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TMI Blog2019 (7) TMI 1213X X X X Extracts X X X X X X X X Extracts X X X X ..... est. The Tribunal also held that in appeal against an order u/s.200A, the provision of law applicable, in so far as the powers of CIT(A) in an appeal u/s.200A, was clause (c) of section 251 and that clause empowers the CIT(A) to pass such orders in the appeal as he thinks fit. The Tribunal held that a reading of the aforesaid clause would show that the CIT(Appeals) in the cases to which the said clause applies, can pass such orders as he thinks fit, but that power is circumscribed by the words in the appeal . Therefore, the CIT(Appeals) cannot travel beyond the subject matter of the appeal, which was as to whether fee u/s. 234E can be levied or not; and not the question, whether the return of TDS filed by the assessee is non est in law? Since the facts and circumstances of the case in these appeals are identical to the case referred to above, following the decision in those appeals, we allow the appeals of the Assessee by holding that the conclusion of the CIT(Appeals) holding that return of TDS filed by the assessee is non est in law is not valid in the eyes of law and the said direction is directed to be deleted and the order of the CIT(Appeals), to this extent, is held t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ection (3) of section 206C. (4) The provisions of this section shall apply to a statement referred to in sub-section (3) of section 200 or the proviso to sub-section (3) of section 206C which is to be delivered or caused to be delivered for tax deducted at source or tax collected at source, as the case may be, on or after the 1st day of July, 2012. 3. Aggrieved by the aforesaid orders, the assessee filed appeals before the CITA. The assessee s contention before CIT(A) was that the provisions of section 234E of the Act was inserted by the Finance Act, 2012 w.e.f. 1.7.2012. Section 200A of the Act is a provision which deals with how a return of TDS filed u/s.200(3) of the Act has to be processed and it reads as follows:- Processing of statements of tax deducted at source . 200A. (1) Where a statement of tax deduction at source or a correction statement has been made by a person deducting any sum (hereafter referred to in this section as deductor) under section 200, such statement shall be processed in the following manner, namely:- ( a ) the sums deductible under this Chapter shal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ), (d) (f) of the Act and those provisions came into force only from 1.6.2015 and therefore the authority issuing intimation u/s. 200A of the Act while processing return of TDS filed u/s.200(3) of the Act, could not levy fee u/s. 234E of the Act in respect of statement of TDS filed prior to 1.6.2015. The assessee, thus, challenged the validity of charging of fee u/s. 234E of the Act. The assessee relied on the decision of the Hon ble High Court of Karnataka in the case of Fatehraj Singhvi v. UOI [2016] 73 taxmann.com 252 wherein the Hon ble Karnataka High Court held that amendment made u/s. 200A providing that fee u/s. 234E of the Act could be computed at the time of processing of return and issue of intimation has come into effect only from 1.6.2015 and had only prospective effect and therefore, no computation of fee u/s.234E of the Act for delayed filing of return of TDS while processing a return of TDS u/s.234E of the Act could have been made for tax deducted at source for the assessment years prior to 1.6.2015. 5. The CIT(Appeals) accepted the claim of the assessee and he held that in view of the judgment of the Hon ble High Court of Karnataka cited by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was passed by the CIT(A) which orders are challenged in these appeals. In the aforesaid decision, the Tribunal held that the TDS return filed beyond time cannot be declared as non est in law and that the CIT(A) does not have powers of enhancement in an appeal against an order u/s.200A of the Act. The learned DR relied on the order of CIT(Appeals) and further placed reliance on the decision of the Hon ble Gujarat High Court in the case of Rajesh Kourani v. UOI [2017] 83 taxmann.com 137 (Guj) wherein the Hon ble High Court took a view that levy of fee u/s. 234E of the Act is possible even without a regulatory provision u/s. 200A of the Act and therefore the levy of fee u/s. 234E of the Act w.e.f.1.7.2012, when those provisions were introduced, was valid. We are of the view that this Tribunal is bound to follow the decision of the Hon ble High Court of Karnataka which is the jurisdictional High Court and therefore this argument advanced by the ld. DR cannot be accepted. Even otherwise, the issue before the Tribunal is with regard to action of the CIT(A) in treating the return of TDS filed by the assessee as non est and therefore the decision of the Hon ble Gujara ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... duct tax at source. Declaring a return of TDS as non est, cannot have the effect of treating the payee as an Assessee in default and expose him to other consequences under the Act as an Assessee in default. Section 234E(3) lays down that the fee to be paid u/s. 234E of the Act shall be paid before the return of TDS is filed u/s. 200(3) of the Act. This provision, in our view, does not confer power on the CITA to declare the return of TDS as non est in law in a case where the return of TDS is filed without payment of fee u/s.234E of the Act. Besides the above, in the present case, the levy of fee u/s. 234E of the Act has already been deleted by the CITA and therefore these provisions cannot be of any help to the conclusions of the CIT(Appeals) that the return filed without payment of fee u/s. 234E of the Act is invalid and can be declared as non est in law. 14. As far as the power of enhancement under Explanation to section 251(1) which was relied on by the ld. DR is concerned, the Explanation is only with regard to clauses (a), (aa) and (b) of section 251(1) of the Act and is not applicable to clause (c). The provisions of Sec.251 of the Act reads thus: ..... X X X X Extracts X X X X X X X X Extracts X X X X
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