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2021 (2) TMI 859 - AT - Income TaxLevy of late fees u/s. 234E - delay in filing of TDS statement - scope of section 200A r.w.s 200(3) - main thrust of Ld. A.R. of the assessee is that levy of late fees u/s. 234E cannot be made before 1.6.2015 - HELD THAT - As decided in TB and ID Hospital vs. ITO 2018 (8) TMI 1550 - ITAT CUTTACK all matters, the intimation given in purported exercise of power under Section 200A are in respect of fees under Section 234E for the period prior to 1.6.2015. As such, it is on account of the intimation given making demand of the fees in purported exercise of power under Section 200A, the same has necessitated the appellant-original petitioner to challenge the validity of Section 234E of the Act. In view of the reasons recorded when the amendment made under Section 200A of the Act which has come into effect on 1.6.2015 is held to be having prospective effect, no computation of fee for the demand or the intimation for the fee under Section 234E could be made for the TDS deducted for the respective assessment year prior to 1.6.2015. Hence, the demand notices under Section 200A by the respondent authority for intimation for payment of fee under Section 234E can be said as without any authority of law and the same are quashed and set aside to that extent. Decided in favour of assessee.
Issues:
Appeals against orders of CIT(A) for assessment years 2013-14, 2014-15 & 2015-16 - Levy of late fees u/s. 234E of the Income Tax Act, 1961. Analysis: The appeals by the assessee challenged the levy of late fees u/s. 234E for the mentioned assessment years. The contention was that prior to the insertion of section 200A w.e.f. 1.6.2015, the levy of late fees u/s. 234E could not be made. The assessee relied on decisions of ITAT Cuttack and ITAT Mumbai where late fees were deleted under similar circumstances. The Department did not dispute the submissions made by the assessee. The Tribunal noted that the main issue was the timing of the levy of late fees u/s. 234E, which cannot be made before 1.6.2015. Referring to previous decisions, the Tribunal found that the levy of late fees before 1.6.2015 was not valid. The Tribunal highlighted the decision of the Hon'ble Karnataka High Court, stating that prior to 1.6.2015, the Assessing Officer did not have the authority to levy fees u/s. 234E while issuing intimation u/s. 200A. The Tribunal relied on the Karnataka High Court's judgment and quashed the intimation for fee under section 234E, setting aside the lower authorities' decisions. The Tribunal emphasized that the amendment to Section 200(3) of the IT Act was effective only from June 1, 2015, and any levy of fee u/s. 234E before this date was beyond the scope of the law. Consequently, the Tribunal deleted the levy of late fees u/s. 234E for the relevant quarters in the mentioned assessment years, in line with the judicial precedent and allowed the appeals filed by the assessee. In conclusion, the Tribunal allowed the appeals, deleting the levy of late fees u/s. 234E for the specified assessment years based on the legal interpretation that the Assessing Officer lacked the authority to impose such fees before 1.6.2015. The decision was in line with the precedent set by the Hon'ble Karnataka High Court and previous Tribunal rulings, emphasizing the prospective effect of statutory provisions and the need for compliance with the law's timelines and procedures.
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