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Income Tax Appellate Tribunal, “A” BENCH : BANGALORE
Before: SHRI ARUN KUMAR GARODIA & MS. BEENA PILLAI
IN THE INCOME TAX APPELLATE TRIBUNAL “A” BENCH : BANGALORE BEFORE SHRI ARUN KUMAR GARODIA, ACCOUNTANT MEMBER AND MS. BEENA PILLAI, JUDICIAL MEMBER
ITA Nos. 2904 to 2916/Bang/2018 Assessment Years : 2013-14 & 2014-15 M/s. Atlas Brands Pvt. Ltd., The Assistant No. 14A, 14B, Commissioner of Singasandra Village, Begur Vs. Income Tax (TDS- Hobli, CPC), Bangalore – 560 068. Ghaziabad. PAN: AAACA7262M APPELLANT RESPONDENT
Assessee by : Shri Ashok Kulkarni, Advocate Revenue by : Shri Praveen Karanth, Addl. CIT (DR)
Date of hearing : 19.06.2019 Date of Pronouncement : 21.06.2019
O R D E R Per Bench All these 13 appeals are filed by the assessee and these are directed against separate orders of ld. CIT(A)-3, Bangalore all dated 01.08.2018 arising in the proceedings initiated by the AO u/s. 154 in respect of charging of interest u/s. 220(2). All these appeals were heard together and are being disposed of by way of this common order for the sake of convenience.
In course of hearing, it was submitted by ld. AR of assessee that in all these cases, originally demand was raised for late filing fees u/s. 234E of IT Act in respect of late filing of various TDS returns. He submitted that against these demands raised by the AO u/s. 234E, assessee has not filed any appeal before CIT(A) but has filed revision petition before learned CIT u/s. 264 of IT Act on 09.01.2019 and the same are still pending before CIT. He submitted that later on, the AO initiated proceedings u/s. 154 of IT Act and raised demand of interest u/s. 220(2) for non-payment of late filing fees levied by the AO u/s. 234E. He submitted that as per the appeal filed before the CIT(A),
ITA Nos. 2904 to 2916/Bang/2018 Page 2 of 4 the assessee has raised objection against levy of late filing fees u/s. 234E as well as the assessee raised objection against levy of interest u/s. 220(2) of IT Act. But as per the impugned order of CIT(A), he has decided the issue regarding the demand raised by the AO in respect of late filing fees u/s. 234E of IT Act. But ld. CIT(A) has not decided the issue regarding levy of interest by the AO u/s. 220(2) of IT Act. He submitted that under these facts, the order of CIT(A) should be set aside and the matter may be restored back to his file for decision about levy of interest u/s. 220(2) of IT Act. The ld. DR of revenue supported the order of CIT(A).
We have considered the rival submissions. We find that although the separate orders are passed by ld. CIT(A) in respect of these appeals but his orders are identical and hence, we reproduce para no. 4.2 from the order of CIT(A) in ITA No. 2904/Bang/2018. The same is as under. “4.2 The submissions of the appellant have duly been considered. A perusal of the records as well as submissions of the appellant clearly shows that demand of Rs 9,930/- related to late filing fee under Section 234E of the Act and consequent interest under Section 220(2) of the Act was raised by the AO while passing order under Section 200A of the Act and not through the order under Section 154 of the Act. Since no such demand relating to late filing fee under Section 234E of the Act or under Section 220(2) of the Act has been raised in the order under Section 154 of the Act, so the relevant order which was required to be challenged in appeal for levy of late filing fee and consequent interest under Section 220(2) of the Act was the order under Section 200A of the Act and not the order under Section 154 of the Act. Vide the order under Section 154 of the Act the AO has only re-computed the demand on account of 'Interest payable on late payment', on the basis of correction statement filed by the appellant and no fresh demand related to late filing fee under Section 234E of the Act or consequential demand under Section 220(2) of the Act has been raised by the AO. Since the demand of Rs 9,930/- has not been raised vide order under Section 154 of the Act, so the grounds of appeal of the appellant are dismissed.” 4. From the above para reproduced from the order of CIT(A), it is seen that he has decided the issue on this basis that as per the order passed by the AO u/s. 154, no fresh demand related to late filing fee u/s. 234E of IT Act or consequential demand u/s. 220(2) of IT Act has been raised by the AO and therefore, the grounds of appeal of the assessee are dismissed. We examined the facts of the present case and we found that as per the original intimation passed by the AO u/s. 200A of IT Act on 02.10.2016, demand
ITA Nos. 2904 to 2916/Bang/2018 Page 3 of 4 raised was of Rs. 28,838.24/- on account of Short Deduction / Collection, Rs. 12,492/- on account of interest on late payment, Rs. 12,341/- on account of Interest on short deduction / collection and Rs. 11,800/-, on account of late filing fee u/s. 234E, total of Rs. 65,470/-. As per the second order passed by the AO u/s. 154 on 20.11.2017, the demand raised is only Rs. 9,930/- which includes demand of Rs. 1,218/- being interest u/s. 220(2) and Rs. 8,711/- being late filing levy u/s. 234E of IT Act after reducing Rs. 3,089/- from original demand of Rs. 11,800/- u/s 234E as per the earlier order dated 02.10.2016. This levy of interest of Rs. 1,218/- u/s. 220(2) of IT Act is a new levy in the order u/s. 154 passed by the AO and therefore, ld. CIT(A) should have decided the issue regarding charging of interest u/s. 220(2) of IT Act but as per the impugned order, he has not done so. Hence, we feel it proper to set aside the order of CIT(A) and restore the matter back to his file for a decision on this aspect which has been raised by assessee before him as per ground no. 4 raised before CIT(A) which is reproduced hereinbelow. “As the order passed raising the demand is bad in law, the appellant is not assessee in default and therefore AO has erred in levying interest under section 220(2) of the act.”
We order accordingly and set aside the order of CIT(A) and restore the matter back to his file for fresh decision in the light of above discussion after providing adequate opportunity of being heard to both sides.
It was agreed by both sides that the facts in dispute in all the appeals are similar and in all these appeals, ld. CIT(A) has not decided the issue regarding charging of interest u/s. 220(2) of IT Act in respect of late payment/nonpayment of levy of late filing fees u/s. 234E of IT Act because in all these cases, the final demand raised by the AO u/s. 154 is regarding levy of late filing fees u/s. 234E and levy of interest u/s. 220(2) of such late filing fees. Hence we set aside all the orders of CIT(A) and restore the matter back to his file for fresh decision with same directions because we find that in all the orders passed by the AO u/s. 154 of IT Act, the final demand raised by him is in respect of levy of late filing fees u/s. 234E of IT Act and interest u/s. 220(2) of IT Act in respect of late payment/nonpayment of levy of late filing fees u/s. 234E of IT Act. This was the ground raised by assessee before
ITA Nos. 2904 to 2916/Bang/2018 Page 4 of 4 CIT(A) that since the order passed by the AO raising demand of late filing fees u/s. 234E of IT Act is bad in law, the AO has erred in levying interest u/s. 220(2) of IT Act and this issue has not been decided by CIT(A). We direct the CIT(A) to decide the issue by way of a speaking and reasoned order in all these cases after providing adequate opportunity of being heard to both sides preferably after disposal by CIT of the assessee’s revision petition filed before learned CIT u/s. 264 of IT Act on 09.01.2019 because if the levy u/s 234E is deleted by CIT u/s 264, then there will be no liability for any interest u/s 220 (2) and if the same is not deleted then only the validity of levy of interest u/s 220 (2) may be confirmed as consequential.
In the result, all the 13 appeals filed by the assessee are allowed for statistical purposes. Order pronounced in the open court on the date mentioned on the caption page.
Sd/- Sd/- (BEENA PILLAI) (ARUN KUMAR GARODIA) Judicial Member Accountant Member Bangalore, Dated, the 21st June, 2019. /MS/ Copy to: 1. Appellant 4. CIT(A) 2. Respondent 5. DR, ITAT, Bangalore 3. CIT 6. Guard file By order
Assistant Registrar, Income Tax Appellate Tribunal, Bangalore.