A) in the case of Medical Superintendent Rural Hospital, Surgana in dismissing the appeal in-limine being filed beyond the period of limitation. We have already decided the issue on merits in favour of assessee."

raised by assessee in all appeals are allowed."

10. The Delhi Bench of Tribunal in Meghna Gupta v. ACIT (supra) has also laid down similar proposition and held as under:- 6. "We have heard the rival submissions and also perused the relevant finding given in the impugned orders as well as material referred to before us. At the outset, from the perusal of the rectification order u/s 200A generated by TDS (CPC), it is noticed that the TDS in 26QB mentions date of filing of 'challan cum statement' as 5-4-2014, wherein late filing of 'challan cum statement' u/s 234E has been levied. The assessee had purchased the property on 6-12-2013 i.e., relevant to the assessment year 2014-15. Since assessee had purchased the property from eight sellers and the payment to each of the seller has been made separately for an amount of Rs. 41,87,500/- aggregating to Rs. 3,35,00,000/-, the assessee' contention has been that it was not required to deduct TDS, because the payments made to each seller was less than the prescribed limit of Rs. 50 lacs and therefore, provision of section 194IA was not applicable. The demand has been raised by the department u/s 200 in terms of failure to comply with Section 200A, which deals with the processing of statement of tax deducted at source u/s 200. First of all, sub section 3 of section 200 provides that the person deducting any sum in accordance with provision of chapter XVII shall after paying the tax deducted to the credit of the Central Government within the prescribed time, prepare such statement for such period as may be prescribed. Provision of section 200A provides that where the statement of tax deduction at source has been made by the person deducting any sum u/s 200, then such statement shall be processed in the manner given

EMG Calcuttawala Jewellers Pvt. Ltd - A.Y. 2013-14 therein. Clause (c) of section 200A has been substituted by the Finance Act 2015 w.e.f. 1-6-2015 which reads as under:- "(c) the fee, if any, shall be computed in accordance with the provisions of section 234E;" 6.1. Fee for default u/s 234E provides that, when a person fails to deliver or cause to be delivered a statement within the time prescribed u/s 200(3), then that person shall be liable to pay fee in the manner provided therein. Thus, fee u/s 234E is leviable if the statement is not filed as prescribed u/s 200(3) which in turn provides that the statement to be filed after the payment of tax to the prescribed authority. The relevant rule 31A(4A) provides that for filing of the 'challan cum statement' within seven days from the date of deduction. Now here in this case the demand has been raised purely on the ground that statement has not been furnished for the tax deduction at source. As stated above, the assessee has duly deposited the tax not at the time of purchase albeit on 5-4-2014 and on the same date, statement has also been filed. The relevant provision of section 200(3) read with rule 31A (4A) only refers to filing of 'challan cum statement' after the tax has been paid. The word "challan" in the said rule indicates that the tax must stand paid and that is how form 26QB is generated. Thus, here in this case, it cannot be held that there is any violation of section 200(3). In any case, the levy of fee u/s 200A in accordance with the provision of section 234E has come into the statute w.e.f. 1-6-2015. Since the challan and statement has been filed much prior to this date, therefore, no such tax can be levied u/s 200A. This has been clarified and held by Hon'ble Karnataka High Court in the case of Fatheraj Singhvi & Ors v. Union of India reported in [2016] 289 CTR 0602, wherein the lordship had made following observations :- "14. We may now deal with the contentions raised by the learned counsel for the appellants. The first contention for assailing the legality and validity of the intimation under section 200A was that, the provision of Section 200A(1)(c), (d) and (f) have come into force only with effect from 1-6-2015 and hence, there was no authority or competence or jurisdiction on the part of the concerned Officer or the Department to compute and determine the fee under section 234E in respect of the assessment year of the earlier period and the return filed for the said respective assessment years namely all assessment years and the returns prior to 1-6-2015. It was submitted that, when no express authority was conferred by the statute under section 200A prior to 1-6-2015 for computation of any fee under section 234E nor the determination thereof, the demand or the intimation for the Page 23 of 27

EMG Calcuttawala Jewellers Pvt. Ltd - A.Y. 2013-14 previous period or previous year prior to 1-6-2015 could not have been made."

(i) Prakash Industries Ltd. v. DCIT [IT Appeal Nos.5865 to 5869 (Delhi) of 2016, dated 29-7- 2019];

EMG Calcuttawala Jewellers Pvt. Ltd - A.Y. 2013-14

(ii) Ajvin Infotech (P.) Ltd. v. Dy. CIT [IT Appeal Nos. 2305 & 2306 (Delhi) of 2017, dated 4-3-2020]; (iii) D.D. Motors v. Dy. CIT [2019] 111 taxmann.com 493 (Delhi-Trib); and (iv) District Health & Welfare Society v. ITO [IT Appeal No. 7473 (Delhi) of 2018, dated 26-4-2019].

(a) Provisions of section 234 E are constitutionally valid (b) Rule of consistency is not applicable and (c) Late of fee u/s. 234 E is leviable for defaults of period in filing the TDS/TCS statements/returns even for the period prior to 1-06-2015.

EMG Calcuttawala Jewellers Pvt. Ltd - A.Y. 2013-14 Court has decided the issue against the assessee and in favour of the revenue. After considering the above conflicting decisions, the coordinate benches of the Tribunal are taking the view that when there are conflicting decisions, the decision in favour of the assessee should be followed in the light of decision of Hon'ble Supreme Court in the case of Vegetables Products Ltd. (supra). In the light of the above discussion we hold that the CIT(A) is not justified in confirming the late fee levied by the AO u/s. 200 A r.w.s. 234E since the defaults are prior to 1-6-2015. Accordingly we set aside the order of the Ld. CIT(A) and the fee levied u/s. 234 E and interest there on u/s. 220 (2) is directed to be deleted.

8. Thus, the ITAT, Delhi has considered several decisions including the decision of Rajesh Kourani (supra) relied by CIT(A). Finally, the ITAT has held that there is a judicial controversy on the issue and there being no decision of jurisdictional High Court of Delhi, the assessee was given benefit of favourable view following the decision of Hon’ble Supreme Court in Vegetable Products Ltd.

9. The Ld. Representatives of parties have not reported any decision of Hon’ble jurisdictional High Court of Madhya Pradesh on the issue. Therefore, the present appeal stands at parity with the case before ITAT, Delhi. Hence, respectfully following the view taken by ITAT, Delhi in above case, we too hold that the CIT(A) is not justified in confirming the late fee levied by the AO since the defaults are prior to 1-6-2015. We may also mention here that the section 234E only prescribes for levy of late fee and section 200(3) prescribes for filing of Statement of TDS. These two provisions, namely section 234E and 200(3), do not contain any provision to enable or empower the AO to create demand of late fee. Accordingly, we set aside the order of the Ld. CIT(A) and the fee levied u/s. 234E is hereby deleted.

4.4 In view of the premises drawn up by us, we set aside the “impugned order”. Page 26 of 27 EMG Calcuttawala Jewellers Pvt. Ltd - A.Y. 2013-14

5.2 In result the appeal of the assesse is partly allowed.

Order pronounced in open court on 27.11.2025.