2020 (10) TMI 1326 - AT - Income Tax

Condonation of delay - Levy of late filing fee under section 234E of the Act for belated filing of TDS returns - assessee had filed appeals beyond due date for the reason that at the time of introducing section 234E by the Finance Act 2015 there was an ambiguity and no clear directions regarding levy of late filing fee under section 234E of the Act for belated filing of TDS returns - HELD THAT - In case the appeal is not filed within due date prescribed under the Act then it is for the assessee to give sufficient reasons which prevented from filing of appeal within due date but the reasons given by the assessee shall come within the expression sufficient cause . Various Courts and Tribunals have explained the term sufficient cause . As per the settled principle a case that arguable/favorable points/contention on merits should not be shut out on the presumption of limitation leading to such a case being thrown out at the threshold itself in limine. The Hon ble Supreme Court in the case of Collector Land Acquisition Vs. MST Katiji and Others 1987 (2) TMI 61 - SUPREME COURT while laying down principles for considering matters of condonation of delay in filing appeals have stated that substantial justice should prevail over technical considerations. ITAT Bangalore Bench in the case of Dr. C. Fernandes Co-operative 2019 (1) TMI 1059 - ITAT BANGALORE held that sufficient cause ought to be interpreted in a manner which subserves and advances cause of substantial justice. In this case on perusal of record we find that the reasons given by the assessee for not filing the appeals within the time allowed under the Act comes under the expression sufficient cause and hence we are of the considered view that learned CIT(A) erred in not condoning the delay in filing appeals. Therefore we condone the delay in filing appeals and restore the matter back to the file of the CIT(A) to decide the issues involved in these appeals on merits. Appeals filed by the assessee are treated as allowed for statistical purposes.

Summary

Issues:
Appeal against common order by CIT(A) for multiple assessment years - Delay in filing appeals - Condonation of delay - Levy of late filing fee under section 234E - Substantial justice over technical considerations.

Analysis:

1. Delay in filing appeals and Condonation of delay:
The assessee filed 11 appeals against a common order by the CIT(A) for assessment years 2013-14, 2014-15, and 2015-16. The appeals were filed beyond the due date specified under the Act. The assessee sought condonation of delay, explaining that the delay was due to ambiguity regarding the levy of late filing fee under section 234E. The ITAT found that the reasons given by the assessee for the delay were valid. The ITAT emphasized that substantial justice should prevail over technical considerations, citing the principle laid down by the Supreme Court. The ITAT held that the delay should be condoned, as the reasons provided by the assessee constituted "sufficient cause." The ITAT referred to a similar decision by the ITAT, Bangalore Bench, which interpreted "sufficient cause" in a manner that advances the cause of substantial justice. Therefore, the delay in filing appeals was condoned, and the matter was remanded back to the CIT(A) for deciding the issues on merits.

2. Levy of late filing fee under section 234E:
The Assessing Officer had levied late filing fees under section 234E for the delayed filing of TDS returns by the assessee. The CIT(A) dismissed the appeals filed by the assessee challenging the levy of late filing fee, stating that the assessee failed to provide sufficient reasons for the delay. However, the ITAT found that subsequent judgments by various High Courts and Tribunals clarified that no late fee could be charged under section 234E for returns filed before 01.06.2015. The ITAT noted that the assessee's explanation for the delay was valid, as the ambiguity regarding the levy of late fees had been resolved by judicial decisions. Therefore, the ITAT allowed the appeals for statistical purposes, emphasizing the importance of substantial justice in such matters.

The ITAT, Chennai, in a consolidated order, allowed the appeals filed by the assessee, emphasizing the need for substantial justice over technical considerations. The delay in filing the appeals was condoned based on valid reasons provided by the assessee, related to the ambiguity surrounding the levy of late filing fees under section 234E. The ITAT's decision highlighted the importance of interpreting "sufficient cause" in a manner that advances the cause of substantial justice, as established by previous judicial pronouncements.