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Income Tax Appellate Tribunal, COCHIN BENCH, COCHIN
Before: Shri George George K, JM & Shri Laxmi Prasad Sahu, AM
These are group of 46 appeals at the instance of the assessee. The appeals are directed against separate orders of the CIT(A), all dated 28.05.2021. The relevant assessment years are 2013-2014 to 2015-2016. Common issues are raised in the appeals, hence, there were heard together and are being disposed of by this consolidated order.
The Registry had noted delay in filing these appeals (delay of around 120 days). The orders of the CIT(A) are all dated 28.05.2021 and appeals before ITAT has been filed in the month of January and February 2022. The Hon’ble Apex Court (in Miscellaneous Application No.21 of 2022 dated 10.01.2022), due to the pandemic situation had excluded the period from 15.03.2020 to 28.02.2022 in computing the period of limitation for any suit, appeal, application or proceedings.
3 & Ors. M/s.Kerala Gramin Bank, Kattimoola Branch & Ors. Further, as per judgment of the Hon’ble Apex Court, notwithstanding the actual balance period of limitation, all persons shall have a limitation period of 90 days from 01.03.2022. Further, the Hon’ble Supreme Court held that in the event the actual balance period of limitation remaining, with effect from 01.03.2022 is greater than 90 days, that larger period shall apply. In these cases, the appeals have been filed before ITAT between January 2022 and March 2022 (i.e. well within the period of limitation contemplated by the Hon’ble Apex Court). Therefore, in view of the above judgment of the Hon’ble Apex Court, there is no delay in filing these appeals and we proceed to dispose of the same on merits.
The solitary issue raised in all these appeals is whether the CIT(A) has erred in confirming the Assessing Officer’s order u/s 200A of the I.T.Act, wherein he levied late fees u/s 234E of the I.T.Act for various quarters.
The brief facts of the case are as follows: The assessee is Regional Rural Bank, having its branches in different parts in Kerala, formed with an object of serving rural people, in particular their banking needs. For the assessment years under consideration the assessee’s branches filed TDS returns in Form No.26Q and Form No.24Q for various quarters belatedly. The Assessing Officer levied fees and interest u/s 234E r.w.s. 200A of the I.T.Act for late filing of Form 26Q and 24Q of the said quarters.
4 & Ors. M/s.Kerala Gramin Bank, Kattimoola Branch & Ors.
Aggrieved by the orders of the Assessing Officer, the assessees filed appeals before the first appellate authority. However, the CIT(A) confirmed the A.O.’s orders for levying fees u/s 234E of the I.T.Act. The CIT(A) relied on the judgment of the Hon’ble Kerala High Court in the case of Sree Narayana Guru Smaraka Sangam Upper Primary School v. Union of India and Others reported in (2017) 392 ITR 457 (Ker.) and the judgment of the Hon’ble Gujarat High Court in the case of Shri Rajesh Kourani v. Union of India reported in (2017) 83 taxmann.com 137 (Gujarat). Further, the CIT(A) noted that to file appeal u/s 154 of the I.T.Act, there is no mistake apparent from record.
Aggrieved by the orders of the CIT(A), the assessee has filed these appeals before the Tribunal. The learned AR submitted that the issue raised is squarely covered in favour of the assessee by the following judicial pronouncements:-
(i) The judgment of the Hon’ble Kerala High Court in the case of Olari Little Flower Kuries (P.) Ltd. v. UOI reported in (2022) 440 ITR 26 (Ker.)
(ii) The Hon’ble Kerala High Court judgment in the case of M/s.Sarala Memorial Hospital v. Union of India & The Income Tax Officer (TDS) [WP(C) No.37775 of 2018 of 18th December, 2018]
(iii) The judgment of the Hon’ble Kerala High Court in the case of Sanjeev Mathew & Co. v. ITO (TDS) (judgment dated 30.11.2021)
(iv) The judgment of the Hon’ble Kerala High Court in the case of Headmaster, Government Upper Primary School v. ITO (TDS) (judgment dated 18.05.2022)
(v) The order of the Cochin Bench of the Tribunal in the case of Travels Trails India Pvt. Ltd. V. ACIT TDS, Trivandrum, [ITA No168/Coch/2020 dated 10th June, 2020]
(vi) The order of the Cochin Bench of the Tribunal in the case of Sri.Sabir Ali v. ACIT in & Ors (order dated 20.05.2022)
Apart from the above submission, as regards the contention of the CIT(A) that there is no mistake apparent from record, the learned AR contended that non-consideration of decision of Hon’ble jurisdictional High Court in itself is a mistake apparent from record as held by the Hon’ble Apex Court in the case of ACIT v. Saurashtra Kutch Stock Exchange Ltd. Reported in (2008) 305 ITR 227 (SC).
The learned Departmental Representative relied on the orders of the CIT(A).
We have heard rival submissions and perused the material on record. The assessee-branches have filed belatedly TDS returns for various quarters. The details of branch of the assessee, TAN No. of branch, financial year, the quarters, date of filing of TDS returns, due date of filing of original TDS, late fee levied u/s 234E of the I.T.Act, Intimation dates, date of CIT(A)’s orders etc., are enclosed as Annexure-A to this order.
9.1 The Assessing Officer cannot make any adjustment other than one prescribed in section 200A of the Act. Prior to 01.06.2015, there was no enabling provision in section 200A of 6 & Ors. M/s.Kerala Gramin Bank, Kattimoola Branch & Ors. the Act for making adjustment in respect of statement filed by the assessee with regard to tax deducted at source by levying fees u/s 234E of the Act. The Parliament for the first time enabled the Assessing Officer to make adjustment by levying fees u/s 234E of the Act with effect from 01.06.2015. The Hon’ble jurisdictional High Court in the case of Olari Little Flower Kuries (P.) Ltd. v. Union of India reported in (2022) 440 ITR 26 (Ker.), has held that since provision of section 200A of the I.T.Act was amended to enable computation of fee payable u/s 234E of the I.T.Act at the time of processing of return and said amendment came into effect from 01.06.2015 (in view of CBDT Circular No.19 of 2015 dated 17.11.2015) intimations issued u/s 200A of the I.T.Act dealing with fee for belated filing of TDS returns for the period prior to 01.06.2015 were invalid and were to be set aside. Therefore, going by the dictum laid down by the Hon’ble jurisdictional High Court judgment in the case of Olari Little Flower Kuries (P.) Ltd. v. Union of India (supra), the levy of late fee for the various quarters for financial years 2013-2014 and 2014-2015 cannot be sustained in order passed u/s 200A of the I.T.Act, prior to 01.06.2015.
9.2 The CIT(A) had relied on the judgment of the Hon’ble Kerala High Court in the case of Sree Narayana Guru Smaraka Sangam Upper Primary School v. Union of India and Others (supra). The judgment of the Hon’ble High Court was primarily concerned with the constitutional validity of section 234E of the I.T.Act. The Hon’ble Kerala Court was not adjudicating the issue whether the amendment to section 200A of the I.T.Act
7 & Ors. M/s.Kerala Gramin Bank, Kattimoola Branch & Ors. with effect from 01.06.2015 has retrospective effect or not. As mentioned earlier, the amendment to section 200A of the I.T.Act whether it applicable from 01.06.2015 has been decided in favour of the assessee by the judgment of the Hon’ble Kerala High Court in the case of Olari Little Flower Kuries (P.) Ltd. v. Union of India (supra).
9.3 As regards the CIT(A) placing reliance on the judgment of the Hon’ble Gujarat High Court in the case of Rajesh Kourani v. Union of India (supra), we notice that the Hon’ble Kerala High Court in the case of M/s.Sarala Memorial Hospital v. Union of India (supra) has distinguished the Hon’ble Gujarat High Court judgment. The Hon’ble Kerala High Court had disposed of the Writ Petition in favour of the assessee, stating that there is cleavage in judicial opinion and the judgment in the case of Shri Rajesh Kourani v. Union of India (supra) has not considered CBDT Circular No.19 of 2015, which has clearly emphasized that the amendment would take effect only from 01.06.2016. Therefore, it was concluded by the Hon’ble Kerala High Court that the amendment relating to section 200A of the I.T.Act is prospective with effect from 01.06.2016. In view of the aforesaid reasoning and the judgments of the Hon’ble jurisdictional High Court, cited supra, we allow the claim of the assessee. It is ordered accordingly.
9.4 Before concluding, it is to be mentioned that the CIT(A) held that there is no mistake apparent from record, hence, the appeals filed by the assessee as against orders passed u/s 154 of the I.T.Act cannot be entertained. The judgment of the 8 & Ors. M/s.Kerala Gramin Bank, Kattimoola Branch & Ors. Hon’ble jurisdictional High Court in the case of M/s.Sarala Memorial Hospital v. Union of India & The Income Tax Officer (TDS) (supra) was rendered on 18.12.2018. The intimation u/s 200A of the I.T.Act and the orders of the CIT(A) were passed much subsequent to 18.12.2018. Non-consideration of judgment of the Hon’ble jurisdictional High Court in itself is a mistake apparent from record as held by the Hon’ble Apex Court in the case of ACIT v. Saurashtra Kutch Stock Exchange Ltd. (supra). Therefore, we hold that the CIT(A) was not legally correct in dismissing the appeals stating that there is no mistake apparent from record. It is ordered accordingly.
In the result, the appeals filed by the assessees are allowed.
Order pronounced on this 30th day of June, 2022.