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Income Tax Appellate Tribunal, PUNE BENCHES “B” :: PUNE
Before: MEMBER, & DR.DIPAK P. RIPOTE
आदेश/ ORDER PER BENCH : This bunch of eight appeals filed by the assessee against the separate orders of ld.Commissioner of Income Tax(Appeals)[NFAC], u/sec.250 of the Income Tax Act, 1961 all dated 01.03.2023 emanating from Assessing Officer’s order under section 154 of the Act, all dated 14.04.2022; respectively. The
ITA No(s).1161 to 1168/PUN/2024 (08 Appeals) raised the following grounds of appeal :
1. “1. That on facts and circumstances of the case and in law, the Id. CIT(A), NFAC, Delhi was not justified in confirming the levy of aggregate late fee u/s 234E of Rs. 2,50,000/- and interest thereon u/s 220(2) of Rs. 2,53,314/- without appreciating the law and facts of the case . The CIT(A) erred in law by dismissing the appeal and upholding the imposition of late fees under Section 234E.
2. That the provision for levy of late fee u/s 200A(1 )(c) read with section 234E was introduced vide Finance Act 2015 w.e.f. 01-06-2015 enabling the AO to determine the late fee. The said provision is prospective in nature and the AO was not empowered to charge late fee and interest thereon in the present case. It is certain that the charging section of levy of late fee u/s 234E is a statutory provision effective from the year 2012 but there was no machinery provision u/s 200A of the Act which empowered the AO to make adjustment on account of levy of late fee u/s 234E of the Act.
3. The Ld. CIT(A) failed to consider that in respect of TDS statements filed for the period prior to 01-06-2015, the late fee u/s 234E could not have been levied and hence, the levy of late fee in respect of the TDS statement filed (under Form 26Q & 24Q both) in the instant case for Ql, Q2, Q3 & Q4 was not justified in the intimation passed u/s 200A of the Act.
4. That in absence of provision in the statute, the impugned order is invalid and bad in law. Reliance is placed on following case laws which dealt with similar issue- i. Fatehraj Singhvi & Ors. vs. UOI & Ors. 2016 (9) TMI964 (Karnataka High Court) ii. Sonalac Paints & Coatings Ltd. v. DCIT (2018) 167 DTR 83 / 194 TTJ 771 (Chd)(Trib.) iii. M/s. Terra Infra Development Limited Hyderabad & 1875/Hyd/2017 iv. Vidya Vardhani Education and Research Foundation in to 1893/PUN/2016.
5. Without prejudice to above ground, it is submitted that the TDS having been deposited along with interest and there being no case of deliberate non-compliance to the provisions of the Act, the levy of late fee and interest there on would result in genuine hardship to the assessee and hence, the same ought to have been deleted on the facts of the case.
ITA No(s).1161 to 1168/PUN/2024 (08 Appeals)
Upholding the imposition of late fees in the present case would lead to an injustice, considering the differential treatment accorded to similar cases by the appellate authorities. We pray that this Tribunal may take a lenient and compassionate approach and condone the delay of436 days in filing the present appeal against the orders of the Ld. CIT(A) passed under section 250 of the Act and hear the same on merits for the advancement of substantial cause of justice. Therefore, we request you to consider the above grounds and accept the appeal.”
2. In this case, Assessee had filed TDS Return after due date. The DCIT-CPC-TDS has levied late fee u/sec.234E of the Act for F.Y.2013-14(Q4) as the TDS Return was filed after the due date. The assessee preferred an appeal before the ld.CIT(A). Ld.CIT(A) upheld the order of the DCIT-CPC-TDS.
2.1 Aggrieved by the same, assessee filed appeal before this Tribunal.
The issue involved in this case is whether late fee under section 234E can be levied for F.Y. 2013-14(Q4). This issue is covered in favour of the assessee. The ITAT Pune in the case of Medical Superintendent Rural Hospital, vs. DCIT, CPC(TDS) [2018] 100 taxmann.com 78 (Pune Tribunal) has observed as under: “11. We have heard the rival contentions and perused the record. The issue arising in the present bunch of appeals is against levy of late filing fees under section 234E of the Act while issuing intimation
ITA No(s).1161 to 1168/PUN/2024 (08 Appeals) under section 200A of the Act, in the first bunch of appeals. The second bunch of appeals in the case of Junagade Healthcare Pvt. Ltd. is against order of Assessing Officer passed under section 154 of the Act rejecting rectification application moved by assessee against intimation issued levying late filing fees charged under section 234E of the Act. The case of assessee before us is that the issue is squarely covered by various orders of Tribunal, wherein the issue has been decided in respect of levy of late filing fees under section 234E of the Act, in the absence of empowerment by the Act upon Assessing Officer to levy such fees while issuing intimation under section 200A of the Act. The Tribunal vide order dated 21.09.2016 with lead order in Maharashtra Cricket Association v. Dy. CIT [2016] 74 taxmann.com 6 (Pune - Trib.) relating to assessment years 2013-14 and 2014-15 for the respective quarters deliberated upon the issue and held as under:— "34. Accordingly, we hold that the amendment to section 200A(1) of the Act is procedural in nature and in view thereof, the Assessing Officer while processing the TDS statements / returns in the present set of appeals for the period prior to 01.06.2015, was not empowered to charge fees under section 234E of the Act. Hence, the intimation issued by the Assessing Officer under section 200A of the Act in all these appeals does not stand and the demand raised by way of charging the fees under section 234E of the Act is not valid and the same is deleted. The intimation issued by the Assessing Officer was beyond the scope of adjustment provided under section 200A of the Act and such adjustment could not stand in the eye of law."
The said proposition has been applied in the next bunch of appeals with lead order in Vidya Vardhani Education & Research Foundation v. Dy. CIT [2017] 88 taxmann.com 894 (Pune - Trib.) and also in Swami Vivekanand Vidyalaya (supra) and Medical Superintendant Rural Hospital v. ACIT [IT Appeal Nos.2072 & 2073 (PUN) of 2017, order dated 21-12-2017], which has been relied upon by the learned Authorized Representative for the assessee.
The Hon'ble High Court of Karnataka in the case of Fatheraj Singhvi (supra) had also laid down similar proposition that the amendment to section 200A of the Act w.e.f. 01.06.2015 has prospective effect and is not applicable for the period of respective assessment years prior to 01.06.2015. The relevant findings of the Hon'ble High Court are in paras 21 and 22, which read as under:— "21. However, if Section 234E providing for fee was brought on the state book, keeping in view the aforesaid purpose and the ITA No(s).1161 to 1168/PUN/2024 (08 Appeals) intention then, the other mechanism provided for computation of fee and failure for payment of fee under Section 200A which has been brought about with effect from 1.6.2015 cannot be said as only by way of a regulatory mode or a regulatory mechanism but it can rather be termed as conferring substantive power upon the authority. It is true that, a regulatory mechanism by insertion of any provision made in the statute book, may have a retroactive character but, whether such provision provides for a mere regulatory mechanism or confers substantive power upon the authority would also be a aspect which may be required to be considered before such provisions is held to be retroactive in nature. Further, when any provision is inserted for liability to pay any tax or the fee by way of compensatory in nature or fee independently simultaneously mode and the manner of its enforceability is also required to be considered and examined. Not only that, but, if the mode and the manner is not expressly prescribed, the provisions may also be vulnerable. All such aspects will be required to be considered before one considers regulatory mechanism or provision for regulating the mode and the manner of recovery and its enforceability as retroactive. If at the time when the fee was provided under Section 234E, the Parliament also provided for its utility for giving privilege under Section 271H(3) that too by expressly put bar for penalty under Section 272A by insertion of proviso to Section 272A(2), it can be said that a particular set up for imposition and the payment of fee under Section 234E was provided but, it did not provide for making of demand of such fee under Section 200A payable under Section 234E. Hence, considering the aforesaid peculiar facts and circumstances, we are unable to accept the contention of the learned counsel for respondent-Revenue that insertion of clause (c) to (f) under Section 200A(1) should be treated as retroactive in character and not prospective.
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 of fee 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
ITA No(s).1161 to 1168/PUN/2024 (08 Appeals) 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."
The Hon'ble High Court thus held that where the impugned notices given by Revenue Department under section 200A of the Act were for the period prior to 01.06.2015, then same were illegal and invalid. Vide para 27, it was further held that the impugned notices under section 200A of the Act were for computation and intimation for payment of fees under section 234E of the Act as they relate for the period of tax deducted at source prior to 01.06.2015 were being set aside. 3.1 Thus, late fee u/sec.234E for the period prior to 01.06.2015 levied by Assessing Officer is bad in law.
Respectfully following the above decision of ITAT Pune Bench, we hold that the levy of late fee under section 234E of the Act for the period prior to 01.06.2015 is bad in law. Therefore, the Assessing Officer is directed to delete the said late fee. Accordingly, the appeal of the assessee is allowed.
In the result, appeal in of the assessee is allowed.
ITA No(s).1162 to 1168/PUN/2024 6. The facts of are similar to the facts of to 1168/PUN/2024, therefore, our decision in ITA No(s).1161 to 1168/PUN/2024 (08 Appeals) shall apply mutatis mutandis to these appeals also, as late fee levied u/s.234E in these appeals is for the period prior to 01/06/2015.
In the result, appeals in to 1168/PUN/2024 of the assessee are allowed.
To sum up, all eight appeals filed by the assessee are allowed. Order pronounced in the open Court on 20th September, 2024.