G MANIKANDAN,KARAIKAL vs. ITO TDS WARD, PUDUCHERRY

आदेश / O R D E R

PER GEORGE MATHAN, JUDICIAL MEMBER

Mr.A.S.Sriraman represented on behalf of the Assessee and 2.

Mr.B.Sagadevan represented on behalf of the Revenue.

5. In reply, the ld.D.R vehemently supported the order of the ld.CIT(Appeals).

“5. We have considered the rival submissions. A perusal of the grounds of appeal shows that the assessee has relied on the decision of Co-ordinate Bench of this Tribunal in the case of Smt.G.Indhirani in 1020 & 1021/Mds./2015 dated 10.07.2015 for assessment year 2013-14 wherein the Tribunal has held as follows:- “11. In view of the above discussion, this Tribunal is of the considered opinion that the A.O has exceeded his jurisdiction in levying fee under Section 234E while processing the statement and make adjustment under Section 200A of the Act. Therefore, the impugned intimation of the lower authorities levying fee under Section 234E of the Act cannot be sustained in law. However, it is made clear that it is open to the Assessing Officer to pass a separate order under Section 234E of the Act levying fee provided the limitation for such a levy has not expired. Accordingly, the intimation under Section 200A as confirmed by the CIT(Appeals) in sofar as levy of fee under Section 234E is set aside and fee levied is deleted. However, the other adjustment made by the Assessing Officer in the impugned intimation shall stand as such.” Here, we have to mention that the decision of the Hon’ble Gujarat High Court in the case of Rajesh Kourani has not been considered as it was not available at that point of time. The Co-ordinate Bench of Agra Bench in the case of State Bank of India in ITA No.03,06, And 07/Ag./2018 for assessment year 2013-14 dated 31.05.2018 by considering the decision of the Hon’ble Gujarat High Court in the case of Rajesh Kourani has held in paras 8 to 11 as follows:- “

8. Heard the rival contention and perused the material relevant. We find that while deciding the issue against the appellant assessee the Id. CIT(A) has placed reliance on ‘Rajesh Kaurani vs. Union of India’, 83 Taxmanncom 137 (Guj.) wherein it was held that Section 200A of the Act is a machinery provision providing the mechanism for processing a TDS statement of deduction of tax at source and for making adjustment. The Ld. CIT(A) has further held that this decision was delivered after considering numerous ITAT and High Court decisions and therefore this decision in ‘Rajesh Kaurani’ (Supra), holds the fields.

9. It is seen that prior 01.06.2015, there was no enabling provision in the Act u/s 200A for raising demand in respect of levy of fee u/s 234E of the Act. The provision of Section 234E of the Act is charging provision i.e. substantive provision which could not be applied retrospectively, unless it is expressly provided in the Act, to levy the late fee for any delay in filing the TDS statement for the period prior to 01.06.2015. The counsel for the assessee has rightly contended that in the absence of enabling provisions u/s 200A of the Act, such levy of late fee is not valid relying on the decisions in the cases of ‘CIT vs. Vatika Township Pvt. Ltd. (2014) 367 ITR 466 (SC), ‘Sudarshan Goyal vs DCIT (TDS)’ and Fatehraj Singhvi Vs. UOI (2016) 289 CTR 0602 (Karn) (HC). The decisions relied on by the Ld. DR are distinguishable on facts, as the issue involved in those cases pertains to interest u/s 201(1) and 201(1A) on the amount of TDS whereas in the present cases the issue were pertains to liability of late fee u/s 234E of the Act for delay in filing TDS statement which was inserted from 01.06.2015.

“3. Heard. The id. CIT(A), while deciding the matter against the assessee, has placed reliance on ‘Rajesh Kaurani vs. UOI’, 83 Taxmann.com 137 (Guj), wherein, it has been held that section 200A of the Act is a machineiy provision providing the mechanism for processing a statement of deduction of tax at source and for making adjustments. The id. CIT(A) has held that this decision was delivered after considering numerous ITAT/High Court decisions and so, this decision in ‘Rajesh Kaurani’ (supra) holds the field.

4. We do not find the view taken by the Id. CIT(A) to be correct in law. As against ‘Rajesh Kaurani’ (supra), ‘Shri Fatehraj Singhvi and Others vs. UOI’, 73 Taxmann.com 252 (Ker), as also admitted by the ld. CIT(A) himself decides the issue in favour of the assessee. The only objection of the Id. CIT(’A) is that this decision and others to the same effect have been taken into consideration by the Hon ‘ble Gujaral High Court while passing ‘Rajesh Kaurani’ (supra). However, while observing so, the Id. IT(’A) has failed to take into consideration the settled law that where there is a cleavage of opinion between different High Courts on an issue, the one in favour of the assessee needs to be followed. It has so been held by the Hon ‘ble Supreme Court in ‘CIT vs. Vegetable Products Ltd.’, 88 ITR 192 (SC). It is also not a case where the decision against the assessee has been rendered by the Jurisdictional High Court qua the assessee.

“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 200A for computation and intimation for the payment offee under Section 234E 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 1 .6.2015. However, we make it clear that, if any deductor has already paid the fee after intimation received under Section 200A, the aforesaid view will not permit the deductor to reopen the said question unless he has made payment under protest.”

6. In view of the above, respectfully following ‘Shri Fatehraj Singhvi and Others’ (supra), ‘Sibia Healthcare Pvt. Ltd. vs. DCIT (TDS)’, order dated 09.06.2015 passed in JTA No.90/ASR/20]5, for A.Y.20]3-14, by the Amritsar Bench of the Tribunal, and ‘Shri Kaur Chand Jam vs. DGJT, C’PC (TDS.) Ghaziabad’, order dated 15.09.2016, in for A.Y. 2012-13, the grievance of the assessee is accepted as justified. The order under appeal is reversed. The levy of the fee is cancelled.”

Following the decision of the Co-ordinate Bench of Agra Bench in the case of State Bank of India, the Co-ordinate Bench of Chennai Tribunal in the case of Shri Anil Bohra in to 2110/Chny/2018 vide order dated 28.11.2018 has held that “since, the D.R has not brought to our notice any decision rendered by the Jurisdictional High Court, qua the issues, respectfully following the above decisions of the Agra Bench, the assessee’s appeals are allowed.” In the circumstances, respectfully following the decision of Co-ordinate Bench of this Tribunal in the case of Shri Anil Bohra referred to supra on identical findings, the late fee levied u/s.234E of the Act stands cancelled.”

As it is noticed that the issue is squarely covered by the decision of Co-ordinate Bench of this Tribunal in the case of M/s.Karuna Electricals in to 2333/Chny/2018 referred to supra, the levy of late fee u/s.234E of the Act in respect of assessee for assessment year 2015-16 stands deleted.

Order pronounced in the open court on 01 January, 2019, at Chennai.