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2019 (11) TMI 751 - AT - Income TaxLevying the late fees u/s 234E - processing the statement of tax deducted at source u/s 200A before the amendment was brought in w.e.f. 01.06.2015 in the provisions of section 200A - HELD THAT - We, therefore, in the given facts and circumstances of the case as well as following the decisions rendered by the Tribunal in the case of State Bank of India, Genda Chowk and others 2018 (11) TMI 1714 - ITAT INDORE , M/s. Madhya Pradesh Power Transmission Ltd. and others Vs. DCIT (TDS) 2018 (12) TMI 1323 - ITAT INDORE are of the view that Ld. CIT(A) erred in confirming the levy of late fees u/s 234E by the assessing officer. Accordingly findings of Ld. CIT(A) in all these 5 appeals are set aside and revenue is directed to delete the levy of fees u/s 234E - Decided in favour of the assessee.
Issues Involved:
1. Whether the Revenue authorities were justified in levying late fees under section 234E of the Income Tax Act while processing the statement of tax deducted at source under section 200A before the amendment effective from 01.06.2015. Detailed Analysis: Issue: Levy of Late Fees under Section 234E The core issue adjudicated in these appeals is the legitimacy of levying late fees under section 234E of the Income Tax Act while processing TDS statements under section 200A before the amendment effective from 01.06.2015. 1. Background and Facts: - The appellants failed to file the TDS statements within the prescribed due dates, leading to the imposition of late fees under section 234E. - The Revenue authorities processed these TDS statements under section 200A and levied late fees. - The appellants contested this levy before the CIT(A), arguing that prior to the amendment effective from 01.06.2015, there was no authority to levy late fees under section 234E while processing statements under section 200A. 2. Appellants' Arguments: - The appellants relied on several decisions from Coordinate Benches, which held that the amendment to section 200A effective from 01.06.2015 is prospective. - They cited cases such as Mentor India Limited vs. DCIT, Sudershan Goyal vs. DCIT (TDS), and others, where it was held that no computation for fees under section 234E could be made for TDS statements processed under section 200A before 01.06.2015. - The appellants also referenced the judgments of the Karnataka High Court in Fatehraj Singhvi vs. UOI, which favored the assessee, and the Gujarat High Court in Rajesh Kaurani vs. UOI, which held against the assessee. - They argued that, following the Supreme Court's judgment in CIT vs. Vatika Township Pvt. Ltd., when there is a split opinion among courts, the view favoring the assessee should be adopted. 3. Revenue's Counterarguments: - The Departmental Representative failed to provide substantial arguments to counter the appellants' submissions. 4. Tribunal's Observations and Decision: - The Tribunal reviewed the rival contentions and the records, noting that the issue had been consistently adjudicated in favor of the assessees by various Coordinate Benches. - The Tribunal reiterated that the amendment to section 200A effective from 01.06.2015 is prospective, and thus, late fees under section 234E cannot be levied on TDS statements processed under section 200A up to 31.05.2015. - The Tribunal referred to its own decisions in State Bank of India, Genda Chowk and others, and M/s. Madhya Pradesh Power Transmission Ltd. and others, which had similar facts and were decided in favor of the assessees. - The Tribunal cited the Agra Bench's decision in Sudarshan Goyal, which emphasized that before 01.06.2015, there was no enabling provision in section 200A for raising a demand for late fees under section 234E. - The Tribunal also referenced the Jaipur Bench's decision in M/s. Mentor India Ltd., which supported the prospective application of the amendment. - Following the principle laid down by the Supreme Court in CIT vs. Vegetable Products Ltd., the Tribunal adopted the view favoring the assessee in case of conflicting opinions between different High Courts. 5. Conclusion: - The Tribunal concluded that the CIT(A) erred in confirming the levy of late fees under section 234E for TDS statements processed under section 200A before 01.06.2015. - The Tribunal set aside the CIT(A)'s findings and directed the deletion of the late fees levied under section 234E in all the appeals. - Consequently, all five appeals were allowed in favor of the assessees. Final Judgment: The Tribunal allowed all five appeals, ruling that the late fees under section 234E could not be levied for TDS statements processed under section 200A before the amendment effective from 01.06.2015. The Tribunal directed the Revenue to delete the levied fees, thereby deciding the issue in favor of the assessees.
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