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2016 (4) TMI 129 - AT - Income TaxLevy of fees under section 234E - intimation issued under section 200A in respect of processing of TDS - Held that - We find that the issue in all these appeals is now squarely covered in favour of the assessee by the decision of ITAT Amritsar Bench in the case of Sibia Healthcare Private Limited vs. DCIT 2015 (6) TMI 437 - ITAT AMRITSAR adjustment in respect of levy of fees under section 234E was indeed beyond the scope of permissible adjustments contemplated under section 200A. As intimation under section 200A, raising a demand or directing a refund to the tax deductor, can only be passed within one year from the end of the financial year within which the related TDS statement is filed and that time has already elapsed and the defect is thus not curable even at this stage. In view of these discussions, as also bearing in mind entirety of the case, the impugned levy of fees under section 234E is unsustainable in law. We, therefore, delete the impugned levy of fee under section 234E of the Act. - Decided in favour of assessee.
Issues:
Late filing fee under section 234E of the Income Tax Act for the quarter 1 of the Asstt. Year 2014-15. Analysis: The appeal was filed against the order of the ld.CIT(A) upholding the late filing fee of ?5,600/- for the quarter 1 of the Asstt. Year 2014-15 imposed by the AO under section 234E of the Income Tax Act. The counsel for the assessee argued that the late payment under section 234E was levied before the amendment to section 200A of the Income Tax Act. The Tribunal followed the order of the ITAT, Amristar Bench in the case of Sibia Healthcare P. Ltd. Vs. DCIT, and reproduced the relevant part of the order. The Tribunal highlighted that the issue required adjudication on a short legal issue within a narrow compass of material facts. The Tribunal discussed the provisions of sections 234E and 200A of the Income Tax Act. Section 234E deals with the fee for defaults in furnishing statements, while section 200A relates to the processing of statements of tax deducted at source. The Tribunal emphasized that post 1st June 2015, an adjustment could be made in the processing of TDS statements in accordance with the provisions of section 234E. However, prior to this amendment, the scope of adjustments under section 200A was limited to arithmetical errors, incorrect claims, and interest computation based on sums deductible. The Tribunal concluded that the adjustment in respect of the levy of fees under section 234E was beyond the permissible adjustments contemplated under section 200A, as it stood before the June 2015 amendment. The intimation under section 200A was deemed appealable, and the CIT(A) should have examined the legality of the adjustment in light of the scope of section 200A. As the levy was made before the enabling provision under section 200A came into effect, it was deemed unsustainable in law. The Tribunal upheld the assessee's grievance and deleted the impugned levy of fee under section 234E. The Departmental Representative did not present any other judgment to negate the Tribunal's finding. Consequently, following the precedent set by previous orders, the Tribunal allowed the appeal of the assessee and deleted the levy of late fee imposed under section 234E for the quarter-1 of the assessment year 2014-15. The appeal of the assessee was allowed, and the order was pronounced on 1st April 2016 at Ahmedabad. This detailed analysis of the judgment highlights the legal arguments, statutory provisions, and the Tribunal's reasoning in deciding the appeal against the levy of late filing fees under section 234E of the Income Tax Act.
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