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Nimaben Rameshbhai Thakkar Versus The Dy. Commissioner of Income-tax TDS, Ghaziabad (UP)

2018 (1) TMI 331 - ITAT AHMEDABAD

Levy of late filing fees u/s 234E in the course of processing under section 200A - Held that:- We find that the issue in appeal is covered by larger number of decisions, including several decisions of Ahmedabad benches of this tribunal in favour of the assessee. These decisions categorically hold that the amendment brought about in section 200A with effect from 1st June 2015 and by virtue of Finance Act, 2015 is prospective in effect and it cannot apply to the period prior to 1st June 2015. - .....

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15 - Dated:- 4-1-2018 - Pramod Kumar AM and S S Godara JM Rupesh R Shah for the Appellant Mudit Nagpal for the Respondent ORDER Per Pramod Kumar, AM 1. By way of this appeal, the assessee-appellant has challenged correctness of the order dated 4th September 2015 passed by the by the CIT(A)-8, Ahmedabad, in the matter of levy of late filing fees under section 234E, in the course of processing under section 200A of the Income-tax Act, 1961, for the assessment year 2014-15. 2. The grievances raised .....

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he action of ld. DCIT, TDS, CPC, Ghaziabad while passing the orders without properly appreciating the fact and that she further erred in grossly ignoring various submissions, explanations and information submitted by the appellant from time to time which ought to have been considered before passing the impugned order. This action of both the authorities is in clear breach of law and principles of natural justice and therefore deserves to be quashed. 2. There is no dispute that the issue in appea .....

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different conclusion. Learned CIT(A) has held that the amendment to section 200A with effect from 1st June 2015 is retrospective in effect. She has thus justified levy of late filing fees under section 234E in the course of processing under section 200A of the Act, even before the amendment of section 200A with effect from 1st June 2015. The stand of the Assessing Officer was thus upheld and the grievance of the assessee thus rejected. The assessee is not satisfied and is in appeal before us. 3 .....

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and it cannot apply to the period prior to 1st June 2015. While holding so, one of the coordinate benches, in the case of Sibia Healthcare Private Limited (supra), has held as follows:- "4. We have heard the rival contentions, perused the material on record and duly considered facts of the case in the light of the applicable legal position. In addition to his argument on the merits, learned counsel has also invited our attention to the reports about the decisions of various Hon'ble Hig .....

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s raised in respect of fees under section 234E. The full text of these decisions were not produced before us. However, as admittedly there are no orders from the Hon'ble Courts above retraining us from our adjudication on merits in respect of the issues in this appeal, and as, in our humble understanding, this appeal requires adjudication on a very short legal issue, within a narrow compass of material facts, we are proceeding to dispose of this appeal on merits. 5. We may produce, for ready .....

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wo 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 .....

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ed at source (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 stateme .....

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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: 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 .....

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to, the deductor as required under the said subsection. 7. By way of Finance Act 2015, and with effect from 1st June 2015, there is an amendment inSection 200A and this amendment, as stated in the Finance Act 2015, is as follows: In section 200A of the Income-tax Act, in sub-section (1), for clauses (c) to (e), the following clauses shall be substituted with effect from the 1st day of June, 2015, namely:- "(c) the fee, if any, shall be computed in accordance with the provisions of section .....

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f refund due to the deductor in pursuance of the determination under clause (d) shall be granted to the deductor. 8. In effect thus, post 1st June 2015, in the course of processing of a TDS statement and issuance of intimation under section 200A in respect thereof, an adjustment could also be made in respect of the "fee, if any, shall be computed in accordance with the provisions of section 234E". There is no dispute that what is impugned in appeal before us is the intimation under sec .....

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ng the following adjustments: (a). after making adjustment on account of "arithmetical errors" and "incorrect claims apparent from any information in the statement" - Section 200A(1)(a) . (b) after making adjustment for 'interest, if any, computed on the basis of sums deductible as computed in the statement". - Section 200A(1)(b) 9. No other adjustments in the amount refundable to, or recoverable from, the tax deductor, were permissible in accordance with the law as .....

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tified the levy of fees on the basis of the provisions of Section 234E. That is not the issue here. The issue is whether such a levy could be effected in the course of intimation under section 200A. The answer is clearly in negative. No other provision enabling a demand in respect of this levy has been pointed out to us and it is thus an admitted position that in the absence of the enabling provision under section 200A, no such levy could be effected. As intimation under section 200A, raising a .....

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ction 234 E is unsustainable in law. We, therefore, uphold the grievance of the assessee and delete the impugned levy of fee under section 234E of the Act. The assessee gets the relief accordingly." 5. We find that, rather than respectfully following the binding judicial precedent, the CIT(A) has embarked upon a detailed analysis to write antithesis of the binding judicial precedent. These heroics are completely out of place; once a higher tier of the judicial hierarchy expressed the views .....

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te of UP, AIR 1980 SC 1762 : (1980) 3 SCC 719 [p. 1764 of AIR 1980 (SC)], "Every new discovery nor argumentative novelty cannot undo or compel reconsideration of a binding precedent......A decision does not lose its authority 'merely because it was badly argued, indequately considered or fallaciously reasoned...." Similarly in the case of Kesho Ram & Co. vs. Union of India (1989) 3 SCC 151, it was stated by the Supreme Court thus :'The binding effect of a decision of this C .....

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ble Supreme Court itself has quoted from the decision of House of Lords as under: We desire to add and as was said in Cassell & Co. Ltd. v. Broome (1972) AC 1027 (HL), we hope it will never be necessary for us to say so again that "in the hierarchical system of Courts" which exists in our country, "it is necessary for each lower tier", including the High Court, "to accept loyally the decision of the higher tiers". "It is inevitable in hierarchical system of .....

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rvations of Hon ble Supreme Court and permits her better wisdom to yield the higher wisdom of the Income Tax Appellate Tribunal, which is placed higher in the judicial hierarchy vis-a-vis the CIT(A). 7. Having said that, we may also add that the reasoning of the learned CIT(A) is based on the proposition that the amendment brought about by the Finance Act, 2015 is a curative amendment and therefore, it is retrospective in effect. In coming to this conclusion, she has been guided by the decision .....

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efit appears to have been the objective pursued by the legislature, it would a purposive interpretation giving it a retrospective effect but when a tax legislation imposes a liability or a burden, the effect of such a legislative provision can only be prospective. In Hon ble Supreme Court s five-Judge Constitution Bench s landmark judgment, in the case of CIT vs. Vatika Townships (P) Ltd. (2014) 271 CTR (SC) 1 : (2014) 109 DTR (SC) 33 : 2014 TIOL 78 SC, the legal position in this regard has been .....

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