Section 220(2) of the Income Tax Act
Income-tax Act, 2025: s.411
Section 220(2) falls under section 220 of the Income-tax Act, 1961, which corresponds to section 411 (When tax payable and when assessee deemed in default) of the Income-tax Act, 2025.
Read section 411 of the 2025 Act
Correspondence checked against the ICAI tabular mapping of the two Acts and the BharatTax.co section commentary.
The decision most relied on for Section 220(2) is Fatehraj Singhvi v. UOI (73 Taxmann.com 252), cited in 1,778 of the 550 judgments on BharatTax that turn on this section.
Leading authorities on Section 220(2)
Late fees under section 234E are not applicable for periods prior to June 1, 2015, as the amendment to section 200A inserting clause (c) was effective from that date.
The fee under Section 234E for late filing of TDS/TCS statements cannot be levied retrospectively by processing an intimation under Section 200A for defaults occurring before the amendment allowing such processing.
A fee under Section 234E cannot be levied or adjusted in an intimation under Section 200A for TDS statements pertaining to periods prior to June 1, 2015, as the enabling amendment to Section 200A(1)(c) came into effect only from that date.
Section 234E, levying late fees for delayed filing of TDS statements under section 200(3), is constitutionally valid and constitutes a compensatory fee, not a punitive penalty. Before treating any person as an assessee-in-default, an opportunity of being heard must be provided.
The fee under Section 234E of the Income-tax Act cannot be levied for defaults in filing TDS statements committed prior to June 1, 2015, as the provision for its levy became effective only from that date.
Late fees under section 234E can only be levied prospectively from June 1, 2015. Levying late fees for periods prior to this date is not permissible.
The imposition of fees for late filing of TDS/TCS returns prior to the Finance Act, 2015 amendments was not illegal, and the Rajasthan High Court found no justification to interfere with such compensatory fees.
Section 234E fee cannot be imposed for periods prior to June 1, 2015. This applies even when the processing of the return under Section 200A(c) occurred before that date.
The Madras High Court has upheld the validity of the levy of fees under Section 234E and penalties under Section 271H, finding the charging provision to be Section 234E, with the power to levy existing from 01/07/2012.