2021 (3) TMI 1417 - AT - Income Tax

Levy of late filing fee u/s. 234E r.w.s. 221(1) - Intimation u/s 200A - As contended that prior to the amendment u/s. 200A w.e.f. 1.6.2015, levy of fee u/s. 234E during processing of the TDS statement was not tenable - HELD THAT - Issue of amendment in Section 200A(1) of the Act has become very much a debatable issue, we therefore AO while processing the TDS statements, returns in the present set of appeals of the period prior to 1.6.2015, ought not to have charged fee u/s. 234E hence, the intimation issued by the AO u/s. 200A of the Act, in the appeals before us, does not stand, therefore, the demand raised by way of charging fee u/s. 234E of the Act is not valid and the same is deleted for the prior period 1.6.2015, is beyond the scope of adjustment provided u/s. 200A of the Act. The impugned demands are delete therefore. Assessee appeal allowed.

Summary

Issues involved:
1. Levy of late filing fee under Section 234E r.w.s. 221(1) of the Income Tax Act, 1961 for the assessment years 2013-14 to 2015-16.

Analysis:

Issue 1: Levy of late filing fee under Section 234E r.w.s. 221(1) of the Income Tax Act, 1961
The appellant's appeals for the assessment years 2013-14 to 2015-16 were based on the Commissioner of Income Tax (Appeals)-4, Hyderabad's common order dated 25.06.2018. The appellant contended that the CIT(A) erred in confirming the levy of late filing fee under Section 234E r.w.s. 221(1) of the Act. The authorized representative argued that prior to the amendment under Section 200A of the Act from 1.6.2015, the levy of the fee during the processing of the TDS statement was not permissible. The appellant relied on decisions of the ITAT, Delhi Benches, including M/s. Samikaran Learning Pvt. Ltd. Vs. TDS Officer, Delhi and Dharam Deep Public School & Another Vs. DCIT. The departmental representative supported the CIT(A)'s orders. The ITAT, Hyderabad, after considering the decisions of the ITAT, Delhi Benches, which in turn relied on various High Courts and the Supreme Court's decision in the case of Vegetable Products 88 ITR 192 (SC), held that the issue of the amendment in Section 200A(1) of the Act was debatable. The ITAT concluded that the Assessing Officer should not have charged the fee under Section 234E of the Act for the period before 1.6.2015. Therefore, the demand raised for charging the fee under Section 234E was deemed invalid, and the same was deleted for the prior period. The ITAT allowed the appellant's appeals, and the impugned demands were deleted accordingly.

This judgment by the ITAT Hyderabad, delivered by Shri S.S. Godara, J.M., and Shri Laxmi Prasad Sahu, Accountant Member, set a precedent regarding the levy of late filing fees under Section 234E r.w.s. 221(1) of the Income Tax Act, 1961. The decision highlighted the significance of the amendment in Section 200A(1) of the Act from 1.6.2015 and the debatable nature of the issue. The judgment emphasized the importance of legal precedents and decisions from higher courts in determining the validity of charges imposed by the Assessing Officer. Ultimately, the ITAT ruled in favor of the appellant, emphasizing the incorrectness of charging the fee under Section 234E for the relevant period. This comprehensive analysis showcases the meticulous consideration of legal provisions and precedents by the ITAT Hyderabad, resulting in a favorable outcome for the appellant.