2022 (2) TMI 1340 - AT - Income Tax

Levy of late filing fee u/s 234E - quarterly return filed by the tax deductor for the period prior to 01.06.2015 - HELD THAT - We find that the assessment years involved are prior to 01.06.2015. Therefore, we are of the considered view that the late fee charged by the Assessing Officer under section 234E of the Act, while processing quarterly TDS return under section 200A of the Act, is without any authority and invalid. Hence, by respectfully following the decision of Fatheraj Singhvi v. Union of India 2016 (9) TMI 964 - KARNATAKA HIGH COURT we are of the considered view that the Assessing Officer cannot levy late fee while processing of TDS return under section 200A of the Act upto the financial year 2014-15. Since, late fee charged in the present case pertaining to the financial year 2013-14, we direct the Assessing Officer to delete the late fee charged under section 234E of the Act in the intimation issued under section 200A of the Act for the processing of quarterly TDS return filed by the assessee. Appeals filed by the assessee are allowed.

Summary

Issues:
- Condensation of delay in filing appeals
- Levy of late fee under section 234E of the Income Tax Act
- Validity of late fee for quarterly TDS returns filed prior to 01.06.2015

Condensation of Delay in Filing Appeals:
The appeals filed by the assessee were found to be barred by a limitation of 11 days. The assessee sought condonation of this delay, which was granted by the tribunal. The tribunal considered the reasons provided by the assessee for the delay in filing the appeal as reasonable cause under the Act for condonation of delay. Consequently, the appeals were admitted for adjudication.

Levy of Late Fee under Section 234E of the Income Tax Act:
The case involved the assessee filing TDS quarterly returns beyond the due date specified under the Income Tax Act for assessment years 2013-14 & 2015-16. The Assessing Officer had levied late filing fees under section 234E of the Act. The assessee challenged this levy before the CIT(A), who dismissed the appeals on grounds of limitation and merits. The tribunal considered the issue of whether the Assessing Officer could levy late fees under section 234E when quarterly returns were filed prior to 01.06.2015. Various courts had addressed this issue, with the Karnataka High Court ruling that without an enabling provision in section 200A, late fees under section 234E could not be levied for periods before 01.06.2015. Following this precedent, the tribunal held that the late fee charged by the Assessing Officer for the financial year 2013-14 was without authority and invalid. Consequently, the tribunal directed the Assessing Officer to delete the late fee charged under section 234E for the processing of quarterly TDS returns filed by the assessee.

Validity of Late Fee for Quarterly TDS Returns Filed Prior to 01.06.2015:
The tribunal, after analyzing the legal provisions and court decisions, concluded that late fees under section 234E of the Act could not be levied for periods prior to 01.06.2015 due to the absence of enabling provisions. Relying on the Karnataka High Court and Kerala High Court decisions, the tribunal held that the Assessing Officer cannot levy late fees under section 234E while processing TDS returns under section 200A for periods up to the financial year 2014-15. Consequently, the tribunal allowed the appeals filed by the assessee in this regard.

In conclusion, the tribunal allowed the appeals filed by the assessee, directing the deletion of late fees charged under section 234E for the processing of quarterly TDS returns filed for the financial year 2013-14. The decision was based on the absence of enabling provisions prior to 01.06.2015, following precedents set by the Karnataka and Kerala High Courts.