SUN HOSPITLITY AND SERVICE APARTMENTS PRIVATE LIMITED,MUMBAI vs. ASSISTANT COMMISSIONER OF INCOME TAX CENTRAILZED PROCESSING CELL-TDS, MUMBAI

आदेश / O R D E R PER S. RIFAUR RAHMAN: This is an appeal filed by the assessee against the order of the Ld. CIT(A)-60, Mumbai dated 18.05.2018 for the A.Y 2015-16. 2. Brief facts of the case are that the assessee company filed its statements in Forms 24Q for Q1 to Q4 for F.Y 2014- 15 relevant to A.Y 2015-16. On verification of this . Sun Hospitality and Service Apartments Pvt Ltd., Mumbai. - 2 - statement, the AO noticed that the assessee filed the statement, belatedly and hence, raised a demand on account of late filing levy u/s 234E by issuing intimations u/s 200A.

of the assessee has dismissed the appeals.

3. Now, the assessee is in further appeals before your hounour as this issue is no longer re integra since the Hon’ble Karnataka High Court in Fatehraj Singhvi V. union of Inida (289 CTR 0602) has held that w.e.f 01.06.2015, the Parliament by way of an amendment to Sec. 200A of the Act, has empowered the AO to levy fee u/s 234E of the Act while processing u/s 200A of the Act.

4. Therefore, prior to that date i.e 01.06.2015, the AO had no authority to levy fee u/s 234E of the Act. Therefore, the AO erred in levying the fee u/s 234E of the Act which been wrongly confirmed by the Ld. CIT(A) and, therefore, the impugned orders of the Ld. CIT(A) need to deleted”.

7. At the time of hearing, none appeared on behalf of the assessee and this issue is in favour of assessee. Hence, taken up for disposal of the same by hearing the Ld. DR. Considered the submissions of the Ld. DR and perused the material on record. We find that similar issue came up for consideration before the coordinate bench of Hyderabad ITA No. 5322//Mum/2018. Sun Hospitality and Service Apartments Pvt Ltd., Mumbai. - 4 - Tribunal in the case of M/s Terra Infra Development Ltd., Hyderabad in & 1875/Hyd/2017 for AYs 2013-14 and 2014-15, order dated 03/10/2018 wherein the coordinate bench has held as under:

4. We find that though the provisions for levy of fee in certain cases has been brought into the Statute book w.e.f. 1.7.2012, it has been brought under the purview of section 200A only w.e.f. 1.6.2015. Therefore, as rightly held by the Coordinate Bench in the case of M/s. Sonalac Paintings & Coatings Ltd (cited Supra) we hold that the interest u/s 234E cannot be levied in respect of TDS returns filed prior to 1.6.2015. For the sake of ready reference, the relevant para is reproduced hereunder: "10. Now coming to the merits of the case, we find force in the argument of the learned Counsel for the assessee that prior to 01.06.2015, there was no mandate, as per the Statute, to make any adjustment on account of levy of fees u/s 234E while processing TDS returns u/s 200A. We have taken note of the order of the Hon'ble Gujarat High Court holding the amendment made to section 200A w.e.f. 01.06.2015, giving power to make adjustment on account of fees u/s 234E while processing returns u/s 200A to be retrospective in nature, stating that this power given to the AO is a machinery provision while the substantive provision of the power to levy fees u/s 234E was always there on the Statute from 01.06.2012. But at the same time, we note that the Hon'ble Karnataka High ITA No. 5322//Mum/2018. Sun Hospitality and Service Apartments Pvt Ltd., Mumbai. - 5 - Court held that levy of fees u/s 234E while processing returns, TDS u/s 200A prior to 01.06.2015 was without any authority of law. With two divergent view of the Hon'ble High Courts on the issue and in the absence of any decision by the jurisdictional High Court, we concur with the learned Counsel for the assessee that as per the well accepted rule of construction, if two reasonable constructions of a statute are possible the construction which favours the assessee must be adopted. In view of the same, respectfully following the decision of the Karnataka High Court in the case of Fatheraj Singhvi (Supra), we hold that the fees levied in all the present cases u/s 234E prior to 01.06.2015 in the intimations made u/s 200A was without authority of law and the same is therefore, directed to be deleted. In view of the above, all the appeals of the assessee stand allowed".

5. Respectfully following the same, assessee's appeals for both the A.Ys are allowed.” 7.1 In the case under consideration, on perusal of record, we find that the TDS returns filed by the assessee for the relevant period i.e., FY 2014-15 Quarter - 4 was prior to 01/06/2015. Therefore, respectfully following the said decision of the coordinate bench, we set aside the order of CIT(A) and direct the AO to delete the fees levied u/s 234E. . Sun Hospitality and Service Apartments Pvt Ltd., Mumbai. - 6 - 8. In the result, the appeal filed by the assessee is allowed.