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2018 (4) TMI 706

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..... Shri Bhagchand, AM And Shri Kul Bharat, JM Assessee by : None (One set W.S. filed) Revenue by : Shri J.C. Kulhari (JCIT) ORDER Per : Kul Bharat, J. M. This is an appeal filed by the assessee emanates from the order of the ld. CIT(A), Ajmer dated 10/11/2017 for the A.Y. 2014-15(26Q 1st, 2nd, 3rd 4th Qtr), wherein the assessee has raised sole effective ground of appeal, which is against not deleting the penalty of ₹ 89,760/- levied U/s U/s 234E of the Income Tax Act, 1961 (in short the Act). 3. In this appeal, the only issue involved is not admitting the appeal and not deleting the penalty levied U/s 234E of ₹ 89,760/- filed by the assessee for the reason that notice of demand was sent to the assessee on 30/05/2014 on e.mail No. RCAGARWALSG@YAHOO.CO.IN. The ld CIT(A) has held that as per Section 249(2) of the Act, the appeal has to be presented within 30 days from the date of service of notice of demand. The appellant has not filed the appeal within the specified period and there was an inordinate delay in filing the appeal. The assessee did not have any sufficient cause for not presenting the appeal within the period specified U/s 249(2) of th .....

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..... 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 authority6 or the person authorised by such authority such statement in such form7 and verified in such manner and setting forth such particulars and within such time as may be prescribed: It is also levied for violation of Section 206C (3) of the Act, which is as under:- (3) Any person collecting any amount under sub-section (1) or sub-section (1C) 29[***] shall pay within the prescribed30 time the amount so collected to the credit of the Central Government or as the Board directs : Provided that the person collecting tax on or after the 1st day of April, 2005 in accordance with the foregoing provisions of this section shall, after paying the tax collected 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 authority31, or the person authorised by such authority, such statement in such form and verified in such manner and setting forth such particu .....

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..... 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 credit of the Central Government or as the Board directs. (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 a correction statement for rectification of any mistake or to add, delete or update the information furnished in the s .....

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..... eed 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 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. 12. On a perusal of sub-section (1) of section 234E, it is clear that a fee is sought to be levied inter alia on a person who fails to deliver or cause to be delivered the TDS return/statements within the prescribed time in sub-section (3) of section 200. The fee prescribed is ₹ 200/- for every day during which the failure continues. Sub- section (2) further stipulates that 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. 13. It is not in dispute that as per the existing .....

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..... S statements were furnished within the prescribed time. This fee is for the payment of the additional burden forced upon the Department. A person deducting the tax (the deductor), is allowed to file his TDS statement beyond the prescribed time provided he pays the fee as prescribed under section 234E of the Act. In other words, the late filing of the TDS return/statements is regularised upon payment of the fee as set out in section 234E. This is nothing but a privilege and a special service to the deductor allowing him to file the TDS return/statements beyond the time prescribed by the Act and/or the Rules. We therefore cannot agree with the argument of the Petitioners that the fee that is sought to be collected under section 234E of the Act is really nothing but a collection in the guise of a tax. 16. We are supported in our view by a judgment of a division bench of the Calcutta High Court in the case of Howrah Tax Payers' Association v. Government of West Bengal [2011] 5 CHN 430. Before the Calcutta High Court, the constitutional validity of imposition of a late fee under section 32(2) of the West Bengal Value Added Tax Act, 2003 came up for consideration. After analys .....

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..... sn. v. Hyderabad Municipal Corpn. [(1999) 2 SCC 274] it was held that the traditional concept of quid pro quo in a fee has undergone considerable transformation. So far as the regulatory fee is concerned, the service to be rendered is not a condition precedent and the same does not lose the character of a fee provided the fee so charged is not excessive. It was not necessary that service to be rendered by the collecting authority should be confined to the contributories alone. The levy does not cease to be a fee merely because there is an element of compulsion or coerciveness present in it, nor is it a postulate of a fee that it must have a direct relation to the actual service rendered by the authority to each individual who obtains the benefit of the service. Quid pro quo in the strict sense was not always a sine qua non for a fee. All that is necessary is that there should be a reasonable relationship between the levy of fee and the services rendered. It was observed that it was not necessary to establish that those who pay the fee must receive direct or special benefit or advantage of the services rendered for which the fee was being paid. It was held that if one who is liable .....

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..... r wider meaning, than what appears on the face of it. It is only when all efforts to do so fail should the Court declare a statute to be unconstitutional. 20. It is equally well settled that a statute relating to economic activities should be viewed with greater latitude than laws touching civil rights such as freedom of speech, freedom of religion etc. As regards economic and other regulatory legislation it is imperative that the Court exercises judicial restraint and grants greater latitude to the legislature whilst judging the constitutional validity of such a statute. This is for the simple reason that the Court does not consists of economic and administrative experts and has no expertise in these matters. 21. These well settled principles have been very succinctly set out in the judgment of the Supreme Court in the case of Government of Andhra Pradesh v. Smt. P. Laxmi Devi [2008] 4 SCC 720 and more particularly, paragraphs 46, 67, 68, 78, 79 and 80 thereof, which read thus: '46. In our opinion, there is one and only one ground for declaring an Act of the legislature (or a provision in the Act) to be invalid, and that is if it clearly violates some provision .....

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..... elating to economic activities should be viewed with greater latitude than laws touching civil rights such as freedom of speech, freedom of religion, etc. Thus, the Constitution Bench decision in R.K. Garg case [(1981) 4 SCC 675 : 1982 SCC (Tax) 30] is an authority for the proposition which has been stated herein, namely, when a law of the legislature encroaches on the civil rights and civil liberties of the people mentioned in Part III of the Constitution (the fundamental rights), such as freedom of speech, freedom of movement, equality before law, liberty, freedom of religion, etc., the Court will not grant such latitude to the legislature as in the case of economic measures, but will carefully scrutinise whether the legislation on these subjects is violative of the rights and liberties of the citizens, and its approach must be to uphold those rights and liberties, for which it may sometimes even have to declare a statute to be unconstitutional. 79. Some scholars regarded it a paradox in the judgments of Holmes, J. (who, as we have already stated above, was a disciple of Thayer) that while he urged tolerance and deference to legislative judgment in broad areas of law-making .....

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