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2018 (12) TMI 402 - AT - Income TaxFee levied u/s 234E - TDS returns belatedly filed by the assessee for the assessment years 2013-14 to 2015-16 - as per assessee the provisions of section 234E were made applicable for the purposes of section 200A only from 01.06.2015 and are, therefore, not applicable for the assessment years under consideration - Diversified views - Held that - Section 200A lays down the manner in which the statements of tax deducted at source are to be processed for issuing the intimation. First of all, the sums deductible under the Chapter are to be computed and interest, if any, shall be computed on the basis of such sums deductible as computed in the statements as per clause (a) and (b) under section 200A(1) of the Act. Clauses (c) to (f) reproduced above were substituted for clauses (c) to (e) by the Finance Act, 2015 w.e.f. 01.06.2015. As per newly substituted clause (c) w.e.f. 01.06.2015, the fees, if any, is to be computed in accordance with the provisions of section 234E of the Act. However, under the earlier clause (c), there was no such provision. As held State Bank of India v. ITO(TDS) 2018 (6) TMI 284 - ITAT AGRA as prior 01.06.2015, there was no enabling provision in the Act u/s 200A for raising demand in respect of levy of fee u/s 234E of the Act. The provision of Section 234E is charging provision i.e. substantive provision which could not be applied retrospectively, unless it is expressly provided in the Act, to levy the late fee for any delay in filing the TDS statement for the period prior to 01.06.2015. Substitution made by clause (c) to (f) of sub-section (1) of Section 200A can be read as having prospective effect and not having retroactive character or effect. The demand under Section 200A for computation and intimation for the payment of fee under Section 234E could not be made in purported exercise of power under Section 200A by the respondent for the period of the respective assessment year prior to 1.6.2015. - Decided in favour of assessee.
Issues Involved:
1. Applicability of Section 234E of the Income Tax Act for late filing fees on TDS statements prior to 01.06.2015. 2. Authority of the Assessing Officer to levy fees under Section 234E while processing TDS statements under Section 200A before 01.06.2015. 3. Maintainability of appeals against intimation issued under Section 200A of the Act. Comprehensive, Issue-Wise Detailed Analysis: 1. Applicability of Section 234E of the Income Tax Act for Late Filing Fees on TDS Statements Prior to 01.06.2015: The primary issue in this batch of appeals is the levy of fees under Section 234E of the Income Tax Act for late filing of TDS statements for the assessment years 2013-14 to 2015-16. The assessee contended that the provisions of Section 234E were applicable for the purposes of Section 200A only from 01.06.2015, and hence, the fees should not be levied for periods before this date. The Tribunal examined the provisions of Section 200A, which outlines the manner in which TDS statements are to be processed. It was noted that clauses (c) to (f) of Section 200A(1) were substituted by the Finance Act, 2015, effective from 01.06.2015. The newly substituted clause (c) allowed for the computation of fees in accordance with Section 234E, which was not present in the earlier version of the clause. 2. Authority of the Assessing Officer to Levy Fees under Section 234E while Processing TDS Statements under Section 200A Before 01.06.2015: The Tribunal relied on various judgments, including Gajanan Construction v. DCIT, which held that the amendment to Section 200A(1) is procedural and does not empower the Assessing Officer to charge fees under Section 234E while processing TDS statements for periods before 01.06.2015. The intimation issued by the Assessing Officer under Section 200A for these periods was deemed invalid, and the demand raised by charging fees under Section 234E was deleted. The Tribunal also referenced the case of M/s. Palanisamy Gounder Charitable Trust v. ITO, where it was held that the power to collect fees vested in the authority only by the substitution of clause (c) to Section 200A(1) by the Finance Act, 2015, effective from 01.06.2015. Therefore, the Assessing Officer was not empowered to charge fees under Section 234E while processing TDS returns filed before this date. 3. Maintainability of Appeals Against Intimation Issued Under Section 200A of the Act: The Tribunal addressed whether an appeal is maintainable against the intimation issued under Section 200A of the Act. It was held that such intimation is appealable under Section 246A of the Act, as it is deemed a notice of payment under Section 156 of the Act. The Tribunal reversed the findings of the CIT(A) on this matter and admitted the appeals. The Tribunal cited the Finance Bill, 2015, which recognized that an intimation generated after processing TDS statements is subject to rectification under Section 154, appealable under Section 246A, and deemed a notice of payment under Section 156. Therefore, the CIT(A) should have examined the legality of adjustments made under the intimation issued under Section 200A. Conclusion: The Tribunal concluded that the Assessing Officer was not empowered to levy fees under Section 234E while processing TDS statements for periods before 01.06.2015. The intimation issued by the Assessing Officer was beyond the scope of adjustment provided under Section 200A and was thus invalid. The Tribunal set aside the orders of the CIT(A) and directed the deletion of fees levied under Section 234E for the assessment years 2013-14 to 2015-16. All appeals filed by the assessee were allowed.
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