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TMI Blog2020 (4) TMI 257X X X X Extracts X X X X X X X X Extracts X X X X ..... d 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 of the Act can be levied or not; and not the question, whether the return of TDS filed by the assessee is non est in law. 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 to be bad in law. - Decided in favour of assessee. - ITA Nos. 2685 to 2691/Bang/2018 - - - Dated:- 22-1-2020 - Shri N.V. Vasudevan, Vice President And Shri B R Baskaran, Accountant Member For the Appellant : Smt. Suman Lunkar, CA For the Respondent : Smt. K. Haritha, Addl. CIT ORDER PER BENCH These are a batch of 7 appeals filed by Assessee against a common order dated 26.7.2018 by CIT(Appeals), Bangalore-9, relating to different quarters of assessment years 2013-14 to 2015-16. 2. The assessee filed st ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt 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 shall be computed after making the following adjustments, namely:- ( i ) any arithmetical error in the statement; or ( ii ) an incorrect claim, apparent from any information in the statement; ( b ) the interest, if any, shall be computed on the basis of the sums deductible as computed in the statement; ( c ) the fee, if any, shall be computed in accordance with the provisions of section 234E; ( d ) the sum payable by, or the amount of refund due to, the deductor shall be determined after adjustment of the amount computed under clause ( b ) and clause ( c ) against any amount paid under section 200 or section 201 or section 234E and any amount paid otherwise by way of tax or interest or fee; ( e ) an intimation shall be prepared or generated and sent to the deductor specifying the sum determined to be payable by, or the amount of refund due to, him under clause ( d ); and ( f ) the amount of refund due to the deductor in pursuance o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Karnataka cited by the ld. Counsel for the assessee, fee u/s. 234E cannot be charged and cancelled the intimation u/s. 200A of the Act in so far as it relates to levy of fee u/s.234E of the Act. 6. The CIT(Appeals), however, in purported exercise of his powers of enhancement, proposed to hold that the statement of TDS filed by the assessee was non est in law because it was filed beyond the time prescribed u/s. 200(3) of the Act. To this proposal of enhancement by the CITA, the assessee filed a reply in which he took a stand that TDS statement filed without payment of fee is a valid statement. The CIT(A), however, referred to the provisions of section 234E of the Act which lays down the amount of fee referred to sub-section (1) of section 234E shall be paid before delivering or causing to be delivered a statement in accordance with the provisions of sub-section (3) of section 200. The CIT(A) also took a stand that TDS statement filed without payment of fee u/s. 234E of the Act is not a valid statement. 7. Another argument of assessee before the CITA was that if a return of income is invalid or defective, the AO u/s. 139(9) of the Act has to call upon the assessee to rect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed 22.3.2019 dealt with an identical issue wherein the CIT(A) has passed identical order as 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d to deduct 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 ITA No. 625 to 628/Bang/2019 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 Ac ..... 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