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2023 (4) TMI 736 - AT - Income TaxLate filing fees u/s 234E and interest u/s 220(2) - HELD THAT - AO imposed late fees u/s 234E of the Act., where the enabling clause (c) was inserted in the section 200A w.e.f. 01.06.2015 and the same has been confirmed by the Ld. CIT(A) relying on the decision in the case of Rajesh Kaurani vs. Union of India 2017 (7) TMI 458 - GUJARAT HIGH COURT We find that late filing fee u/s 234E of the Act has not rightly been charged in the intimation issued u/s 200A/206CB of the Act while processing the TDS returns/statements as the enabling clause (c) having been inserted in the section w.e.f. 01.06.2015. No enabling provision in the Act u/s 200A for raising demand in respect of levy of fee u/s 234E. As such, as per the assessee, in respect of TDS statement filed for a period up to 29.06.2014, no late fee could be levied in the intimation issued u/s 200A - The details of the TDS deduction and statement filed by the assessee are available on record which were not disputed by the Revenue. As per Shri Fatehraj Singhvi and Ors 2016 (9) TMI 964 - KARNATAKA HIGH COURT and our own finding in the case of Sudershan Goyal 2018 (5) TMI 1626 - ITAT AGRA , we accept the grievance of the assessees as genuine. Accordingly, the orders of the CIT(A) are reversed, and the fee so levied u/s 234E of the Act is cancelled. Appeals of assessee are allowed.
Issues Involved:
The issues involved in the judgment are the imposition of late filing fees under section 234E along with interest under section 220(2) without providing an opportunity of being heard, the applicability of section 200A(1)(c) for late fees, the retrospective invocation of section 200A(1)(c), and the procedural aspects related to the levy of late fees. Late Filing Fees Imposition: The appeal was filed by the assessee against the order passed by the Commissioner of Income Tax (Appeals) National Faceless Appeal Centre (NFAC) for the assessment year 2014-15. The assessee challenged the levy of late filing fees under section 234E and interest under section 220(2) without being given an opportunity to be heard. The total amount demanded from the assessee for the financial year 2013-14 was Rs. 3,44,770, comprising late filing fees of Rs. 2,32,800 and interest of Rs. 1,11,970. The assessee contended that there was no provision to charge late fees under section 234E for the financial year 2013-14, as section 200A(1)(c) was inserted by the Finance Act, 2015, w.e.f. 01.06.2015. The assessee argued that the late fee was penal in nature and not for rendering any service. Applicability of Section 200A(1)(c): The assessee argued that the Assessing Officer had no power under section 200A to levy late fees under section 234E prior to the amendment of the law on 01.06.2015. The enabling clause (c) was inserted in section 200A w.e.f. 01.06.2015. The Tribunal noted that the late filing fee under section 234E had not been rightly charged in the intimation issued under section 200A/206CB while processing the TDS returns/statements. Earlier, there was no enabling provision in section 200A for raising demands regarding the levy of fees under section 234E. The Tribunal accepted the assessee's contention that no late fee could be levied for the TDS statement filed before 29.06.2014. Retrospective Invocation of Section 200A(1)(c): The Tribunal considered the retrospective invocation of section 200A(1)(c) and referred to a similar issue adjudicated by a Co-ordinated bench in another case. The Tribunal observed that the demand under section 200A for the computation and intimation for the payment of fee under section 234E could not be made before 01.06.2015. Relying on precedents, the Tribunal accepted the grievance of the assessee as genuine and cancelled the fee levied under section 234E of the Act. Procedural Aspects and Precedents: The Tribunal highlighted that the enabling clause (c) in section 200A was inserted w.e.f. 01.06.2015 and that earlier there was no provision for raising demands related to late fees under section 234E. Referring to previous decisions, the Tribunal accepted the assessee's contentions and reversed the order of the CIT(A), cancelling the fee levied under section 234E. The Tribunal emphasized following the principles of statutory interpretation and the need to consider settled law when there is a cleavage of opinion between different High Courts on an issue. Conclusion: In conclusion, the Tribunal allowed the appeal of the assessee, annulling the order of the CIT(A) and cancelling the late fee levied under section 234E of the Act. The decision was based on the retrospective effect of section 200A(1)(c) and the absence of enabling provisions for charging late fees before 01.06.2015. The Tribunal's decision was in line with previous judgments and principles of statutory interpretation.
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