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Income Tax Appellate Tribunal, MUMBAI BENCHES “G” MUMBAI
Before: SHRI RAJESH KUMAR, HON. & SHRI AMARJIT SINGH, HON.
PER RAJESH KUMAR, ACCOUNTANT MEMBER
These appeals by the assessee are directed against separate orders Commissioner of Income Tax (Appeals)-60, Mumbai, all dated 12/07/2018 for the A.Ys. 2014-15, 2014-15, 2014-15 & 2013-14 respectively. Since the facts and issues are common, therefore these appeals are clubbed and heard together and disposed of by way of this consolidated order.
The only common issue raised in all these appeals by the assessee is against the order of ld.CIT(A) who confirmed the late fee as imposed by the AO (TDS-CPC) u/s 234E of the Income Tax Act, 1961 (in short 'the Act') in respect of TDS returns filed after due date by the assessee but prior to 1.6.2015.
Facts of the case in brief are that for F.Y. 2013-14 relevant to the A.Y. 2014-15, the assessee has filed its TDS returns in respect of payments/credits on which assessee has deducted tax at source in the prescribed format, however, the said returns were filed after due date of filing of the returns. The said TDS returns were processed by the Central Processing Cell (CPC), Gaziabad and intimations u/s 200A of the Act were issued to the assessee wherein the late fee was imposed u/sec. 234E of the Act.
The details of the said levy are as under:-
Quarter Date of F.Y. A.Y. Late filing intimation fee u/sec. u/sec. 200A 234E (24Q-1) 23/09/2014 2013-14 2014-15 16,000/- (26Q-Q2) 23/09/2014 2013-14 2014-15 67,600/- (27Q-Q2) 31/03/2014 2013-14 2014-15 47,200/- (26Q-Q3) 23/09/2014 2013-14 2014-15 49,200/- (24Q-Q4) 23/09/2014 2013-14 2014-15 25,200/- (26Q-Q4) 29/07/2014 2013-14 2014-15 15,610/- (26Q-Q1) 86,000/- Total 3,06,810/- ld.CIT(A) challenging the order of the AO (TDS-CPC) dated 23/07/2014 for Quarter-4, 23/09/2014 for Quarter-3, 23/09/2014 for Quarter-2 and 19/12/2016 for Quarter-1. The ld.CIT(A) after considering the contentions and submissions of the assessee, dismissed the appeal of the assessee by holding the late fee was correctly levied even if the return were filed and processed prior to 01.06.2015.
Ld.AR ,while referring to the proviso to section 234E r.w.s.
200A of the Act, submitted before the Bench that the penalty / late fee levied by the AO (TDS-CPC) was wrong and against the provisions of the Act as the returns were filed and processed prior to the amendment carried out in section 200A w.e.f. 01/06/2015 by the Finance Act, 2015 by inserting new clauses (c) & (e) to sub-section (1) to section 200A of the Act . The ld.AR further submitted that only those returns were filed after the said date could be subjected to imposition of late fee u/s 234E of the Act and not to the cases filed prior to the said amendment.
Therefore, the ld counsel of the assessee submitted that intimations u/s 200A issued by the AO are beyond the scope and ambit of section 200A of the Act so far as relate to imposition of late fee u/s 234E of the Act and accordingly and late fee charged arguments, ld.AR submitted that amendment vide Finance Act, 2015 makes its clear that in absence of enabling the provisions of Sec. 200A of the Act ,levy of fee u/s 234E of the Act for TDS statements falling prior to 01/06/2015 is invalid. In support of his arguments, ld.AR relied on the following orders:-
Fatheraj Singhvi & Ors. Vs. UOI & Ors. [(2016) 73 taxmann.com 252 (Kar.)] 2. Sudarshan Goyal vs DCIT-(TDS) in dated 09/04/2018 (ITAT-Agra Bench) 3. Kamala Enterprises vs ITO-(TDS) in ITA No. 3324/MUM/2015 (ITAT – Mumbai Bench) 4. Kash Realtors Pvt. Ltd. & Anr. Vs ITO & Anr. [(2016) 47 CCH 523; and 5. Sree Ayyappa Educational Charitable Trust vs DCIT & Another in W.P.No.618/2015 c/w W.P. No. 5831 & 5990-6001/2015 (Karnataka – HC)
Ld.AR, therefore, prayed for the Bench that in view of the ratio laid down by the Hon'ble Karnataka High Court as stated above, the appeal of the assessee may kindly be allowed.
Ld.DR, on the other hand, relied on the orders of the authorities below and submitted that late fee is mandatory and the amendment carried out in section 200A w.e.f. 01/06/2015 does not bar imposition of such late fee even for those returns he prayed that the said order of the ld.CIT(A) may kindly be confirmed.
We have heard both the sides and perused the material available on record. It is undisputed fact that returns were filed for the A.Y. 2014-15 (F.Y. 2013-14) prior to the 01.06.2015 and were also processed prior to 01/06/2015. In our view, late fee could not be charged as the enabling the provisions of section 200A of the Act do not provide for the same. It is correct that the clauses (c) to (e) to sub-section (1) of section 200A brought on the statute took w.e.f. 01/06/2015 by the Finance Act, 2015.
Accordingly, we are of the view that the late fee as imposed by the AO (TDS-CPC) is wrong and consequent order upholding the said imposition by the ld.CIT(A) is also not correct. The case of the assessee is squarely covered by the series of decision referred to by the assessee. In the case of Sudarshan Goyal (supra) wherein the Coordinate Bench of this Tribunal has considered the decision passed by the Hon'ble Gujarat High Court in the case of Rajesh Kourani vs. UOI and the decision of Hon'ble Karnataka High Court in the case of Fatheraj Singhvi & Ors. (supra). The Coordinate Bench of this Tribunal has came to a conclusion that the decision of the Hon'ble Karnataka High Court which is in favour of the assessee is to be followed in view of the decision of the Hon'ble Supreme Court in the case of CIT vs. Vegetable Products Ltd. [88 ITR 192 (SC)]. In the case of Fatheraj Singhvi & Ors. (supra) the Hon'ble Karnataka High Court has held as under:-
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 200Afor computation and intimation for the payment of fee under Section 234£ 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 01/06/2015.
Another decision of Hon'ble Gujarat High Court in the case of Rajesh Kourani vs. UOI in Special Civil Application No. 302 of 2014 dated 20/06/2017 has ruled against the assessee by holding that 234E is charging section and section 234E is a constitutionally valid and there is no need or in absence of such specific mention in section 200A , late fee can be levied. Thereafter, the Hon'ble Karnataka High Court in the case of Sree Ayyapa Educational Charitable Trust (supra) upheld the view taken by the High Court in the earlier decision in the case of Fatheraj Singhvi & Ors.
(supra). Now, in our opinion, there are conflicting decisions on the same issue of various High Courts, the decision which are in the Hon'ble Supreme Court in the case of Vegetable Products Ltd. (supra). In our opinion, the Coordinate Bench of Agra Tribunal in the case of Sudarshan Goyal (supra) has correctly laid down the ratio considering the facts of the assessee’s case in the light of the above decisions. Accordingly, we are inclined to set aside the order of the ld.CIT(A) and direct the AO (TDS-CPC) to delete the late fee as levied u/s 234E of the Act.
ITA Nos.5686-5688/MUM/2018
We have already decided the issue under identical facts in favour of the assessee in and allowed the appeal of the assessee by directing the AO (TDS-CPC) to delete the levy of fee/penalty u/s 234E of the Act. Therefore, our decision in ITA No. 5685/MUM/2018 shall apply, mutatis mutandis, to these appeals also and accordingly we allow these appeals by directing the AO(TDS-CPC) to delete the late fee .