TMI Blog2023 (12) TMI 281X X X X Extracts X X X X X X X X Extracts X X X X ..... nce 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 of the Act and the liability shall continue for every day during which the failure continues. Sub-section (3) to Section 234E of the Act provides that the fee referred to in subsection (1) to Section 234E of the Act 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.Importantly, sub-section (4) to Section 234E of the Act provides that the above provisions would apply to statement referred to in sub-section (3) to Section 200 of the Act which is to delivered or cause to delivered on or after 01.07.2012. Section 234 E of the Act and on considering both the above views, it appears to me that the opinion expressed by the Gujarat High Court that [ 2017 (7) TMI 458 - GUJARAT HIGH COURT] Section 234E of the Act by itself creates a liability and the liability to pay the late fee is not dependent on Section 200A(1)(c) of the Act which only prescribes the recovery mechanism reflects the true inte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for the financial years 2012- 13, 2013-14, 2014-15 and 2015-16 intimating the sum due and payable in terms of Section 200A of the Act. Thereafter on 19.01.2021 yet another intimation with regard to the outstanding demand of TDS of Rs. 6,54,350/- was issued for the period 2010-11 to 2015-16. 2.3. The petitioner submitted its response vide letter dated 29.01.2021 wherein it was stated that the Income Tax Department was not empowered to levy late fee under Section 234E of the Act prior to 01.06.2015, while also stating that interest could be waived and hence requested waiver of late fee and interest. The impugned order considering the above letter dated 29.01.2021 was passed stating that there is no power of waiver with regard to late fee under Section 234E of the Act and thus the request for waiver stood rejected while also drawing the attention of the petitioner to the judgment of the Madras High Court in the case of Qatalys Software Technologies Pvt. Limited reported in 115 taxmann.com 345 wherein the validity of the late fee levied under Section 234E of the Act was upheld and also to the judgment of the Gujarat High Court in the case of Rajesh Kourani v. Union of India and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the Act prior to 01.06.2015 was held to be without authority of law. In this regard it may be relevant to refer to the judgment of the Karnataka High Court in the case of Fatheraj Singhvi and others Vs. Union of India and others wherein it was held as under : 22. It is hardly required to be stated that, as per the well established principles of interpretation of statute, unless it is expressly provided or impliedly demonstrated, any provision of statute is to be read as having prospective effect and not retrospective effect. Under the circumstances, we find that substitution made by clause (c) to (1) of sub-section (1) of Section 200A can be read as having prospective effect and not having retroactive character or effect. Resultantly, the demand under Section 200A for computation and intimation for the payment of fee under Section 234E could not be made in purported exercise of power under Section 200A by the respondent for the period of the respective assessment year prior to 1.6.2015. However, we make it clear that, if any deductor has already paid the fee after intimation received under Section 200A, the aforesaid view will not permit the deductor to reopen the said que ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ain defaults in filing the statements. Under no circumstances a machinery provision can override or overrule a charging provision. We are unable to see that s. 200A of the Act creates any charge in any manner. It only provides a mechanism for processing a statement for tax deduction and the method in which the same would be done. When s. 234E has already created a charge for levying fee that would thereafter not been necessary to have yet another provision creating the same charge. Viewing s. 200A as creating a new charge would bring about a dichotomy. In plain terms, the provision in our understanding is a machinery provision and at best provides for a mechanism for processing and computing besides other, fee payable under s. 234E for late filing of the statements. 20. Even in absence of s. 200A of the Act with introduction of s. 234E, it was always open for the Revenue to demand and collect the fee for late filing of the statements. Sec. 200A would merely regulate the manner in which the computation of such fee would be made and demand raised. In other words, we cannot subscribe to the view that without a regulatory provision being found for s. 200A for computation of fee, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of charging capital gain on transfer of a capital asset. In case on hand, the asset was in the nature of goodwill. The Supreme Court referring to various provisions concerning charging and computing capital gain observed that none of these provisions suggest that they include an asset In the acquisition of which no cost can be conceived. In such a case, the asset is sold and the consideration is brought to tax, what is charged is a capital value of the asset and not any profit or gain. This decision therefore would not apply in the present case. In Dundlod Shikshan Sanasthan v Union of India reported in 284 CTR 175 (RAJ) 8. In the present case, the fee was levied under Section 200 for late filing of the returns, prior to the amendments made by the Finance Act, 2015 with effect from 1.6.2015 in Sections 200A, 246A and 272A providing for computation and appeal. We do not find that even prior to these amendments the imposition of fee was illegal. We do not in exercise of the power under Article 226 of the Constitution of India find any valid reasons or justification to interfere with the compensatory fees imposed for late filing of the TDS returns on flat rates. 7. Be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Court that Section 234E of the Act by itself creates a liability and the liability to pay the late fee is not dependent on Section 200A(1)(c) of the Act which only prescribes the recovery mechanism reflects the true intent and purpose of Section 234E of the Act. Section 234E of the Act which provides for late fee is the substantive provision and the levy is not dependent on Section 200A(1)(c) of the Act which only prescribes a recovery mechanism. A reading of Section 234E of the Act would make it clear that it gets attracted, the moment there is a failure on the part of a person to deliver or cause to be delivered a statement within the time prescribed in subsection (3) of Section 200 or the proviso to sub Section (3) of Section 206C of the Act. The person committing the above breach / infraction renders himself liable to pay by way of fee a sum of Rs. 200 everyday during which the failure continues. Sub-section (3) in fact provides for a self assessment / payment of the fee while delivering or causing to deliver a statement in accordance with sub-section(3) of Section 200 or the proviso to sub-section(3) of Section 206C of the Act. Sub Section(4) to Section 234E of the Act also m ..... X X X X Extracts X X X X X X X X Extracts X X X X
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