2018 (12) TMI 1318 - AT - Income Tax

Levy of fee under Section 234E - processing the TDS statement furnished by the assessee u/s 200A - Fee for default in furnishing statements - Held that - Prior to 01.06.2015, there was no enabling provision in Section 200A of the Act for making adjustment in respect of the statement filed by the assessee with regard to tax deducted at source by levying fee under Section 234E. The Parliament for the first time enabled the Assessing Officer to make adjustment by levying fee under Section 234E of the Act with effect from 01.06.2015. See SMT. G. INDHIRANI, SALEM, RAJAGURU SPINNING MILLS LTD., A. DHAKSHINAMURTHY , PADMA TEXTILES & MURTHY LUNGI COMPANY VERSUS THE DEPUTY COMMISSIONER OF INCOME TAX, CPC TDS, TDS CPC, UTTAR PRADESH 2015 (7) TMI 640 - ITAT CHENNAI As held by this ITAT, the intimation sent to the assessee u/s. 200A dated 16.01.2014 raising the demand of ₹ 9,000/- u/s. 234E towards levy of late filing fee is invalid as there was no enabling provision in section 200A, viz., clause (1)(C) of section 234E, prior to 01.06.2015 for levy of fees u/s. 234E while processing the statement of tax deducted at source. It was open for the AO to pass separate order u/s. 234E levying the fee, provided the limitation for such a levy did not expire. However, in this case, the AO has not passed any order u/s. 234E independently within 31.03.2015 and hence, the impugned order is set aside. - Decided in favour of assessee.

Summary

Issues:
Appeal against order of Commissioner of Income-tax (Appeals) regarding levy of fee u/s. 234E while processing statement u/s. 200A before 01-06-2015 for assessment year 2013-14.

Analysis:
The appeals were filed by different assessees against orders of the Commissioner of Income-tax (Appeals)-2(i/c), Madurai for assessment year 2013-14. None represented the Assessee, while Mr. Clement Ramesh Kumar represented the Revenue. As all appeals involved the same issue, they were disposed of by a common order.

The assessee submitted written points regarding the assessment year 2013-2014, focusing on the assessing authority's ability to levy fee u/s. 234E while processing the statement u/s. 200A before 01-06-2015. The assessee relied on a decision of a Co-ordinate Bench of the Tribunal, arguing that the assessing officer exceeded jurisdiction in levying the fee. The Revenue presented the order of the Gujarat High Court in a different case, emphasizing that section 200A is a machinery provision and cannot override the charging provision of section 234E.

After considering the submissions, the Tribunal noted that the Gujarat High Court decision was specific to the amendment to Section 234E from 01-06-2015 and did not address the levy of interest u/s. 234E before the amendment. Referring to previous decisions of the Tribunal, the Tribunal held that the assessing officer had exceeded jurisdiction in levying the fee u/s. 234E while processing the statement and making adjustments u/s. 200A. The Tribunal allowed the appeals, setting aside the intimation of the lower authorities levying the fee u/s. 234E and deleting the fee levied.

In conclusion, the Tribunal allowed all appeals filed by the assessees, ruling in favor of setting aside the levy of fee u/s. 234E while processing statements u/s. 200A before 01-06-2015 for assessment year 2013-14.