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Facts
The appellant, Krishibhavan Andhoor, a unit of the Agricultural Department, Government of Kerala, filed its TDS statement for FY 2021-22 belatedly, leading to a late fee of Rs. 53,400 under Section 234E of the Income Tax Act. The appellant appealed to the CIT(A) citing accountant unawareness and TAN issues, but the CIT(A) dismissed the appeal, holding the levy of late fee under Section 234E as mandatory. The assessee subsequently filed appeals before the ITAT.
Held
The Income Tax Appellate Tribunal upheld the CIT(A)'s decision, stating that the levy of late fee under Section 234E of the Act is automatic and mandatory. The Tribunal clarified that Section 273B, which provides for 'reasonable cause', does not extend to the levy of late fees under Section 234E. Consequently, the Tribunal found no merit in the appeals and dismissed all of them.
Key Issues
Whether the levy of late fee under Section 234E for delayed filing of TDS statements is justified and mandatory, and whether 'reasonable cause' under Section 273B can exempt an assessee from such a levy.
Sections Cited
200A, 234E, 200(3), 273B
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Income Tax Appellate Tribunal, COCHIN BENCH
Before: SHRI INTURI RAMA RAO, AM & SHRI SOUNDARARAJAN K., JM
O R D E R Per: Inturi Rama Rao, AM These appeals filed by the assessee are directed against the orders of the National Faceless Appeal Centre, Delhi [CIT(A)] all dated 26.06.2024 for Assessment Years (AYs) 2022-23 & 2023-24. Since identical facts and issues are involved, these appeals are heard together and disposed of by the common order for the purpose of convenience.
746 to 249/Coch/2024 Krishibhavan Andhoor unit of the Agricultural Department, Government of Kerala, filed TDS statement for the first quarter of FY 2021-22 and the same was processed on 03.10.2022 u/s. 200A of the Income Tax Act, 1961 (the Act) and levied late fee of Rs.53,400/- u/s. 2334E of the Act for delayed filing of the TDS statements. The said late fee was levied at Rs. 200 per day from the due date for filing the TDS statement to the actual date of filing the TDS.
Being aggrieved by levy of late fee charges, an appeal was filed before the CIT(A) stating that the delay had occurred on account of unawareness of the Accountant, who was handling the tax matters and also on account of mistake in updating the TAN, etc. However, the CIT(A) dismissed the appeal by holding that levy of late fee as prescribed u/s. 234E of the Act is mandatory. Accordingly, the CIT(A) dismissed the appeal.
Being aggrieved, appellant is in appeal before us in the present appeal.
When the appeal was called nobody attended despite due service of notice of hearing. Therefore after hearing the learned Sr. DR, I proceeded to dispose the same.
The only issue arises for our consideration is whether the Income Tax Officer (TDS), Kannur (hereafter “the AO”) is justified in levying late fee u/s. 234E of the Act. The provisions of section 200(3) of the Act require a person to deliver a statement of tax deducted at 746 to 249/Coch/2024 Krishibhavan Andhoor source within the period specified therein. If the statement is not furnished within the due date, late fee on the tax deductible at source is charged as provided u/s. 234E of the Act. The levy of late fee is not saved by any reasonable cause as evident from the reading of the provisions of section 273B of the Act, which does not include the reasonable cause for levy of late fee u/s. 234E of the Act. Reasonable cause for delay cannot spare levy of late fee. In the present case no challenge was laid questioning the very levy of late fee. Therefore, on conjoinet reading of sections 234E and 273B, it would be clear that levy of late fee u/s. 234E of the Act is automatic and, therefore, we do not find any merit in the appeal filed by the appellant.