SHANTILAL CHIMANLAL SHETH,MUMBAI vs. ACIT (TDS) - CPC, GHAZIABAD

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ITA 6447/MUM/2018Status: DisposedITAT Mumbai14 January 2020AY 2015-164 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that Section 200A was amended prospectively from June 1, 2015, and therefore, late fees under Section 234E could not be levied for TDS deducted prior to that date. The demand for late fees was without authority of law.

What were the facts?

The assessee filed a TDS return late for financial year 2014-15, paying the TDS and interest on time. The Assessing Officer levied late filing fees under Section 234E, which was confirmed by the CIT(A).

What were the issues?

Whether late filing fees under Section 234E are leviable for TDS deducted before the prospective amendment of Section 200A, and if the payment of TDS and interest in time negates the late fee.

Which sections of the Income-tax Act were involved?

Section 234E,Section 200A

AI-generated summary — verify with the full judgment below

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Income Tax Appellate Tribunal, MUMBAI BENCH “G”, MUMBAI

Before: Shri Pawan Singh (JM) & Shri S.Rifaur Rahman(A.M.)

For Respondent: Shri Vinod Kumar

O R D E R PER PAWAN SINGH, JM : 1. This appeal by assessee is directed against the order of CIT(A)-16, Mumbai dated 04-02-2018 for assessment year 2015-16. The assessee has raised the following ground of appeal:-

“l(a) On the facts and in the circumstances of the case and in law the learned Commissioner of Income Tax, Appeals [CIT (A)] erred in confirming the demand of Rs.27,800/- being late filing fees u/s 234E of Income Tax Act though the tax deducted at source was paid in time which was paid including interest on late filing and then the provisions of levying of late fees was not applicable. (b) On the facts and in the circumstances of the case and in law the learned Commissioner of Income Tax, Appeals [CIT (A)] erred in acknowledging the fact that the statutory provision of section 200 A was inserted by finance act 2015 w.e.f. 01/06/15 which was not retrospective in nature and hence the TDS statements filed prior to 01/06/15 did not 2 ITA 6447/Mum/2018 attract any late fee charges under section 234E of the Act in an intimation issued under section 200 A of the Act. (c) The learned CIT(A) failed to appreciate that there was merely a technical breach and hence the appellant should not be punished as is held in various judicial pronouncements. 2) On the facts and in the circumstances of the case and in law the learned CIT (A) erred in not giving any specific directions, to adjust the payment of Rs.22,730/-as intended to be adjusted as per specific payment per challan whereby it was paid.”

2.

The brief facts of the case are that the assessee booked a property under construction and made a part payment of Rs.2,52,53,000/- to the seller and paid TDS of Rs.2,52,530/- along with interest of Rs.22,730/-. The assessee filed TDS return in form 26-QB for financial year 2014-15 on 26-03-2015, against the due date for filing return on 07-11-2014. Thus, there was apparently a delay of 139 days. The assessee made TDS of Rs.2,52,530/- together with interest on 26-03-2015. Accordingly, the assessee paid the TDS with interest. The ACIT, Central Processing Cell (TDS), vide his order dated 02-02-2016, while processing the TDS Form 26QB, applied the provisions of section 200A levied a late fees of Rs.27,800/- under section 234. On appeal before CIT(A), the action of AO /CPCT was affirmed. Thus, further aggrieved, the assessee has filed the present appeal before us.

3 ITA 6447/Mum/2018

3.

None appeared on behalf of the assessee, despite the service of notice of hearing of the appeal. Even no application for adjournment was filed on behalf of assessee, thus, we left no option except to hear the submissions of the ld. departmental representative (DR) for the revenue and to decide the case on the basis of material on record. We have heard the submission of the Ld. DR for the revenue and perused the material available on record. The ld DR supported the order of lower authorities.

4.

The Ld. DR for the revenue supported the order of lower authorities. The Ld. DR submits that the Ld. CIT(A) has elaborately discussed the applicability of section 234E as well as section 200A of the Act. 5. We have considered the rival submissions of the parties and perused the material available on record. There is no dispute that the assessee made TDS on a booking with the seller and made part payment of property and made TDS of Rs.2,52,530/- and paid interest when return was filed on 26-02-2015. Admittedly, TDS was deducted prior to 01-06-2015. The Hon’ble Karnataka High Court in Fatheraj Singhvi Vs UOI reported viz (73 taxmann.com 252), wherein it was held that the amendment in section 200A has 4 ITA 6447/Mum/2018 come into effect on 01.06.2015 and has prospective effect, no computation of fee for the demand or the intimation for fee under section 234E can be made for TDS deducted prior to 01.06.2015, hence, the demand of fee under section 234E is without authority of law. Similar view was taken by this bench (by same combination) in Venus Electronics And Controls Pvt. Ltd Vs ITO (ITA No. 5073/Mum/2018 date 18.12.2019). In view of the aforesaid discussions, we find that no late fees were leviable on the assessee; therefore, the appeal filed by the assessee is allowed.

6.

In the result, appeal of the assessee is allowed.

Order pronounced in the open court on 14-01-2020.

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