TMI Blog2021 (5) TMI 584X X X X Extracts X X X X X X X X Extracts X X X X ..... . Joint Commissioner of Income Tax [ 2018 (9) TMI 289 - ITAT DELHI] the question arose whether since on filing belated returns/statements, Revenue had not suffered any loss because tax deducted was already deposited on time and there was mere technical or venial breach to provisions contained in Act for submitting return/statements of TDS. Therefore, penalty was not to be levied and question was answered in favour of the assessee. - ITA No. 2410/PUN/2017 - - - Dated:- 17-5-2021 - SHRI INTURI RAMA RAO , ACCOUNTANT MEMBER AND SHRI PARTHA SARATHI CHAUDHURY , JUDICIAL MEMBER Assessee by : Shri Pramod Shingte Revenue by : Shri S.P Walimbe ORDER PER PARTHA SARATHI CHAUDHURY, JM: This appeal preferred by the assessee emanates from the order of the Ld. CIT(Appeals)-1, Aurangabad dated 21.07.2017 for the assessment year 2011-12 passed u/s.272A(2)(K) r.w.s.200(3) of the Income Tax Act, 1961 ( hereinafter referred to as the Act‟) as per the following grounds of appeal on record : On the facts and circumstances of the case and in law, the Learned Assessing Officer has erred in levying the penalty under section 272A(2)(k) of Income Tax Act, 1961 for a sum ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 260 The Assessing Officer was of the opinion that in this case there was delay in delivering the copy of statement is 564 days, 472 days, 380 days, 452 days, 564 days, 472 days, 380 days and 260 days and the tax deductible relating to the statement in question is ₹ 8,200/-, ₹ 12,600/-, ₹ 22,100/-, ₹ 2,81,096/-, ₹ 2,63,035/-, ₹ 1,96,039/-, ₹ 75,298/- and ₹ 30,030/- respectively. Therefore, Assessing Officer held that the assessee has committed a default in not delivering the E-TDS statements within the specified time without any reasonable cause and accordingly, levied penalty of ₹ 2,55,700/- u/s.272A(2)(k) of the Act. 3. The Ld. CIT(Appeals) has confirmed the action of the Ld. Jt. Commissioner of Income Tax in levying penalty of ₹ 2,55,700/- u/s.272A(2)(k) of the Act as per reasons recorded in his order vide Para 5, 5.1, 5.2 which are on record. 4. The Ld. AR for the assessee submitted that due to frequent changes in the software, non-availability of PANs and lack of knowledge about electronic filing, there was delay in e-filing and the assessee had deducted and paid TDS along with interest. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Mumbai Bench of the Tribunal in the case of The Board of Control for Cricket In India Vs. ACIT (TDS)-2, ITA No.1999/Mum/2017 dated 05.10.2018. The provisions of Section 272A(2)(k) are subject to provisions of section 273B of the Act and hence, the relevance of reasonable cause has to be established. For the sake of completeness, the observations and findings of the Pune Bench of the Tribunal in the above referred case are as follows: 17. We have heard the rival contentions and perused the record. In this bunch of appeals, the issue which arises for adjudication is against the levy of penalty under section 272A(2)(k) of the Act for late filing of TDS statements / returns. In this regard, reference is being made to the relevant provisions of the Act. Under Chapter XVII of the Act, duty is upon the person making certain payments to deduct tax at source under the respective sections. The said tax deducted at source is due to be the income received by the deductee as per section 198 of the Act. Section 199 of the Act further provides that where any deduction is made under the Chapter and paid to the Central Government, then the same is to be treated as payment of tax on behalf ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 Central Government or as the Board directs. Under section 200(2) of the Act, any person being an employer, as referred to in sub-section (1A) of section 192 of the Act shall pay, within the prescribed time, the tax to the credit of the Central Government or as the Board directs. Under sub- section (2A) of the Act, it is provided that where the sum has been deducted in accordance with foregoing provisions of the Chapter, by the office of the Government, then duty is upon the Treasury Officer or the Drawing 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, I.T.A. No.1999/Mum/2017 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 as an employer r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... office of Government and also quote PAN number of all the deductees. Further, the deductor was required to furnish the particulars of tax paid to the Central Government including Book I.T.A. No.1999/Mum/2017 Identification Number or challan indication number as the case may be. He was also required to furnish the particulars of amount paid or credited on which tax was not deducted. 21. In view of various provisions of the Act, as pointed out above, the substitution was made by Income Tax (Sixth) Amendment Rules, 2010 and was applicable for the financial year 2010-11. Since e-compliance of TDS returns was introduced in the said financial year, there was time and again amendments/corrections in order to make system of filing TDS returns user-friendly. The learned Authorized Representative for the assessee has pointed out that there were about 18 amendments / corrections in this regard. In the present set of appeals before us admittedly, there was default in furnishing e-TDS statements late for the respective quarters by different assessee, but all relating to assessment year 2011-12. The question which arises for adjudication before us is whether in such cases where e- TDS was m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not filing e- TDS returns in time and as such, no merit in levy of penalty. Another plea raised before us is that charging of fees for each day of default and then, restricting the same to the tax deducted at source was not correct. One another aspect of reasonableness was that in case the returns for quarter 1 was filed belatedly, then the returns for consequent quarters also got delayed for no default and as such, no penalty was leviable for such quarters. Different learned Authorized Representatives appearing before us has made reference to the decisions of various Benches of Tribunal. On the other hand, the learned Departmental Representative for the Revenue has placed reliance on the ratio laid down by the Hon'ble Allahabad High Court in Raja Harpal Singh Inter College's case (supra) and Chandigarh Bench of Tribunal in Central Scientific Instruments Organization's case (supra). One last aspect pointed out by the learned Authorized Representative for the assessee was that the CIT(A) has acknowledged that there was reasonable cause in not furnishing e-TDS returns in time. However, no benefit of the same was given to the assessee because the CIT(A) was of the view th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of technical hitches, the TDS returns could not be filed in time. Most of the assessee before us have paid the tax deducted at source to the Treasury within time frame but have defaulted in filing e-TDS statements. In some of the cases, there is default in payment of tax deducted at source and consequently, delay in filing the e-TDS returns. The question which arises is whether in the abovesaid scenario, can the provisions of section 273B of the Act can be applied in order to decide the issue of levy of penalty under section 272A(2)(k) of the Act. 24. The Hon'ble Punjab Haryana High Court in HMT Ltd. v. CIT [2005] 274 ITR 544/[2004] 140 Taxman 606 had held that where the tax deducted at source had been paid in time and the necessary returns in respect thereto were filed in time with the Income Tax Department, on mere late issue of tax deduction certificate, there was no loss to the Revenue and the delay in furnishing the tax deduction certificate was held to be merely technical or venial in nature and penalty levied under section 272A(2)(k) of the Act was deleted. It may be clarified herein that earlier under section 272A(2)(k) of the Act, penalty was leviable where th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... statements in time. The Hon'ble High Court thus, in this regard observed that the requirement of filing e-TDS statements in time could not be overlooked. In such circumstances, the Hon'ble High court held that it cannot be urged by the Counsel for the assessee that no penalty could have been imposed for non-filing e-TDS returns in time since it had not resulted in any loss to the Revenue. The Hon'ble High Court further took note of the fact that before the Assessing Officer, no explanation was offered. However, an explanation was offered before the appellate authority, which was taken into consideration and the penalty amount was suitably reduced as the case of appellant that regular Principal assumed charge on 25.01.2010, was accepted and the penalty was imposed after that date. The appeal of the assessee in this regard was thus, dismissed. 26. Applying the said ratio laid down by the Hon'ble Allahabad High Court in Raja Harpal Singh Inter College's case (supra), there is no merit in the plea of the learned Departmental Representative for the Revenue that the Hon'ble High Court has laid down the proposition that in every case of default in filing the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onable cause as relevant to section 273B of the Act put up by the assessee in the respective cases in the appeals before us, which admittedly relate to different quarters of assessment year 2011-12. Where for the first time, there was requirement of e-TDS furnishing of TDS statement and since there were certain complications in e-filing of TDS returns because of system failure, which admittedly, was amended 18 times by the Department, the delay in furnishing the said returns late I.T.A. No.1999/Mum/2017 could not be attributed to the assessee. The onus was upon the authorities to provide platform for easy compliance to newly introduced provisions of the Act. Where such facilities could not be provided by the authorities and the technical support not being available to small assessees, who are in appeal before us, then the delay in furnishing the e-TDS returns late should be liberally construed. Hence, there was practical difficulty on the part of assessee to comply with newly introduced requirement of e- TDS filing of TDS statements, being technical delay and not venial in nature, merits to be considered as reasonable cause for non-levy of penalty as per the requirements of section ..... X X X X Extracts X X X X X X X X Extracts X X X X
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