NLDK TIMBERS PRIVATE LIMITED,NEW DELHI vs. DCIT, CIRCLE-11(1), NEW DELHI

The common dispute arising in the appeals relates to levy of late filing fee under section 234E of the Income-tax Act, 1961.

Briefly, the facts are, for various quarters of financial years 2012-13 and 2013-14, the assessee filed its TDS statements in terms of section 200 of the Act. While processing the TDS statements under section 200A of the Act, the Centralized Processing Centre (CPC), having found that the TDS statements were furnished beyond prescribed time limit, levied fee under section 234E of the Act in terms of section 200A(1)(c) of the Act. Though, the assessee filed applications under section 154 of the Act objecting to levy of fee under section 234E of the Act and seeking rectification thereof, however, the applications were rejected. Being aggrieved, the assessee filed appeals before learned first appellate authority.

Before us, learned counsel appearing for the assessee submitted that prior to 01.06.2015, the Assessing Officer had no authority to levy fee under section 234E of the Act while processing the TDS statements under section 200A of the Act. Thus, he submitted, in absence of any enabling provision under section 200A prior to 01.06.2015, the Assessing Officer could not have levied fee under section 234E of the Act for any quarter falling prior to 01.06.2015. In support of such contention, he relied upon the following decisions :

Learned Departmental Representative relied upon the observations of learned first appellate authority.

We have considered rival submissions and perused materials on record. The short issue arising for consideration before us in the present appeals is, whether, the Assessing Officer is competent to levy late filing fee under section 234E of the Act for any period prior to 01.06.2015 while processing the TDS statement under section 200A of the Act. On a careful reading of section 234E and section 200A of the Act together, we have noticed that though, section 234E of the Act providing for levy of late filing fee was introduced to the Statute by Finance Act, 2012 w.e.f. 01.07.2012, however, there was no enabling provision under section 200A of the Act, vesting authority on the Assessing Officer to levy such fee while processing the TDS statement. By virtue of an amendment brought in by Finance Act, 2015 w.e.f. 01.06.2015, clause (c) was introduced to sub-section (1) of section 200A, which enabled the Assessing Officer to levy late filing fee under section 234E of the Act. In case of Fatehraj Singhvi vs. Union of India (supra) the Hon’ble Karnataka High Court has held that since, the introduction of clause (c) to section 200A(1) was effective from 01.06.2015, no late filing fee under section 234E can be imposed for a period prior to 01.06.2015. Though, we are conscious of a contrary view expressed by Hon’ble Gujrat High Court in case of Rajesh Rajeev Kourani vs. Union of India, 83 taxmann.com 137, however, as held by Hon’ble Supreme Court in case of CIT vs. M/s. Vegetable Products Limited, 88 ITR 192, in case, there are conflicting decisions on identical issue, the view favourable to the assessee has to be taken. Following the aforesaid age old legal principle, the coordinate Bench in case of ICMC Projects Pvt. Ltd. vs. ITD, CPC (supra) and Bathline India (P) Ltd. vs. ACIT (supra) has held that no fee under section 234E can be charged for any period prior to 01.06.2015 while processing the TDS statement under section 200A of the Act. Thus, respectfully following the aforesaid decisions of the coordinate Bench, as also the decision of Hon’ble Karnataka High Court in case of Fatehraj Singhvi vs. UOI (supra), we hold that since the periods involved in the present appeals are falling prior to 01.06.2015, the Assessing Officer/CPC was not authorised to levy fee under section 234E of the Act while processing the TDS statements filed by the assessee. Accordingly, we decide the issue in favour of the assessee. Grounds are allowed.

In the result, appeals are allowed.