2023 (5) TMI 65 - AT - Income Tax

Levy of late fee u/s 234E - late filling of TDS return - divergent views of different High Courts - HELD THAT - When two different views of Court are available on an issue, then the view which favors the Assessee or the judgment which favours the Assessee should be followed. Admittedly there is no contrary judgment of the jurisdictional High Court against the Assessee on the issue under consideration hence, by following the judgment of Fatheraj Singhvi Ors. vs. Union of India 2016 (9) TMI 964 - KARNATAKA HIGH COURT , we are of the considered view that late fee can not be levied u/s 234E of the Act for late filling of TDS Return which pertains to the period prior to 01-06-2015 and consequently inclined to delete the late fees of Rs. 32800/- levied by the AO and affirmed by the ld. CIT(A). Appeal filed by the Assessee stands allowed.

Summary

Issues Involved:
The judgment involves the issue of levy of late fee for delayed filing of TDS return for the financial year 2012-13 (AY: 2013-14) u/s 234E of the Income Tax Act 1961.

Comprehensive details of the judgment for each issue involved:

1. The Assessee challenged the levy of late filing fee before the Ld. Commissioner, who considered relevant provisions of section 200 and 234E of the Act, an amendment dated 1st June 2015, and judgments by High Courts, ultimately affirming the levy of late fee u/s 234E of the Act.

2. In the appeal before the Appellate Tribunal, the Assessee relied on various High Court and Tribunal judgments, while the ld. DR supported the impugned order, citing judgments by the Hon'ble Gujarat High Court and the Tribunal at Jabalpur.

3. The Tribunal observed that the issue related to the levy of late fee for delay in filing TDS statement prior to the amendment brought by the Finance Act, 2015, effective from 1st June 2015.

4. The Tribunal considered various judgments, including those by the Hon'ble Gujarat High Court and Karnataka High Court, and noted that if there are divergent views of different High Courts on an issue, the view favoring the Assessee should be adopted.

5. Since there was no contrary judgment of the jurisdictional High Court against the Assessee on the issue, the Tribunal followed the judgment of the Hon'ble Karnataka High Court and held that late fee cannot be levied u/s 234E for late filing of TDS returns before 01-06-2015, leading to the deletion of the late fees levied by the AO and affirmed by the Ld. CIT(A).

6. Consequently, the appeal filed by the Assessee was allowed by the Tribunal.

This judgment highlights the importance of considering relevant legal provisions, amendments, and judicial precedents in determining the levy of late fees under the Income Tax Act, ultimately emphasizing the principle of favoring the Assessee in case of divergent views among different High Courts.