2017 (10) TMI 1535 - AT - Income Tax

Levying fee u/s 234E - Late filing of TDS returns / statement - statement processed u/s 200A - HELD THAT - Late fee is chargeable w.e.f. 1.6.2015. Therefore, the provisions of section 234E are not applicable in the financial years under consideration. We delete the levy of late fee u/s. 234E for the 2nd quarter of financial year 2012-13, for the third quarter of financial year 2012-13, for the 4th quarter of financial year 2012-13, for the 1st quarter of financial year 2012-13 and for the 2nd quarter of financial year 20013-14 and allow the appeals of the assessee.

Summary

Issues involved:
Confirmation of late fee u/s.234E of the Income Tax Act, 1961 by CIT(A) for financial years 2012-13 and 2013-14.

Detailed Analysis:

Issue 1: Late Fee u/s.234E
The appeals were filed against the orders of CIT(A) confirming the late fee levied by DCIT under section 234E of the Income Tax Act, 1961. The assessee did not appear, and an adjournment request was rejected. The Tribunal proceeded ex-parte and considered the arguments of the Revenue. The Revenue contended that late fee cannot be charged for the financial years 2012-13 and 2013-14 based on a judgment by the Karnataka High Court. The Tribunal referred to its own previous decision in the case of Gyanaranjan Ray vs ITO (TDS), Cuttack, where it was held that the AO cannot levy fee u/s 234E before 1.6.2015. The Tribunal relied on the Karnataka High Court's judgment and set aside the late fee levied by the lower authorities for the financial year 2013-14. The late fee was found to be chargeable only from 1.6.2015 onwards, making the provisions of section 234E inapplicable for the financial years under consideration.

Issue 2: Judicial Precedents
The Tribunal compared the judgments of different High Courts, including the Karnataka High Court and the Punjab and Haryana High Court, regarding the levy of late fee u/s 234E. In the absence of a specific order from the jurisdictional High Court, the Tribunal followed the order that favored the assessee, as per established legal principles. The Tribunal emphasized that the AO can only levy fee under section 234E after 1.6.2015 while processing statements under section 200A, as per the Karnataka High Court's ruling. The Tribunal quashed the intimation of late fee under section 234E and deleted the fee levied in the appeals before them for the financial years 2012-13 and 2013-14.

Conclusion:
The Tribunal allowed all the appeals filed by the assessee, setting aside the late fee levied under section 234E for the relevant financial years. The decision was based on the interpretation of the law and judicial precedents, particularly the ruling of the Karnataka High Court regarding the retrospective application of late fee provisions.