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Income Tax Appellate Tribunal, NAGPUR BENCH, NAGPUR
Before: SHRI SANDEEP GOSAIN & SHRI ARUN KHODPIA
PER ARUN KHODPIA, A.M.
This bunch of appeals have been filed by two different assessee which are represented by different Authorised Representatives details of which are as per cause title cited supra, challenging the separate orders passed by the first appellate authority, the details of which are tabulated below:–
Section under Date of order which the passed by Sr. order Appeal Number and Assessment Year the first no. appealed appellate against authority was passed 1. ITA no.115/Nag./2021 A.Y. 2013–14 30.09.2021 200A 2. ITA no.116/Nag./2021 A.Y. 2014–15 30.09.2021 200A 3. ITA no.117/Nag./2021 A.Y. 2013–14 30.09.2021 200A 4. ITA no.118/Nag./2021 A.Y. 2013–14 30.09.2021 200A 5. ITA no.119/Nag./2021 A.Y. 2013–14 30.09.2021 200A 6. ITA no.129/Nag./2021 A.Y. 2013–14 12.10.2021 200A 7. ITA no.130/Nag./2021 A.Y. 2013–14 12.10.2021 200A
Since all the aforesaid appeals involve common issue, except variation in figures, which arose out of identical set of facts and circumstances, therefore, as a matter of convenience, these appeals were clubbed and heard together and are being disposed off by way of this consolidated order. However, in order to understand the
Ms. Shephali Anil Malviya Shri Vinod Pandharinath Duragkar
implication, it would be necessary to take note of the facts of one appeal. We are, therefore, narrating the facts, as they appear in the appeal in ITAno.115 to 119/Nag./2021 (Ms. Shephali Anil Malviya), the result of which will be mutatis mutandis applicable to the other similarly situated appeals on identical issue raised by the assessee for the other assessment years under consideration.
In all the aforesaid appeals, the only common issue arose out of the grounds of appeal raised by the captioned assessees for the years under consideration is, whether or not the Assessing Officer was justified in imposing late filing fee payable u/s 234E of the Act.
ITA No.115 to 119/Nag./2021 Ms. Shephali Anil Malviya
Brief facts for the second quarter for the financial year relevant to the assessment year 2013–14 are, the assessee in the present case is an individual having TAN bearing no.NGPS06908G. The assessee is said to have been complying with the provisions of TDS as prescribed in the Act. The assessee is duly deducted TDS for Q2 for the financial year 2012–13, paid the same to the credit of Central Government and filed the return of income / statement of TDS in Form no.26Q as prescribed under section 200(3) of the Act on 13th August 2013. The Assessing Officer noticed that the assessee has
Ms. Shephali Anil Malviya Shri Vinod Pandharinath Duragkar
filed the statement belatedly and, therefore, issued intimation under section 200A of the Act with reference to the statement / return of TDS so filed in Form no.26Q for Q2 of the financial 2012–13 levying a late filing fee of `.57,800, under section 234E of the Act. The assessee being aggrieved with the order of the Assessing Officer, filed appeal before the first appellate authority.
The learned CIT(A) confirmed the order of the Assessing Officer by observing as follows:–
“I have considered the appellant's contention and find that the provision of Section 234E of the Act for levy of fee was brought in the statute w.e.f. 01/07/2012. Thus, the charging section for levy of Fee being Section 234E was already brought in the Act w.e.f. 01/07/2012. The provision of clause(c) to section 200A brought in the Act w.e.f. i 01/06/2015 is machinery provision for adjustment u/s 200A of the Act for the Fee calculated as per Section 234E of the Act. The case laws referred by the appellant i are all based on the decision that the provision for levy of Fees u/s 234E of the Act -was brought with effect from 01/06/2015. On this issue, there is another decision of Hon'ble Gujarat High Court in the case of Rajesh Kourani vs. UOI, 83 taxmann.com 137 wherein the Hon'ble Court held that the machinery provision of clause(c) to Section 200A cannot override the charging Section 234E of the Act. It was also observed that at the most, the amendment to Section 200A bringing in clause(c) w.e.f. 01/06/2015 can be considered as clarificatory in nature. It was also held by the Hon'ble High Court that even without clause(c) to Section 200A, the revenue had authority to levy fee by virtue of Section 234E of the Act with effect from 01.07.2012. In view of the facts of current case and the decision of Hon'ble Gujarat High Court in the case of Rajesh Kourani (supra), it is apparent that the levy of Fee u/s 234E of the Act is as per provision of the Act. The provision of Section 234E(3) requires that the amount of Fee referred to in Sub– section (1) of Section 234E shall be paid before delivering or clausing to be delivered a statement in accordance with section
Ms. Shephali Anil Malviya Shri Vinod Pandharinath Duragkar
(3) to Section 200 or Sub–section (3) to Section 206C of the Act. This clearly authorized the AO to compute Fee leviable as per Section 234E while processing the return u/s 200A of the Act. Hence, the ground taken by the appellant is hereby dismissed.”
The assessee being once again aggrieved by the order so passed by the first appellate authority, is in appeal before the Tribunal.
Before us, the learned Counsel, Shri Kapil Hirani, Advocate, appeared on behalf of the assessee and submitted that issue of levying a late filing fee of ` 57,800, under section 234E of the Act is squarely covered by the decision of this Bench rendered in DIG Medical Composite Hospital CRPF v/s ACIT, ITA no.176/Nag./2019, etc., for the assessment year 2014–15, vide order dated 21st February 2020. The learned Counsel accordingly prayed that levying of late filing fee be deleted.
The learned Departmental Representative relied on the order of the authorities below.
We have carefully considered the rival contentions, perused the orders of the authorities below and the material placed on record. We find force in the submissions of the learned Counsel for the assessee. He filed a copy of the order dated 21st February 2020, passed by the
Ms. Shephali Anil Malviya Shri Vinod Pandharinath Duragkar
Co–ordinate Bench of the Tribunal, Nagpur Bench, in DIG Medical Composite Hospital CRPF (supra) wherein for the detailed reasons stated therein the Tribunal has directed to delete the late filing fee charged by the Assessing Officer. The relevant observation of the Tribunal in the said case are reproduced below:–
“6. We have perused the case record and heard the rival contentions on the issue of unavailability of enabling the provisions to the Assessing Officer for levy of late filing fees on the assessee in respect of defaults of non-filing of TDS statement for the period prior to 01.06.2015. We find that this issue has already been adjudicated by the Co-ordinate Bench of the Tribunal, Nagpur (through e-Court, Pune) in the case of M/s. Rajyas Software Pvt. Ltd. Vs. ACIT, CPC-TDS, Ghaziabad & Others, in ITA No. 208/NAG/2019 & Others and decided the issue in favour of the assessees by observing as follows: "6. We have heard both the sides on this issue of unavailability of enabling the provisions to the Assessing Officer for levy of late filing fees on the assessee in respect of defaults of non-filing of TDS statement for the period prior to 01.06.2015. It is undisputed fact that the provisions of section 234E of the Act was originally brought into Statute w.e.f. 01.7.2012 by the Finance Act, 2012. However, the un- amended provisions of section 200A of the Act were not to provide the powers to the officers to charge the late filing fees. In principle, the provisions of section 234E of the Act enables the officers for the procedure to levy late filing fees when the assessee failed to file the TDS statements under subsection (3) of section 200 of the Act. There is no dispute about the fact on availability of enabling the provisions w.e.f. 01.06.2015 only. The Finance Act, 2015 provides for the amendment to section 200A of the Act enabling the Assessing Officers to levy late filing fee for default of late filing of TDS statements. There are huge amount of litigation on the issue i.e. if the Assessing Officer has pouter to levy the late filing fees when the assessee files the TDS statement for the quarters filing upto 01.06.2015. However, there is no dispute about the non-availability of such powers for the quarter related to the period later to 01.06.2015. 7. During the time of argument before us, on the issue of notice u/s 234E of the Act, which is different from the levy of
Ms. Shephali Anil Malviya Shri Vinod Pandharinath Duragkar
fee at the time of processing of TDS statements, Mr. Atal, Id. Counsel, mentioned that the officers of the Department have started issuing notices independently under the provisions of section 234E of the Act and, for that, the Department relies on the decision ofChennai Bench of the Tribunal in the case ofSmt. G. Indhirani vs. DCIT vide ITA Nos.l019to 1021/Mds/2015 and others dated 10.07.2015. Referring to the contents of para 8 to 11 of the said decision in the case of Smt. G. Indhirani (supra) where the Tribunal obliquely referred to the availability of powers independently for collecting the said late filing fees in case of belated TDS statements, Id. Counsel mentioned that the said decision of the Tribunal (supra) was pronounced prior to the Hon'ble Karnataka High Court's judgement in the case of Fatheraj Singhvi (supra) and after the judgement of the Hon'ble High Court, the decision of the Tribunal in the case of Smt. G. Indhirani (supra) is not a good law. It is the decision of the Hon'ble Karnataka High Court's judgment (supra) that the provisions of the amendment to section 200A r.w.s. 234E are prospective. 8. Further, Id. Counsel submitted that in the instance case, the late filing fees was levied u/s 234E of the Act at the time of processing of the TDS statements. The Assessing Officer never issued independent notices u/s 234E of the Act. 9. Ld. AR submitted that, at the time of processing of TDS statements, Assessing Officer is prevented from levy of fee for the default of late furnishing of TDS statement. He relied on various decisions in his support. Coming to the legal precedent on this issue. Relying on the decisions of Pune Bench of the Tribunal in the case Medical Superintendent Rural Hospital vs. DOT vide ITA No.651/PUN/2018 and others dated 25.10.2018, in the case of C & M Farming Ltd. vs. ACIT vide TTA Nos.2008 to 2017/PUN/2017 dated 06.11.2019, Id. AR submitted that the Assessing Officer suffers from lack of jurisdictional power in respect of charging of late filing fee for the assessee's defaults for the period upto 01.06.2015, the date of amendment (supra). We have also held that the TDS statements furnished for the said period subsequent to 01.06.2015, the Assessing Officer compute late filing fee on the said belated TDS statements. This is a law so far as specific issue is concerned as on date. The relevant extract from the said judgements and other decisions are as follows. A. C & M Farming Ltd. (supra) : "7. The contention of Shri Kishore Phadke, the Ld.A.R. is that AO has no jurisdiction to charge late fee u/s 234E of the Act for the reason that there was no enabling procedure for computation of late fee u/s 200A 7
Ms. Shephali Anil Malviya Shri Vinod Pandharinath Duragkar
of the Act concerning the year under consideration. Further, he submitted that the computation of late fee was inserted in the Finance Act w.e.f. 01.06.2015 and since the amendment is prospective in nature, the late fee imposed u/s 234E r.w. 200A of the Act is not maintainable in the present case. The Ld.A.R. placed reliance on the decision of the Tribunal in the case of Medical Superintendent Rural Hospital, DOBIBK Vs. DCIT, CPC(TDS) reported in (2018) 100 taxmann.com 78 (Pune - Trib) and referred to Para Nos. 15 & 16 and submitted that the demand of late fee is not maintainable even if the returns of the TDS were filed after 01.06.2015, the order charging late filing fee was passed after 01.06.2015. He argued that the factual circumstances are similar to the present case, the assessee filed TDS statements belatedly after 01.06.2015 and the ACIT, (CPS-TDS) charged late fee u/s 234E of the Act after 01.06.2015. The Ld. D.R. did not controvert the same. 8. Heard both sides and perused the material available on record. We find the issue raised in the present appeal is similar to the issue raised by the Co-ordinate Bench of the Tribunal in the case of Medical Superintendent Rural Hospital, DOBI BK(supra), wherein the co-ordinate Bench of the Tribunal held that charging of late fee u/s 234E of the Act is not maintainable even if the assessee files TDS returns belatedly and the Assessing Officer issues intimation u/s 2OOA of the Act after Ol.06.2015 charging late filing fee u/s 234E of the Act. Therefore, we find force in the arguments of Shri Kishore Phadke, Ld.A.R. and the imposition of late fee u/s 200A r.w 234E of the Act confirmed by Ld.CIT(A) is set aside. Thus, additional ground raised by the assessee is allowed." B. Medical Superintendent Rural Hospital (supra) : "15. In other words, the Hon'ble High Court of Kamataka explained the position of charging of late filing fees under section 234E of the Act and the mechanism provided for computation of fees and failure for payment of fees under section 200A of the Act which was brought on Statute w.e.f. 01.06.2015. The said amendment was held to be prospective in nature and hence, notices issued under section 200A of the Act for computation and intimation for payment of late filing fees under section 234E of the Act relating to the period of tax deduction prior to 01.06.2015 were not maintainable and were set aside by the Hon'ble High Court. In view of said proposition being laid down by the Hon'ble High Court of Kamataka (supra), there is no merit in observations of CITfA) that in the present case, where the returns of TDS were filed for each of the quarters after 1 st day of June, 2015 and even the order charging late filing fees was passed after June, 2015, then the same are maintainable, since the 8
Ms. Shephali Anil Malviya Shri Vinod Pandharinath Duragkar
amendment had come into effect. The CIT(A) has overlooked the fact that notices under section 200A of the Act were issued for computing and charging late filing fees under section 234E of the Act for the period of tax deducted prior to 1st day of June, 2015. The same cannot be charged by issue of notices after 1st day of June, 2015 even where the returns were filed belatedly by the deductor after 1st June, 2015, where it clearly related to the period prior to 01.06.2015. 16. We hold that the issue raised in the present bunch of appeals is identical to the issue raised before the Tribunal in different bunches of appeals and since the amendment to section 200A of the Act was prospective in nature, the Assessing Officer while processing TDS returns / statements for the period prior to 01.06.2015 was not empowered to charge late filing fees under section 234E of the Act, even in cases where such TDS returns were filed belatedly after June, 2015 and even in cases where the Assessing Officer processed the said TDS returns after June, 2015. Accordingly, we hold that intimation issued by Assessing Officer under section 20OA of the Act in all the appeals does not stand and the demand raised by charging late filing fees under section 234E of the Act is not valid and the same is deleted." C. Fatheraj Singhvi vs. Union of India, 73 taxmann.com 252 (Karnataka-HC) dated 26.08.2016 : "24. If the facts of the present cases are examined in light of the aforesaid observation and discussion, it appears that in all matters, the intimation given in purported exercise of power under Section 200A are in respect of fees under Section 234E for the period prior to 1.6.2015. As such, it is on account of the intimation given making demand of the fees in purported exercise of power under Section 200A, the same has necessitated the appellant-original petitioner to challenge the validity of Section 234E of the Act. In view of the reasons recorded by us hereinabove, when the amendment made under Section 200A of the Act which has come into effect on 1.6.2O15 is held to be having prospective effect, no computation of fee for the demand or the intimation for the fee under Section 234E could be made for the TDS deducted for the respective assessment year prior to 1.6.2O15. Hence, the demand notices under Section 200A by the respondentauthority for intimation for payment of fee under Section 234E can be said as without any authority of law and the same are quashed and set aside to that extent." D. Alpha Electronics Pvt. Ltd. vs. ACIT vide ITA N0.1450/PUN/2019 and others dated 13.12.2019
Ms. Shephali Anil Malviya Shri Vinod Pandharinath Duragkar
"7. We have perused the case records and heard the rival contentions. We have also given considerable thought to the facts and circumstances involved in all these cases. It is observed on perusal of Section 200 sub section (3) r.w.s. 206C sub-section (3) proviso that when the assessee has deducted TDS, he has to deposit the amount in the Government account and after doing that he has to furnish the TDS statement before the Income Tax Authorities within the prescribed time limit. If there is late filing of those TDS statements then the Revenue Authorities may charge late filing fees u/s.234E of the Act. That however, this power the Legislature was provided to the Authorities by inserting Clause (c) to Section 200A(1) of the Act w.e.f. 01.06.2015. There are plethora of cases which decided this issue that if TDS statements were filed prior to 01.06.2015 then there cannot be any levy of late fees U/S.234E of the Act. That however, TDS statements filed after 01.06.2015 would attract the late filing fees as per Section 234E of the Act. We further observe that in these instant cases before us, in some of the cases, TDS statements were filed prior to 01.06.2015 while in some other cases, they were filed after 01.06.2015. This is the position on merits. That however, the Ld. CIT(Appeal)'s in their respective orders has not dealt with the merits of these cases and has dismissed the appeals of the assessee on the ground that there is substantial delay in filing of these appeals and also for the reason that the reasonableness attributed to that delay could not be established by the assessees therein. 8. We find that the Hon" ble Apex Court in the case of Anil Kumar Nehru Vs. ACIT (2018) 103 CCH 0231 ISCC has held that even if there is substantial delay in filing of appeals it can be condoned on the ground that it involves a question of law which goes into the root of the matter. In these set of appeals before us, it pertains to a legal question whether late fees would be leviable on the assessee or not depending upon the merits involved in each case." 10. From the above extracts of the judgment of the Hon'ble High Court as well as the Tribunal's order, where, we the undersigned are the party to a decision, we are of the opinion that it is settled issue that amendment brought in by the Finance Act, 2015 w.e.f. 01.06.2015 to section 200A r.w.s. 234E of the Act is prospective and consequently, for all the defaults committed by the assessee for the quarters prior to 01,06.2015, in respect of the TDS statements are filed belatedly either before 01.06.2015 or 01.06.2015, the Assessing Officer has no jurisdiction to charge late filing fee at the time of processing of the TDS statements.
Ms. Shephali Anil Malviya Shri Vinod Pandharinath Duragkar
We have also noticed that Mr. Atal, Id. Counsel, common to all the 111 appeals, filed the statement giving specific details of quarters involved, due dates for the quarters and actual date of furnishing of statements. On perusal of the said statements, the date of quarters involved and the actual date of filing of the statements, we find that the financial years involved are F.Y. 2012-13, 2013-14 and 2014-15. Further, we also noticed that the actual date of filing of TDS statements belatedly predominantly happened before 01.06.2015 only. However, we find in some cases i. e. ft) Vishwas Power Engineering Services Pvt. Ltd.; (ii) Audarya Construction Pvt. Ltd.; (Hi) Nagar Parishad Pauni; (iv) Uttam Sngh Rauthan; (v) Champak Mines and Minerals; and, (vi) Maharashtra Panchayat Samiti Bhandara, the TDS statements were furnished belatedly i.e. after 01.06.2015. In any case, the defaults in all these quarters of 111 cases by the assessees occurred in the period before 01.06.2015. Therefore, in view of the precedents, the late filing fees charged by the Assessing Officer is unsustainable in law for want of jurisdiction. 12. Before parting the order, we direct the Assessing Officer to examine closely the facts, dates of defaults, claims of the assesses etc once again and ensure that the above law is correctly applied to the facts of the present set of 111 cases. In case, the default pertains to the period later to 01.06.2015, the provisions for late filing fees u/s 234E r.w.s. 200A of the Act attract. With these directions, all these 111 appeals are allowed protanto. 13. In the result, all the 111 appeals preferred by the different assessees are allowed. Respectfully, following the decision of the Co-ordinate Bench of the Tribunal, Nagpur (through e-Court, Pune) in the cases mentioned hereinabove, we allow the appeals of the assessee.”
On a perusal of the aforesaid judicial pronouncements, we find that in all the cases, the levy of late fee charged by the Assessing Officer has been directed to be deleted. Since the issue for our adjudication is squarely covered by the aforesaid decisions and in this view of the matter that in all these cases the default committed by
Ms. Shephali Anil Malviya Shri Vinod Pandharinath Duragkar
the assessee for the quarters prior to 1st June 2015, hence, we hold that the charging of late filing fee under section 234E of the Act do not have legs to stand and hence set aside the impugned orders passed by the learned CIT(A) in all the appeals under consideration and direct the Assessing Officer to delete the charging of late filing fee. Accordingly, the grounds raised by the assessee in all these appeals are allowed.
ITA no.129 & 130/Nag./2021 Shri Vinod Pandharinath Duragkar
In this appeal also, the assessee has raised the same issue of charging of late filing fee under section 234E of the Act.
The issue for our adjudication is decided by us vide Para–7 & 8 of this order. The grounds of appeal raised by the assessee being mutatis mutandis identical to the set of facts and circumstances cited supra, respectfully following the same, we hold that the learned CIT(A) was not justified in confirming the orders passed by the Assessing Officer levying charge of late filing fee under section 234E of the Act in all the appeals under consideration. Consequently, we set aside the impugned orders passed by the learned CIT(A) in all the appeals and direct the Assessing Officer to delete the charging of late
Ms. Shephali Anil Malviya Shri Vinod Pandharinath Duragkar
filing fee. Accordingly, the grounds raised by the assessee in all these appeals are also allowed.
In the result, assessee’s appeals (Ms. Shephali Anil Malviya) being appeal in ITA no.115 to 119/Nag./2021 as well as assessee’s appeal (Shri Vinod Pandharinath Duragkar) being appeal in ITA no. 129 and 130/Nag./2021, allowed. Order pronounced in the open court on 26/04/2022
Sd/- Sd/- SANDEEP GOSAIN ARUN KHODPIA JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI, DATED: 26/04/2022 Copy of the order forwarded to: (1) The Assessee; (2) The Revenue; (3) The CIT(A); (4) The CIT, Nagpur City concerned; (5) The DR, ITAT, Nagpur; (6) Guard file. True Copy By Order
Assistant Registrar ITAT, Mumbai