TMI Blog2023 (4) TMI 20X X X X Extracts X X X X X X X X Extracts X X X X ..... dingly, uphold the levy. - I.T.A. Nos. 55/JAB/2022, 56/JAB/2022, 57/JAB/2022, 58/JAB/2022, 59/JAB/2022, 60/JAB/2022, 61/JAB/2022, 62/JAB/2022 . 63/JAB/2022, 64/JAB/2022, 65/JAB/2022, 66/JAB/2022, 67/JAB/2022, 68/JAB/2022, 69/JAB/2022,, 70/JAB/2022, 71/JAB/2022 And Ors. - - - Dated:- 31-10-2022 - I.T.A. No's 72/JAB/2022, 73/JAB/2022, 74/JAB/2022, 75/JAB/2022, 76/JAB/2022, 77/JAB/2022 SHRI SANJAY ARORA, HON BLE ACCOUNTANT MEMBER SHRI MANOMOHAN DAS, HON'BLE JUDICIAL MEMBER For the Appellant : Shri Hardik Chordia Shri Pratik Sadrani, FCAs For the Respondent : Shri Ravi Mehrotra, Sr.DR ORDER Per Bench: This is a set of 23 Appeals by different branches of the assessee-bank contesting the confirmation of levy of late filing fee under section 234E of the Income Tax Act, 1961 ( the Act‟ hereinafter), aggregating to Rs. 2,69,921, by the National Faceless Appeal Centre, Delhi ( CIT(A)‟ for short) on processing of statements filed by the assessee u/s. 200A of the Act for financial year (f.y.) 2012- 13 (Qtr-III onwards) to f.y. 2014-15 (Qtr-I). 2. The controversy arising in the instant appeals, as projected before us by Shri Ch ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... would per se warrant a decision in favour of the assessee, i.e., in absence of a decision by the Hon'ble jurisdictional High Court, in view of the decision by the Apex Court in CIT v. Vatika Township Pvt. Ltd. [2014] 367 ITR 466 (SC). 3. We have heard the parties, and perused the material on record. 3.1 We may begin by reproducing the relevant provisions of the Act, also noting their date of commencement: Duty of person deducting tax. 200. (1) . (2A) (3) Any person deducting any sum on or after the 1st day of April, 2005 in accordance with the foregoing provisions of this Chapter or, as the case may be, any person being an employer referred to in sub-section (1A) of section 192 shall, after paying the tax deducted to the credit of the Central Government within the prescribed time, prepare such statements for such period as may be prescribed and deliver or cause to be delivered to the prescribed income-tax authority or the person authorised by such authority such statement in such form and verified in such manner and setting forth such particulars and within such time as may be prescribed: Provided that the person may also deliver to the prescribed authority ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Clause (c) stands amended by Finance Act, 2015, w.e.f. 1-6-2015, as under, with consequential amendments in erstwhile clauses (c) to (e): (c) the fee, if any, shall be computed in accordance with the provisions of section 234E;‟ Fee for default in furnishing statements. 234E. (1) Without prejudice to the provisions of the Act, where a person fails to deliver or cause to be delivered a statement within the time prescribed in sub-section (3) of section 200 or the proviso to sub-section (3) of section 206C, he shall be liable to pay, by way of fee, a sum of two hundred rupees for every day during which the failure continues. (2) The amount of fee referred to in sub-section (1) shall not exceed the amount of tax deductible or collectible, as the case may be. (3) The amount of fee referred to in sub-section (1) shall be paid before delivering or causing to be delivered a statement in accordance with sub-section (3) of section 200 or the proviso to sub-section (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 whic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ked out at the stipulated rate of Rs. 200 per day w.e.f. 01/06/2015, i.e., the date on which clause (c) came to be inserted in s.200A(1). We have toward this gleaned through the Intimations in all these appeals. The maximum amount of late fee is Rs. 46,700/- (for Qtr-IV of f.y. 2013-14), which works to a delay of 232 days, even as delay reckoned from 01/06/2015 (to the date of filing, i.e., 27/04/2020) is much higher (1790 days). The reason in all the cases for levy in a sum lower that that leviable with reference to the period of delay, even if reckoned w.e.f. 01/06/2015, not to speak with reference to period of actual delay (as, for instance, w.e.f. 15/10/2014 for ITA No. 55/JAB/2022), is the capping of the same to the amount of tax deductible (or collectible) at source (s. 234E(3)). In sum, the levy u/s. 234E in all these appeals is: a) qua statement/s filed u/s. 200(3) on or after 01/06/2015; b) in the sum which is referable to the delay computed w.r.t. this date. That is, there is, in effect, no levy for any period prior to 01/06/2015. It is this that led us to remark at the beginning of our discussion, as indeed during hearing itself, as to what, then, is the c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ight person (defined by PAN) allowed. The rationale of the levy, as explained by the Hon'ble Court upholding section 234E, is to compensate the Revenue for the cost entailed in addressing the issues arising out of the delayed filing of the statements inasmuch as the rightful deductees would not stand to be allowed credit for TDS/TCS, even if deposited to the credit of the Central Government in time, i.e., where there is a delay in filing the particulars, or filing incorrect particulars or mismatch therein. Reference, in this context, justifying the levy in view of the costs involved, be made to Rajesh Kourani (supra). The furnishing of particulars must be construed as correct particulars as, absence thereof would not result it being properly processed, serving its purpose. Why, it may well be that the original statement, though incorrect, is filed in time. Its processing u/s. 200A shall not result in any levy u/s. 234E, which may arise for the first time only on the assessee filing the correct statement later. The difference is though technical, arising on account of the revision of the statement by the assessee, correcting it, being not u/s. 154, but only u/s. 200. 4.1 We m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... w.r.t. each day of delay, reckoned with reference to the date on which the same was to be filed in terms of ss.200(3)/ 206C(3) where the same falls on or after 01/7/2012. The same, however, is not, dependent on the actual delivery of the statement. This is clear from the language of the s.234E(1) itself. Why, not so interpreting would be without rationale as an absolute default would remain outside the ambit of the provision, defeating the charge and, thus, the provision itself. Further, as the levy cannot, in any case, exceed the amount short deducted/deposited, one could avoid the levy merely by not filing the statement, with no attendant risk inasmuch as, as afore-noted, the delay beyond a particular period becomes inconsequential in view of the capping of the fee to the amount of TDS/TCS. Non-filing of the statement would imply its non-processing, which is u/s. 200A, effectively by-passing the levy u/s. 234E. Would that therefore mean that no fee is liable to be charged in such a case, either w.e.f. 01/7/2012, or even 01/6/2015? That would be, quite plainly, ludicrous. The charge has to be, to make it effective, thus, necessarily be read as liable to be enforced, irrespective o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ngfully and purposefully and, further, conjunctively, holistically, and in harmony with other provisions. 4.3 Put succinctly, the charge u/s. 234E is independent of the actual delivery of the statement u/s. 200(3), which is attracted once the statement to be delivered thereunder is not so done within the time prescribed therefor. Clauses (a) (b) of s. 200A provide for making adjustments in the respect of tax deductible and interest thereon with reference to the information in the statement u/s. 200(3), providing for furnishing the details of the sum deducted and paid to the credit of the Central Government. The absence of a specific clause u/s. 200A for the fee u/s. 234E, as we understand, is, as the law, as envisaged, did not contemplate a difference; the parameters being clearly defined, in the sum payable u/s. 234E(1) and that paid thereunder. It is only on account of the fee payable with reference to the correction statements, obliged to be filed u/s. 200(3) w.e.f. 01/10/2014, that it perhaps became incumbent to clarify the same beyond doubt, as since done by introducing the processing thereof in s. 200A(1). We say so, even as it could be argued that a statement filed with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssee, we find decisions by these two High Courts as well taking a view similar to that by the majority of the High Courts. That is, there is, on the contrary, almost a unanimity of judicial view in favour of the applicability of the charge u/s. 234E(1) for the periods on or after 01/07/2012. Rather, as held by the Apex Court several times, as in Virtual Soft Systems Ltd. v. CIT [2007] 289 ITR 83 (SC), that it would be inclined under the circumstance of a predominant view by the High Courts to adopt a view consistent therewith. On the contrary, there may be circumstances where the decision by the non-jurisdictional High Court, even if it is the sole decision on the point, may not be followed, as explained in Rishi Roop Chemical Co. (P.) Ltd. vs. ITO [1991] 36 ITD 35 (Del)(SB). Reference in this context be also made to the decision in CIT v. Mirza Ataullaha Baig Anr. [1993] 202 ITR 291 (Bom), subjecting the doctrine of beneficial interpretation to the existence of an ambiguity in law, which in fact, as explained time and again by the Apex Court, is the premise of this doctrine. We have already explained with reference to the binding decisions by the Apex Court that the machinery pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 00A would be in nature of (a) clarificatory amendment. Even in absence of such provision, as noted, it was always open for the Revenue to charge the fee in terms of section 234E of the Act. By amendment, this adjustment was brought within the fold of section 200A of the Act. This would have one direct effect. An order passed under section 200A of the Act is rectifiable under section 154 of the Act and is also appealable under section 246A. In absence of the power of authority to make such adjustment under section 200A of the Act, any calculation of the fee would not partake the character of the intimation under said provision and it could be argued that such an order would not be open to any rectification or appeal. Upon introduction of the recasted clause (c), this situation also would be obviated. Even prior to 01.06.2015, it was always open for the Revenue to calculate fee in terms of section 234E of the Act. The Karnataka High Court in case of Fatheraj Singhvi (supra) held that section 200A was not merely a regulatory provision, but was conferring substantive power on the authority. The Court was also of the opinion that section 234E of the Act was in the nature of privilege to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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