2023 (6) TMI 605 - AT - Income Tax

Levying late filing fees u/s 234E - Delay in deposit of TDS and Form 27Q on purchase of immovable property - procedural error in filing prescribed TDS form on account of old age and human error - intimation processed u/s 200A - HELD THAT - Assessee being senior citizen has deposited TDS amount immediately after sale consideration was received and there was no lapse on the part of the assessee while depositing the TDS amount to the Treasury of Government of India. Due to the circumstances, the assessee could not file form 27Q within the time frame, but the assessee s intention is clear as the assessee filed the same in January 2021. Thus, merely on the ground that the assessee has not filed Form 27Q on 31.07.2019 and thus late filing cannot be the criteria for levying fees under Section 234E of the Act. Under the current circumstances, in the present case, it will be appropriate to delete the said levy of fee. Appeal of the assessee is thus allowed.

Summary

Issues:
The appeal involves the late filing fees levied on the Assessee for not filing the prescribed TDS form on time due to procedural error, specifically relating to the old age and human error of the Assessee.

Comprehensive Details:

Late Filing Fees Issue:
The Assessee, a resident senior citizen aged 85 years, purchased a house property jointly co-owned by non-residents. The Assessee deducted TDS on the sale consideration as per Section 195 of the Income Tax Act, 1961. The non-resident sellers obtained a lower tax certificate specifying TDS rate at 2.38%. The Assessee deposited the TDS amount of Rs. 7,11,218 to the Central Government on the same day of sale consideration without delay. However, due to old age and human error, the Assessee forgot to file the TDS return in Form 27Q by the due date. Upon realizing the omission in January 2021, the Assessee filed the return. The Assessing Officer levied late filing fees of Rs. 1,05,400 under Section 234E of the Act, which was confirmed by the CIT(A).

Appellate Tribunal Decision:
The Assessee appealed against the intimation processed under Section 200A of the Act. The Assessee argued that the procedural error in filing the TDS return was solely due to human error and old age, with no intention to evade tax compliance. The Assessee had promptly deposited the TDS amount to the Central Government on the day of deduction. The Tribunal noted that there was no delay in depositing the TDS amount and that the Assessee's intention to comply was evident by filing the return in January 2021. Considering the circumstances, the Tribunal found that the late filing should not be the basis for levying fees under Section 234E. Therefore, the Tribunal allowed the appeal, ruling in favor of the Assessee.

Conclusion:
The Tribunal, recognizing the Assessee's prompt TDS payment and genuine effort to rectify the filing error, held that the late filing fees under Section 234E were not justified in this case. Consequently, the Tribunal allowed the appeal filed by the Assessee, overturning the decision of the CIT(A) and relieving the Assessee from the imposed late filing fees.

This summary provides a detailed overview of the issues involved in the legal judgment, focusing on the late filing fees levied on the Assessee and the subsequent decision of the Appellate Tribunal in favor of the Assessee.