2019 (10) TMI 1253 - AT - Income Tax

Levy of fee u/s 234E - Scope of amendment to section 200A - HELD THAT - Only by Finance Act, 2015 Clause (c) was introduced to section 200A providing for levy of fee u/s 234E of the Act while processing the statement of TDS u/s. 200A of the Act. Further, the aforesaid amendment to section 200A was made effective from 01.06.2015. Thus, admittedly, prior to the aforesaid amendment, the Assessing Officer had no authority in law to levy fee u/s. 234E while processing the statement of TDS u/s. 200A. Incidentally, in the facts of the present case, not only the period for which fee u/s. 234E has been levied is prior to 01.06.2015, but even the order u/s. 200A was passed by the Assessing Officer prior to the aforesaid amendment to section 200A. Now it is fairly well-settled by virtue of various judicial pronouncements on the issue that amendment to section 200A providing for levy of fee u/s. 234E of the Act, would apply prospectively to a period following after 01.06.2015. That being the case, the levy of fee u/s. 234E of the Act in the facts of the present case is invalid. Accordingly, we delete the late filing fee. - Decided in favour of assessee.

Summary

Issues:
Levy of fee u/s 234E of the Act for the second quarter of F Y 2012-13.

Detailed Analysis:
The appeal was against the order confirming the levy of fee u/s 234E of the Act for the second quarter of F Y 2012-13. The Assessing Officer charged a fee for late filing of TDS statements by the assessee. The CIT(A) upheld the levy of the fee stating that it was not in the nature of an adjustment, thus not allowing the assessee to appeal u/s 246A of the Act. Despite the assessee challenging the levy, the appeal was dismissed. The assessee did not appear for the hearing, leading to an ex-parte disposal of the appeal. The main contention raised by the assessee was that the Assessing Officer had no authority to levy the fee u/s 234E before the relevant amendment was made. The amendment introducing the provision for the levy of fee u/s 234E while processing TDS statements u/s 200A was made effective from 01.06.2015. As the fee was imposed before this amendment, and the order was passed prior to the amendment, the tribunal held that the levy of the fee was invalid. It was established through judicial precedents that the amendment applied prospectively from 01.06.2015, rendering the fee invalid in this case. Consequently, the tribunal allowed the assessee's appeal and deleted the late filing fee of &8377; 50,450.

In conclusion, the tribunal found that the levy of fee u/s 234E of the Act for the second quarter of F Y 2012-13 was invalid as the Assessing Officer did not have the authority to impose the fee before the relevant amendment was made effective. The tribunal, based on established legal principles, ruled in favor of the assessee, allowing the appeal and deleting the late filing fee.