2024 (5) TMI 95 - AT - Income Tax

Levy of late fees u/s 234E - TDS Statement filed under form 24Q for Quarter 3 and Quarter beyond due date - enabling clause (c) was inserted in the section 200A w.e.f. 01.06.2015 - HELD THAT - We understand that earlier, there was no enabling provision in the Act u/s 200A for raising demand in respect of levy of fee u/s 234E. As such, in respect of TDS statement filed for a period prior to 31.03.2015, no late fee could be levied in the intimation issued u/s 200A of the Act. See Sudershan Goyal 2018 (5) TMI 1626 - ITAT AGRA as relying on SRI. FATHERAJ SINGHVI AND OTHERS 2016 (9) TMI 964 - KARNATAKA HIGH COURT held demand u/s 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. Thus we accept the legal position that late fees u/s 234E cannot be imposed on late filing of TDS returns u/s 200A, for both the Asst years, under appeal, and the same is deleted. Decided in favour of assessee.

Summary

Issues Involved:
The judgment involves the levy of late fees under section 234E of the Income Tax Act, 1961, for two different assessment years, and the rejection of rectification applications under section 154.

Issue 1: Levy of Late Fees for Assessment Year 2013-14
The appellant, a Government Defence Department, filed quarterly TDS statements belatedly for F.Y. 2012-13, resulting in the imposition of late fees under section 234E. The Assessing Officer imposed late fees totaling Rs. 1,49,510, which was challenged through a rectification application under section 154. The appellant argued that prior to June 1, 2015, there was no provision allowing the levy of late fees under section 234E. The judgment cites precedents and legal provisions to support the appellant's contention that the late fees imposed were not legally sustainable.

Issue 2: Levy of Late Fees for Assessment Year 2014-15
The facts and grounds of appeal for Assessment Year 2014-15 mirror those of Assessment Year 2013-14, with the disputed late fees amounting to Rs. 68,320. Given the decision in favor of the appellant for the preceding year, the imposition of late fees for this assessment year was also deemed unjustified and subsequently canceled.

Conclusion:
The Appellate Tribunal, ITAT Amritsar, allowed both appeals of the assessee, ITA Nos. 334/Asr/2023 & 335/Asr/2023, concerning the levy of late fees under section 234E for the respective assessment years. The tribunal held that the late fees imposed on the delayed filing of TDS returns under section 200A could not be sustained, following legal precedents and the absence of enabling provisions prior to June 1, 2015. Consequently, the imposition of late fees was canceled for both assessment years, in line with the legal position established by the tribunal and other coordinating benches.