M/S LOTUS MACHINES PVT. LTD.,CHANDIGARH vs. DCIT, CPC (TDS-1), VAISHALI CURRENT JURISDCITION ITO (TDS-1), CHANDIGARH

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ITA 1137/CHANDI/2017Status: DisposedITAT Chandigarh14 May 2018AY 2013-143 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the levy of fee under Section 234E while processing a TDS return under Section 200A was not permissible prior to the amendment of Section 200A effective from June 1, 2015. Therefore, the adjustment made was without authority of law.

What were the facts?

The assessee's appeal concerns the levy of a fee under Section 234E while processing a TDS return under Section 200A. The fee was levied prior to June 1, 2015.

What were the issues?

Whether a fee under Section 234E could be levied by way of adjustment while processing a TDS return under Section 200A prior to June 1, 2015.

Which sections of the Income-tax Act were involved?

Section 200A,Section 234E

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DIVISION BENCH, CHANDIGARH

Before: SHRI SANJAY GARG & DR. B.R.R. KUMAR

For Respondent: Ms. Deepika Mohan, JCIT
Hearing: 14.05.2018Pronounced: 14.05.2018

Per Sanjay Garg, Judicial Member:

The present appeal has been preferred by the assessee against

the order dated 03.04.2017 of the Commissioner of Income Tax(Appeals)-1, Chandigarh [hereinafter referred to as ‘CIT(A)’].

2.

Though as many as six grounds have been raised in the appeal

but the sole issue taken by the assessee through its grounds of

appeal relates to action of Ld. CIT(A) in confirming the levy of fee

u/s 234 E through notice u/s 200A imposed by the Ld. Assessing

officer.

3.

During the course of hearing before us, ld. counsel for the

ITA No.1137/Chd/2017- M/s Lotus Machines Pvt Ltd., Chandigarh 2

assessee stated that the fees in the present case was levied while

processing the TDS return u/s 200A of the Act, prior to 01.06.2015,

and that as per the provisions of Section 200A of the Act, which

existed on the date when the above return was processed, no

adjustment on account of fees u/s 234E could be made while

processing the said return u/s 200A of the Act. The ld. counsel for

the assessee pointed out that the mandate to make such adjustment

was provided by the Statute only w.e.f. 01.06.2015 by way of an

amendment made to Section 200A by the Finance Act, 2015. The ld.

counsel for the assessee, therefore, stated that the adjustment made

in the present case of levying fees u/s 234E while processing the

TDS return u/s 200A of the Act was bad in law. The ld. counsel for

the assessee pointed out that the ITAT in a number of cases had

deleted fees levied in identical circumstances holding that prior to

01.06.2015, fees u/s 234E could not be charged by way of making

adjustment while processing TDS return u/s 200A of the Act. Our

attention was drawn to the following case laws in support of the

above proposition:

1.

M/s Khanna Watches Ltd. V DCIT CPC(TDS) ITA 731 to 735/CHD/2015 dated 29.10.2015

2.

Sibia Healthcare Pvt. Ltd. Vs DCIT (2015) 121 ITR 81 (Amritsar)

3.

M/s Sonaiac Paints & Coatings Ltd. Vs. DCIT – ITA No. 1158/Chd/2017 order dated 1.2.2018

4.

The Ld. DR fairly admitted that the issue is squarely covered

by the aforesaid decisions of the Tribunal.

ITA No.1137/Chd/2017- M/s Lotus Machines Pvt Ltd., Chandigarh 3

5.

In view of above, the addition made by the Assessing officer on account of fee u/s 234E of the Act while processing the return u/s 200A is being without authority of law and the same is directed to be deleted. In the result, the appeal of the assessee is hereby allowed. Order pronounced in the Open Court.

Sd/- Sd/-

(B.R.R.KUMAR) (SANJAY GARG) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated : 14.05.2018 Rkk

Copy to: • The Appellant • The Respondent • The CIT • The CIT(A) • The DR

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