2016 (3) TMI 493 - AT - Income Tax

Levy of fee u/s 234E in the order u/s 200A - Held that - The adjustment in respect of levy of fees under section 234E was indeed beyond the scope of permissible adjustments contemplated under section 200A. In view of these discussions, as also bearing in mind entirety of the case, the impugned levy of fees under section 234 E is unsustainable in law. We, therefore, uphold the grievance of the assessee and delete the impugned levy of fee under section 234E of the Act. - Decided in favour of assessee

Summary

Issues Involved:
Levy of late filing fee under section 234E for the 3rd Quarter of AY 2013-14 in respect of quarterly TDS statement.

Detailed Analysis:

1. Legal Precedents and Interpretation of Section 234E:
The appeal was filed against the order confirming the levy of late filing fee under section 234E for the 3rd Quarter of AY 2013-14. The Authorized Representative for the assessee cited a judicial precedent where a similar issue was decided in favor of the assessee based on the interpretation of section 234E. The ITAT Amritsar Bench decision in the case of Sibia Healthcare Private Ltd vs. DCIT was referred to, emphasizing that the levy of fees under section 234E was beyond the scope of permissible adjustments under section 200A. The ITAT held that the adjustment for the late filing fee was not sustainable under the law as it existed at that time.

2. Amendment in Section 200A and Post-June 2015 Scenario:
The judgment highlighted the amendment in Section 200A introduced by the Finance Act 2015, effective from 1st June 2015. This amendment allowed for the computation of fees in accordance with section 234E during the processing of TDS statements. However, the impugned order in this case was passed before the amendment came into effect. The ITAT ruled that the levy of late filing fees under section 234E was not permissible based on the law prevailing at the time of the order.

3. Decision and Ruling of the ITAT:
Considering the legal precedents and the interpretation of relevant sections, the ITAT upheld the appeal filed by the assessee and deleted the late filing fees charged under section 234E. The ITAT relied on the decision of a Coordinate Bench in a similar case and concluded that the late fee charged from the assessee was not justified. The order was pronounced in favor of the assessee on 3rd February 2016 in Ahmedabad.

In conclusion, the ITAT ruled in favor of the assessee, emphasizing that the levy of late filing fees under section 234E was not permissible based on the legal provisions applicable at the time of the order. The judgment provided a detailed analysis of the legal precedents and statutory provisions to support the decision to delete the late filing fees imposed on the assessee.