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2015 (10) TMI 2541 - AT - Income TaxLevy of fees under section 234E - intimation issued under section 200A in respect of processing of TDS - Held that - We find that the issue in all these appeals is now squarely covered in favour of the assessee by the decision of ITAT Amritsar Bench in the case of Sibia Healthcare Private Limited vs. DCIT 2015 (6) TMI 437 - ITAT AMRITSAR adjustment in respect of levy of fees under section 234E was indeed beyond the scope of permissible adjustments contemplated under section 200A. The impugned levy of fees under section 234E is unsustainable in law. We, therefore, delete the impugned levy of fee under section 234E of the Act. - Decided in favour of assessee.
Issues Involved:
1. Levy of fees under section 234E of the Income Tax Act. 2. Intimation under section 200A of the Income Tax Act. 3. Applicability of amendments to section 200A effective from 01.06.2015. Issue-wise Detailed Analysis: 1. Levy of Fees under Section 234E of the Income Tax Act: The primary issue in all the appeals was the levy of fees under section 234E for late filing of TDS statements. The assessee contended that the intimation was passed without providing any opportunity of being heard, as the late filing was due to a technical error and not due to any loss to the revenue. The CIT(A) noted that late fees under section 234E are mandatory and cannot be waived, dismissing the assessee's appeals. The Tribunal, however, observed that the provision for computing fees under section 234E was inserted into section 200A(1)(c) effective from 01.06.2015. Since the cases pertained to periods before this date, the Tribunal held that no fee could be levied under section 234E for those periods. 2. Intimation under Section 200A of the Income Tax Act: The Tribunal examined whether the levy of fees under section 234E could be made during the processing of TDS statements under section 200A. It was noted that prior to the amendment effective from 01.06.2015, section 200A did not provide for the levy of fees under section 234E. The Tribunal referenced the ITAT Amritsar Bench's decision in Sibia Healthcare Private Ltd. v. DCIT (TDS), which concluded that adjustments for fees under section 234E were beyond the scope of permissible adjustments under section 200A as it stood before the amendment. Consequently, the Tribunal found that the intimation under section 200A for periods before 01.06.2015 could not include fees under section 234E. 3. Applicability of Amendments to Section 200A Effective from 01.06.2015: The Tribunal highlighted that the amendment to section 200A, which allowed for the computation of fees under section 234E, came into effect from 01.06.2015. This amendment was not applicable to the assessment years in question, which were prior to this date. As such, the Tribunal held that the levy of fees under section 234E through intimation under section 200A for periods before 01.06.2015 was not permissible. The Tribunal also referenced decisions from other benches, including the ITAT Chandigarh Bench and the Chennai Bench, which supported this view and had similarly deleted fees levied under section 234E for periods before the amendment. Conclusion: The Tribunal concluded that the Assessing Officer had exceeded his jurisdiction in levying fees under section 234E while processing TDS statements under section 200A for periods prior to 01.06.2015. The intimation under section 200A was set aside, and the fees levied were deleted. The Tribunal allowed all the appeals of the assessee, providing relief from the fees levied under section 234E. The Tribunal clarified that the issue of constitutional validity of section 234E, upheld in other judicial decisions, was not relevant to the present appeals, which focused on the procedural aspect under section 200A.
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