2023 (8) TMI 821 - AT - Income Tax

Rectification u/s 154 - Period of limitation - Late fee u/s. 234E - delay in filing quarterly E-TDS return - HELD THAT - We find that the observation of the CIT(Appeals), NFAC that as per the provisions of Section 154 rectification of a mistake can be made only upto four years from the end of the financial year in which the order sought to be rectified was passed, has not been assailed by the assessee before us. We find that as observed by the CIT(Appeals), NFAC and, rightly so, as per sub-section (7) of Section 154 of the Act, as no amendment under the said section shall be made after expiry of four years from the end of the financial year in which the order sought to be rectified was passed, therefore, the applications filed by the assessee seeking rectification of the orders passed by the DCIT, CPC-TDS u/s. 200A of the Act on 06.09.2014 by filing rectification letters dated 02.02.2022 for the aforementioned respective years were in itself not maintainable. No infirmity in the view taken by the CIT(Appeals), NFAC that as the applications filed by the assessee after expiry of more than seven years from the end of the financial year in which the order was sought to be rectified u/s. 154 of the Act were in itself barred by limitation, therefore, the same were not maintainable.

Summary

Issues Involved:
1. Levy of Late Fees under Section 234E of the Income Tax Act
2. Maintainability of Rectification Applications under Section 154 of the Income Tax Act

Summary:
1. Levy of Late Fees under Section 234E of the Income Tax Act:
The Deputy Commissioner of Income Tax (DCIT), Centralized Processing Cell (CPC), TDS, Ghaziabad imposed late fees under Section 234E of the Income Tax Act for delays in filing quarterly TDS returns for the financial years 2013-14 and 2014-15. The assessee did not initially file appeals against these orders but instead submitted "correction statements" on 02.02.2022, which were rejected by the DCIT as no "mistake apparent from record" was found.

2. Maintainability of Rectification Applications under Section 154 of the Income Tax Act:
The assessee's rectification applications were filed after more than seven years from the end of the financial year in which the original orders were passed, exceeding the four-year limitation period specified under Section 154 of the Act. The CIT(Appeals), NFAC, dismissed the appeals on two grounds:
1. The rectification applications were time-barred.
2. The issues raised required fresh investigation of facts and did not constitute a "mistake apparent from record."

The appellate tribunal upheld the CIT(Appeals)' decision, emphasizing that rectification under Section 154 is only permissible within four years from the end of the financial year in which the order was passed. The tribunal found no infirmity in the CIT(Appeals)' view that the applications were not maintainable due to being barred by limitation.

Conclusion:
The tribunal dismissed the appeals filed by the assessee, agreeing with the CIT(Appeals) that the rectification applications were not maintainable as they were filed beyond the statutory limitation period and did not involve a "mistake apparent from record." The order was pronounced in open court on 14th August 2023.