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2016 (10) TMI 104 - ITAT PUNE

2016 (10) TMI 104 - ITAT PUNE - TMI - Levy of fees under section 234E in intimation issued under section 200A(1) - Late filing of TDS return - whether any appeal is maintainable against the intimation issued under section 200A of the Act and / or order passed under section 154 r.w.s. 200A of the Act by Assessing Officer in charging the fees under section 234E of the Act? - Held that:- Held that:- The Legislature recognizes that a deductor who has filed his statement of tax deducted at source, wh .....

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ppealable order under section 246A(1)(a) of the Act, therefore, the CIT(A) should have examined the legality of adjustment made under intimation issued under section 200A of the Act. The CIT(A) has rejected the present set of appeals on the surmise that first of all, no appeal is provided against the intimation issued under section 200A of the Act. Further, the CIT(A) has also decided the issue on merits and the assessee is in appeal before us on both these grounds. Vis--vis the first issue of .....

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sued under section 200A(1) of the Act is appealable order before the CIT(A) under section 246A(1)(a) of the Act, then such appealable order passed by the CIT(A) under section 250 of the Act is further appealable before the Tribunal under section 253 of the Act. Hence, we admit the present appeals filed by the assessee even on this preliminary issue. We have already adjudicated the issue of charging fees under section 234E of the Act by the Assessing Officer while processing returns / statements .....

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da, Accountant Member C.H. Naniwadekar, R.R. Pethe, Sanket Joshi, Abhay Avchat and R.P. Daware for the Appellant S.K. Rastogi for the Respondent 1018/PN/2016 to 1023/PN/2016 29/PN/2016 to 31/PN/2016 1420/PN/2015 to 1422/PN/2015 1387/PN/2015 & 1388/PN/2015 1698/PN/2015 to 1700/PN/2015 438/PN/2016 to 441/PN/2016 1443/PN/2015 & 1444/PN/2015 12/PN/2016 Aher Engg & 1231/PN/2015, 1460/PN/2015 to 1462/PN/2015 228/PN/2016 230/PN/2016 226/PN/2016 1517/PN/2015 1520/PN/2015 1672/PN/2015 48/PN/2 .....

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5 89/PN/2016 1594/PN/2015 1257/PN/2015 & 1258/PN/2015 195/PN/2016 194/PN/2016, 1744/PN/2016 & 1745/PN/2016 231/PN/2016 360/PN/2016 481/PN/2016 to 484/PN/2016 102196/PN/2016, 1741/PN/2016 1743/PN/2016 225/PN/2016 227/PN/2016 229/PN/2016 ORDER Sushma Chowla, Judicial Member - This bunch of appeals filed by different assessee are against respective orders of CIT(A) relating to different assessment years against respective intimation issued under section 200A(3) of the Income-tax Act, 1961 ( .....

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rate appeals for each of the quarters. The assessee thereafter, has filed separate appeals for each of the quarters and has also moved an application for condonation of delay with a request that the earlier appeal which was filed for all the quarters together may be treated as infructuous. In the totality of the above facts and circumstances, where the original appeal filed by the assessee was in time and then, merely because each of the appeal for the respective quarters was not filed separatel .....

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ITA Nos. 1018/PN/2016 to 1023/PN/2016 filed after delay of 45 days, appeals in ITA Nos.29/PN/2016 to 31/PN/2016 filed after delay of 4 days, appeal in ITA No.12/PN/2016 filed after delay of 63 days, appeals in ITA Nos.1702/PN/2015 & 1703/PN/2015 filed after 57 days, appeals in ITA Nos.08/PN/2016 to 11/PN/2016 filed after delay of 63 days and appeals in ITA Nos.481/PN/2016 to 484/PN/2016 filed after delay of 22 days, against which the respective assessee have filed applications for condonati .....

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dly and proceed to decide the same after taking the same on record. 4. The issue arising in all the appeals before us is against intimation issued under section 200A of the Act and / or order passed under section 154 of the Act in charging fees payable under section 234E of the Act. The assessee has raised two facets of the issue; one against the order of CIT(A) in holding that such orders passed are not appealable and not maintainable under section 246A(1) of the Act. The second aspect of the i .....

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iled for the period prior to 01.06.2015, late fees charged under section 234E of the Act could not be levied in the intimation issued under section 200A of the Act. 5. In order to adjudicate the issue raised in these appeals, few material facts have to be considered. The assessee was required to deduct tax at source out of payments made on account of salary, interest, etc. for the respective quarters in the accounting period. The Act required the assessee to file quarterly TDS returns intimating .....

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filed an application under section 154 of the Act also. However, the same were dismissed by the respective Assessing Officers. 6. In appeal, the CIT(A) held that the appeal of assessee was not maintainable, in view of the ratio laid down by the Hon'ble Bombay High Court in Rashmikant Kundalia v. Union of India [2015] 54 Taxman.com 200 (Bom). Further, even on merits, the contention of assessee that the Assessing Officer was not empowered to raise the demand under section 234E of the Act by pa .....

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s of section 200(3) of the Act, wherein the duty of person was to file the statement within prescribed time. Reference was made to Rule 31A of the Income Tax Rul es, 1962 (in short 'Rules'), which provides the time limit to file the statement of tax deducted at source. He further pointed out that the Act requires quarterly statement to be filed within 15 days of close of the quarter. Thereafter, the learned Authorized Representa tive for the assessee pointed out that clause (c) to sectio .....

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had been charged under section 234E of the Act. He further pointed out that in assessee's case i.e. Maharashtra Cricket Association, one set of orders were under section 200A(1) of the Act and the second set of orders were under section 154 of the Act and both these orders were appealable under section 246A(1)(a) and section 246A(1)(c) of the Act. The learned Authorized Representative for the assessee in this respect pointed out that it had originally filed two appeals for separate bunches o .....

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t but was passed under section 200A of the Act and also under section 154 r.w.s. 200A of the Act. The CIT(A) had relied on the ratio laid down by the Hon'ble Bombay High Court in Rashmikant Kundalia v. Union of India (supra), which settled the constitutional validity of section 234E of the Act. The arguments before the Hon'ble Bombay High Court were that there was no right to insert the said section. However, no arguments were advanced in respect of applicability of said section for the .....

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tion 234E of the Act, which was provided w.e.f. 01.06.2015. He further stressed that where the assessee had denied his liability to be assessed, then the right to appeal is provided under section 246A(1)(a) of the Act and where the assessee says that he denies his liability, then the same has to be interpreted liberally. Referring to the decision of Hon'ble Bombay High Court in Rashmikant Kundalia v. Union of India (supra), relied upon by the CIT(A), the learned Authorized Representative for .....

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sing of demand under section 200A of the Act has been adjudicated by series of cases by different Tribunals and copies of same were filed. 9. Further, it was pointed out that the CIT(A) has wrongly applied the ratio laid down by the Hon'ble High Court of Karnataka in Lakshmi Niman, Bangalore Pvt. v. DCIT, Ghaziabad [2005] 60 taxman.com 144 (Kar). He stated that it was not the case of assessee that fees was illegal but since there was no mechanism provided to levy the fees under section 200A .....

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l gains has to be computed in the hands of assessee since there was no mechanism to charge capital gains. He further stressed that the Hon'ble Rajasthan High Court in M/s. Dundlod Shikshan Sansthan & Anr. v. Union of India and Ors. in D.B. Civil Writ Petition No.8672/2014, judgment dated 28.07.2015 had adjudicated the issue relating to whether the fees charged is legal or illegal and had not touched upon the mechanism to levy the fees. In this regard, the learned Authorized Representativ .....

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was inserted later and where section 200A of the Act does not provide for levy of fees by the Assessing Officer till before the amendment w.e.f. 01.06.2015, there was no merit in charging the said levy. He further pointed out that after the amendment w.e.f. 01.06.2015, the Assessing Officer had power to make adjustments in intimation passed under section 200A of the Act itself. 10. Another Counsel Shri Sanket Joshi appearing before us relied on the submissions made by Shri Naniwadekar and furthe .....

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ated to the period prior to 01.06.2015 and hence, no fees could be charged under section 234E of the Act. He further pointed out that in CIT v. Vatika Township Pvt. Ltd. [2014] 367 ITR 466 (SC), the Hon'ble Supreme Court held that any amendment can be considered retrospective in order to remove the hardship of assessee but not of the Department. 11. Shri Abhay Avchat, learned Counsel appearing for some of the assessee referred to the amendment brought in by the Finance Act and further placed .....

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f the Act, which provide deduction of tax at source, wherein payer of sum be it is salary, interest or commission, etc. has certain obligations and they have been made responsible, wherein the payments are made or credited to the account of payee, then the duty of the deductor is to deduct tax. Sections 192 to 194LD, 195 to 196D of the Act were various provisions for deducting tax at source. Section 199 of the Act provides credit of tax deducted at source and section 200 of the Act lays down the .....

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mes. Once the tax was deducted, then it was not the deductor's money but it was deducted on account of third party, who claims it as part of his tax payment. The obligation on the deductor was to collect the said tax deducted at source and deposit the same and the deductee had all the rights to claim the benefit of such tax deducted by the deductor. Earlier, under the Act, the onus was upon the deductor to issue certificate for claiming TDS payments. However, since there were various frauds, .....

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ctification can also be issued. 13. The learned CIT-DR further pointed out that before insertion of levy of fees under section 234E of the Act, there was provision of levy of penalty under section 272A(2)(k) of the Act. This amendment was w.e.f. 01.04.2005, hence where the statement was not filed by the deductor, penal provisions were attracted and the same was with respect to quarterly returns to be filed. The learned CIT-DR further pointed out that the provisions of section 200(3) of the Act a .....

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it was provided that person shall be liable to deposit the tax deducted at source, hence the provisions were mandatory i.e. the liability was on the deductor to furnish the statement and in case of any default in furnishing statement, fees was provided under the said section. He further referred to the second proviso, which was inserted w.e.f. 01.07.2012, wherein it is provided that under clause (k) to section 272A(1) of the Act, no penalty is to be levied. He stressed that after such an amendm .....

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ointed out that the amount of fees is to be deposited before delivering the statement. He stressed that the provisions of section 234E of the Act was charging section wherein the liability was upon the assessee that he shall pay and when the same is to be paid is also specified therein. The Legislature in this regard was clear that defaulter itself would make the compliance. Hence, the question is if as per section 234E(1) of the Act, the assessee is liable to pay late fees and as per sub-sectio .....

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out that the right to appeal was the creation of statute and the Hon'ble High Court was dealing with constitutional validity but also considered the purpose for which the said section was introduced. Referring to section 200A(1)(c) of the Act, he stated that though the word used is fees, if any, but that means where there is an error or where no fees has been paid, then although the amendment was w.e.f. 01.06.2015, but the amendment was procedural in nature. He stressed that once charging se .....

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he Act. He further contended that by way of an amendment in 2015, the Act has not provided any new levy; the provisions of section 234E of the Act were already there and amendment is only clarificatory. Section 234E of the Act was charging section w.e.f. 01.04.2012 and in case of violation of provisions of the Act, fees was to be levied. Referring to the reliance placed upon by the learned Authorized Representative for the assessee on CIT v. Vatika Township Pvt. Ltd. (supra), he pointed out that .....

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hence retrospective in nature. He further placed reliance on the ratio laid down by the Hon'ble Supreme Court in Govinddas v. ITO (1976) 103 ITR 123 (SC). 15. The learned Authorized Representative for the assessee in rejoinder pointed out that Memo explaining the Finance Bill clearly says that the amendment was w.e.f. 01.06.2015 and it was proposed to amend the provisions of section 200A of the Act. He further stated that under the provisions of section 45 of the Act, where the cost of acqui .....

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der section 234E of the Act. In order to adjudicate the issue, first reference is being made to the relevant provisions of the Act. Under Chapter XVII headed 'collection and recovery of taxes' and under 'clause B', deduction at source, the statute lays down the duty of the payer of certain amounts to deduct tax at source under sections 192 to 194LD, 195 to 196D of the Act. Under section 198 of the Act, it is provided that the tax deducted at source shall for the purpose of comput .....

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me such payment of tax has been made. 17. Section 200 of the Act lays down the duty of the person deducting tax, which reads as under:- "200. (1) Any person deducting any sum in accordance with the foregoing provisions of this Chapter shall pay within the prescribed time, the sum so deducted to the credit of the Central Government or as the Board directs. (2) Any person being an employer, referred to in sub-section (1A) of section 192 shall pay, within the prescribed time, the tax to the cr .....

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ting such sum or tax to the credit of the Central Government, shall deliver or cause to be delivered to the prescribed income-tax authority, or to the person authorised by such authority, a statement in such form, verified in such manner, setting forth such particulars and within such time as may be prescribed. (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 re .....

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liver to the prescribed authority a correction statement for rectification of any mistake or to add, delete or update the information furnished in the statement delivered under this sub-section in such form and verified in such manner as may be specified by the authority. " 18. Under section 200(1) of the Act, it is provided that any person deducting any sum in accordance with the provisions of the Chapter shall pay within the prescribed time, the sum so deducted to the credit of the Centra .....

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ing & Disbursing Officer or any other person, to deliver or cause to be delivered to the prescribed income tax authorities, or to the person authorized by such authority, statement in such form, verified in such manner, setting forth such particulars within such time as may be prescribed. Under section 200(3) of the Act, similar responsibility is on any person deducting any sum on or after first day of April, 2005 in accordance with foregoing provisions of the Chapter, including any person a .....

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son deducting any sum in accordance with various provisions under the Chapter and also upon an employer who is making deduction out of the payments made to the employees, then sub-section (3) requires that the deductor is to prepare a statement for such period as may be prescribed, which is to be delivered to the prescribed authority, in such form and verified and setting forth such particulars as may be prescribed. The said statement is to be delivered within such time as may be prescribed. 19. .....

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to in sub-rule (1) are to be delivered quarterly and the stipulated period of due date of filing the said statement in respect of deductor being an office of the Government and the deductor being other than Government, are provided. The sub-rule (3) of Rule 31A of the Rules further provides that the statement referred to in sub-rule (1) may be furnished in any of the following manners i.e. by way of furnishing the statement in paper form or furnishing the statement electronically under digital .....

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00A. (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 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) t .....

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f refund due to, him under clause (c); and (e) the amount of refund due to the deductor in pursuance of the determination under clause (c) shall be granted to the deductor : Provided that no intimation under this sub-section shall be sent after the expiry of one year from the end of the financial year in which the statement is filed. Explanation.-For the purposes of this sub-section, "an incorrect claim apparent from any information in the statement" shall mean a claim, on the basis of .....

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deductor as required under the said sub-section. 20. Section 200A of the Act lays down the manner in which the statements of tax deducted at source are to be processed for issuing the intimation. First of all, the sums deductible under the Chapter are to be computed and interest, if any, shall be computed on the basis of such sums deductible as computed in the statements as per clause (a) and (b) under section 200A(1) of the Act. Clauses (c) to (f) reproduced above were substituted for clauses .....

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y, or the amount of refund due to, him under clause (c); and (e) the amount of refund due to the deductor in pursuance of the determination under clause (c) shall be granted to the deductor." 21. As per newly substituted clause (c) w.e.f. 01.06.2015, the fees, if any, is to be computed in accordance with the provisions of section 234E of the Act. However, under the earlier clause (c), there was no such provision. 22. Section 234E(1) of the Act provides that where a person fails to deliver o .....

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e may be. Sub-section (3) further lays down that the amount of fees referred to in sub-section (1) shall be paid before delivering or causing to be delivered a statement in accordance with sub-section 200(3) of the Act or the proviso to section 206C(3) of the Act. The provisions of said section have been made applicable to a statement to be delivered or cause to be delivered on or after the first day of July, 2012. 23. Reading the above said provisions of the Act, it transpires that where tax ha .....

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uction at source on quarterly basis. Section 234E of the Act levies fees for default in furnishing the statements of tax deducted at source. Such fees is to be paid before delivering or causing to be delivered a statement in accordance with section 200(3) of the Act or proviso to section 206C(3) of the Act. In other words, in case the assessee has defaulted in not delivering the statement or causing to deliver the statement within time prescribed, then he is liable to pay the fees which is so pr .....

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e tax, sum deductible under the Chapter and / or their payment, the Assessing Officer is empowered to make adjustments in this regard and also reject incorrect claim made by the deductor which is apparent from the information in the statement filed by the deductor. Further, the Income- tax authority is authorized to charge interest, if any, and the same shall be computed on the basis of sums deductible in addition to the amount of tax deducted at source, which is to be paid to the account of Tre .....

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015 w.e.f. 01.06.2015. Prior to the said substitution though the provisions of section 234E of the Act for payment of fees for default in furnishing the statement were inserted by the Finance Act, 2012 w.e.f. 01.07.2012, the prescribed authority did not have the power to charge the said fees, while processing the quarterly statements / returns under section 200A of the Act. 24. Now, looking at various provisions of the Act, the issue needs to be adjudicated in the case of assessee, wherein admit .....

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tution of clause (c) to section 200A(1) of the Act by the Finance Act, 2015 w.e.f. 01.06.2015, the Assessing Officer was not empowered to charge fees under section 234E of the Act. The case of Revenue on the other hand, was that it was the duty of deductor while furnishing the statement under section 200(3) of the Act to deposit the fees referred to in section 234E(1) of the Act. The learned CIT-DR stressed that fees referred to in sub-section (1) had to be paid while delivering or causing to de .....

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filed before the prescribed authority within stipulated time, the assessee was liable to levy of fees under section 234E of the Act. However, in case any default occurs due to the non-payment of fees by the assessee in this regard, then the provisions which has to be considered is section 200A(1)(c) of the Act. The power to charge / collect fees as per provisions of section 234E of the Act was vested with the prescribed authority under the Act only on substitution of earlier clause (c) to secti .....

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nce the power has been given, under which any levy has to be imposed upon tax payer, then such power comes into effect from the date of substitution and cannot be applied retrospectively. The said exercise of power has been provided by the statute to be from 01.06.2015 and hence, is to be applied prospectively. There is no merit in the claim of Revenue that even without insertion of clause (c) under section 200A(1) of the Act, it was incumbent upon the assessee to pay fees, in case there is defa .....

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n 234E of the Act while issuing intimation under section 200A of the Act. Before exercising the authority of charging any sum from any deductor or the assessee, the prescribed authority should have necessary power vested in it and before vesting of such power, no order can be passed by the prescribed authority in charging of such fees under section 234E of the Act, while exercising jurisdiction under section 200A of the Act. Thus, in the absence of enabling provisions, under which the prescribed .....

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nder section 200A of the Act prior to 01.06.2015. 26. The Amritsar Bench of Tribunal in Sibia Healthcare (P) Ltd. v. DCIT [2015] 121 DTR 81 (Asr) (Trib) had held that the adjustment in respect of levy of fees under section 234E of the Act was indeed beyond the scope of permissible adjustments contemplated under section 200A of the Act. Such a levy could not be effected in the course of intimation under section 200A of the Act and in the absence of any other provisions enabling the demand in resp .....

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95/Ahd/2014, relating to assessment year 2013-14, vide consolidated order dated 26.11.2015 and Chandigarh Bench of Tribunal in M/s. Khanna Watches Ltd. v. DCIT in ITA Nos.731 to 735/CHD/2015, relating to assessment years 2014-15 & 2013-14, order dated 29.10.2015. 27. While deciding the present bunch of appeals, the Revenue had placed reliance on the ratio laid down by the Hon'ble Bombay High Court in Rashmikant Kundalia v. Union of India (supra) wherein, the constitutional validity of se .....

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turns within specified period from the date of filing, the returns could not be accurately processed of such person on whose behalf tax has been deducted i.e. deductee, until information of such deductions is furnished by the deductor within the prescribed time. Since the substantial number of deductors were not filing their TDS returns / statements within prescribed time frame, then it lead to an additional work burden upon the Department due to the fault of the deductor and in this light and t .....

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by payment of fees as set out in section 234E of the Act. Therefore, the findings of Hon'ble High Court were thus, that the fees sought to be levied under section 234E of the Act was not in the guise of tax sought to be levied on the deductor. The provisions of section 234E of the Act were held to be not onerous on the ground that section does not empower the Assessing Officer to condone the delay in late filing the income tax returns or that no appeal is provided from arbitrary order passe .....

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vided for the provisions of section 234E of the Act, the same cannot be said to be onerous and section 234E of the Act was held to be constitutionally valid. The constitutional validity of provisions of section 234E of the Act has also been upheld by the Hon'ble Rajasthan High Court in M/s. Dundlod Shikshan Sansthan & Anr. v. Union of India and Ors (supra). 28. In view of the above said ratio laid down by the Hon'ble Bombay High Court, the case of the learned CIT-DR before us was tha .....

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ore insertion of clause (c) to section 200A(1) of the Act by the Finance Act, 2015 w.e.f. 01.06.2015. The learned Authorized Representative for the assessee on the other hand, drew our attention to the Memorandum to the Finance Bill, 2015 while introducing the said clause (c) to section 200A(1) of the Act. The Finance Bill took note of the provisions of Chapter XVIIB, under which the person deducting tax i.e. deductor was required to file quarterly tax deduction at source statement containing th .....

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inserted section 200A in the Act, which provided for furnishing of TDS statements for determining the amount payable or refundable to the deductor. It further took note that however, as section 234E of the Act was inserted after the insertion of section 200A in the Act, the existing provisions of section 200A of the Act does not provide for determination of fees payable under section 234E of the Act at the time of processing of TDS statements. It was thus, proposed to amend the provisions of se .....

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le under section 234E of the Act. The Finance Bill further refers to the existing provisions of the Act i.e. after processing of TDS statement, intimation is generated specifying the amount payable or refundable. This intimation generated after processing of TDS statement is (i) subject to rectification under section 154 of the Act; (ii) appealable under section 246A of the Act; and (iii) deemed as notice of payment under section 156 of the Act. The Finance Bill further provided that intimation .....

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e not being referred to. The Finance Bill further provided that the amendment would take effect from 01.06.2015. 29. The perusal of Memo explaining the provision relating to insertion of clause (c) to section 200A of the Act clarifies the intention of Legislature in inserting the said provision. The provisions of section 234E of the Act were inserted by the Finance Act, 2012, under which the provision was made for levy of fees for late furnishing TDS / TCS statements. Before insertion of section .....

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Act at the time of processing the TDS statements. So, when section 234E of the Act was introduced, it provided that the person was responsible for furnishing the TDS returns / statements within stipulated period and in default, fees would be charged on such person. The said section itself provided that fees shall not exceed the amount of tax deducted at source or collected at source. It was further provided that the person responsible for furnishing the statements shall pay the said amount whil .....

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00A(1) of the Act by the Finance Act, 2015 w.e.f. 01.06.2015. Accordingly, we hold that where the Assessing Officer has processed the TDS statements filed by the deductor, which admittedly, were filed belatedly but before insertion of clause (c) to section 200A(1) of the Act w.e.f. 01.06.2015, then in such cases, the Assessing Officer is not empowered to charge fees under section 234E of the Act while processing the TDS returns filed by the deductor. 30. The Hon'ble Bombay High Court in Rash .....

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oposition that fees under section 234E of the Act is chargeable in the case of present set of appeals, where the Assessing Officer had issued the intimation under section 200A of the Act prior to 01.06.2015. 31. Another aspect of the issue is whether the amendment brought in by the Finance Act, 2015 w.e.f. 01.06.2015 by way of insertion of clause (c) to section 200A(1) of the Act is clarificatory or is prospective in nature and is not applicable to the pending assessments. Undoubtedly, the provi .....

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cer to charge and collect such fees. In the absence of enabling provisions, the Assessing Officer while processing the TDS statements, even if the said statements are belated, is not empowered to charge the fees under section 234E of the Act. The amendment was brought in by the Finance Act, 2015 w.e.f. 01.06.2015 and such an amendment where empowerment is given to the Assessing Officer to levy or charge the fees cannot be said to be clarificatory in nature and hence, applicable for pending asses .....

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Bill, 2015 very clearly also recognizes that and refers to the current provisions of sub-section (3) to section 200 of the Act, under which the deductor is to furnish TDS statements. However, as section 234E of the Act was inserted after insertion of section 200A in the Act, the existing provisions of section 200A of the Act did not provide for determination of fees payable under section 234E of the Act at the time of processing of TDS statements. In this regard, it was thus, proposed to amend .....

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.e. prior to 01.06.2015, the Assessing Officer at the time of processing the TDS statements did not have power to charge fees under section 234E of the Act and in order to cover up that, the amendment was made by way of insertion of clause (c) to section 200A of the Act. In such scenario, it cannot be said that insertion made by section 200A(1)(c) of the Act is retrospective in nature, where the Legislature was aware that the fees could be charged under section 234E of the Act as per Finance Act .....

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rnataka High Court in Writ Appeal Nos.2663-2674/2015(T-IT) & Ors in Sri Fatheraj Singhvi & Ors v. Union of India & Ors has quashed the intimation issued under section 200A of the Act levying the fees for delayed filing the TDS statements under section 234E of the Act. The Hon'ble High Court notes that the Finance Act, 2015 had made amendments to section 200A of the Act enabling the Assessing Officer to make adjustments while levying fees under section 234E of the Act was applicab .....

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is regard, wherein the constitutional validity of section 234E of the Act has been upheld. 34. Accordingly, we hold that the amendment to section 200A(1) of the Act is procedural in nature and in view thereof, the Assessing Officer while processing the TDS statements / returns in the present set of appeals for the period prior to 01.06.2015, was not empowered to charge fees under section 234E of the Act. Hence, the intimation issued by the Assessing Officer under section 200A of the Act in all t .....

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t wherein it was held that before 01.06.2015, whether the Assessing Officer had authority to pass a separate order under section 234E of the Act levying fees for delay in filing the TDS statements under section 200(3) of the Act; the Tribunal held 'yes' that the assessing authority had such power and after 01.06.2015, the Assessing Officer was within his limit to levy fees under section 234E of the Act even while processing the TDS statements under section 200A of the Act. In view of the .....

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own by Hon'ble Delhi High Court in CIT v. Naresh Kumar (supra). However, in view of our decision in the paras hereinabove, where power is being enshrined upon the Assessing Officer to levy or charge while processing the TDS returns w.e.f. 01.06.2015, such provision cannot have retrospective effect as it would be detrimental to the case of tax payer. The Hon'ble Delhi High Court was considering the application of amendment to section 40(a)(ia) of the Act by the Finance Act, 2010, under wh .....

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roducing clause (c) to section 200A(1) of the Act and hence, cannot be applied retrospectively. Similarly, reliance placed upon by the learned CIT-DR on the ratio laid down by the Hon'ble Supreme Court in Govinddas v. ITO (supra) is misplaced because of the distinguishable facts and issues. 37. Now, coming to the connected issue raised by the learned Authorized Representative for the assessee by way of ground of appeal No.1 that whether any appeal is maintainable against the intimation issue .....

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E of the Act. Without going into various aspects of the issue, we make reference to the Memorandum explaining the Finance Bill, 2015, under which the heading was rationalization of provisions relating to Tax Deduction at Source (TDS) and Tax Collection at Source (TCS). The said memorandum categorically recognized that under the existing provisions of the Act, after processing of TDS statements, an intimation is generated specifying the amount payable or refundable. It was further noted that this .....

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on is generated under which, if any amount is found to be payable, then such intimation generated after processing of TDS returns is subject to rectification under section 154 of the Act and / or is also appealable under section 246A of the Act, since the demand issued by the Assessing Officer is deemed to be a notice of payment under section 156 of the Act. Since the intimation in question issued by the Assessing Officer was appealable order under section 246A(1)(a) of the Act, therefore, the C .....

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section 200A of the Act, we hold that such intimation issued by the Assessing Officer after processing the TDS returns is appealable. The demand raised by way of charging of fees under section 234E of the Act is under section 156 of the Act and any demand raised under section 156 of the Act is appealable under section 246A(1)(a) and (c) of the Act. Accordingly, we reverse the findings of CIT(A) in this regard. We find support from the similar proposition being laid down by Mumbai Bench of Tribun .....

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