AMBIT SOFTWARE PVT LTD,PUNE V. ITO TDS, TDS WARD 1, PUNE, PUNE

ITA 1150/PUN/2025

AI Insights

Ambit Software Private Limited filed a series of appeals against the late fees charged under section 234E of the Income-tax Act for delayed TDS returns for the assessment year 2015-16. The fees were imposed by the Central Processing Cell (CPC) during the processing of these returns under section 200A. The company argued that the fees were improperly levied for returns filed before the amendment date of June 1, 2015, which allowed such charges. The Tribunal considered similar cases and precedents, ultimately deciding that the fees could only be levied for defaults occurring after the specified amendment date. The Tribunal also addressed the issue of procedural delay in filing the appeals, accepting the company's reasons for the delay and allowing the appeals to be heard on merits.

• Counselvise Citation: [2026] 140 COUNSELVISE.COM (IT) 841919 (ITAT-PUNE)
• Duration Of Justice: 9 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-02-2026
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Assessment Year: misc
• Appeal Filed On: 01-05-2025
• Other Referred Cases: Hutatma Jaiwantrao Patil Girls High School & Junior College Himayatnagar Vs. ACIT, CPC, Shrikrishna Laxminarayan Thakur Vs. ITO, TDS Ward, Kolhapur, Olari Little Flower Kuries Pvt. Ltd. Vs. Union of India and others, Jiji Varghese VS. ITO(TDS) & Ors., Dadasaheb Vitthalrao Urhe Vs. ITO (TDS), Pune, Collector, Land Acquisition, Anantnag & Anr. Vs. Mst. Katiji & Ors., Inder Singh Vs. State of Madhya Pradesh
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: UDOL RAJ SINGH
• Assessee Lawyers: ABHAY AVCHAT
• Keywords: Reasonable cause; Bonafide belief; TDS
• Section: 154

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCHES “A”, PUNE BEFORE DR.MANISH BORAD, ACCOUNTANT MEMBER AND SHRI VINAY BHAMORE, JUDICIAL MEMBER Sl. No. ITA No(s). Name of the Applicant Name of Respondent Asst. Year Quar ter Form 1-6 ITA Nos.1149 to 1154/PUN/2025 Ambit Software Private Limited, Unit No.104A, First Floor, The Chambers, Nagar Road, Viman Nagar, Pune 411014 Maharashtra PAN : AAFCA9195G ITO (TDS) TDS Ward,-1, Pune 2015-16 2015-16 2015-16 2015-16 2015-16 2015-16 Q2 Q1 Q3 Q3 Q2 Q1 26Q 26Q 26Q 24Q 24Q 24Q आदेश / ORDER PER BENCH: This batch of six appeals at the instance of assessee are directed against the different orders dated 30.01.2025 passed by the National Faceless Appeal Centre (NFAC), Delhi u/s.250 of the Income-tax Act, 1961 (in short ‘the Act’). The only issue raised in these appeals is against the charging of late fee u/s.234E for the quarters arising in Assessment Year 2015-16. 2. Identical grounds have been raised by assessee in all these appeals. We therefore proceed to dispose of these appeals by this consolidated order for the sake of convenience. 3. Brief facts common to these appeals are that TDS returns for the assessment year 2015-16 corresponding to respective quarters captioned above were filed belatedly. The same were processed by Central Processing Cell (in short “CPC”) u/s.200A Assessee by : Shri Abhay Avchat Revenue by : Shri Udol Raj Singh Date of hearing : 19.02.2026 Date of pronouncement : 23.02.2026 Printed from counselvise.com ITA Nos.1149 to 1154/PUN/2025 Ambit Software Private Limited 2 levying fee u/s.234E of the Act. The assessee filed rectification applications u/s.154 of the Act for removal of late fee u/s.234E but failed to succeed. Aggrieved assessee preferred appeal(s) before Ld. CIT(A)/NFAC but failed to get any relief. Now the assessee is in appeal(s) before the Tribunal. 4. At the outset, ld. Counsel for the assessee referring to various decisions including that of this Coordinate Bench in the case of Hutatma Jaiwantrao Patil Girls High School & Junior College Himayatnagar Vs. ACIT, CPC – ITA Nos. 1916 to 1918/PUN/2025 and others order dated 16.02.2026 submitted that in light of the above decisions fee levied by the CPC u/s.234E of the Act in the processing u/s.200A of the Act for the delay in filing return prior to 01.06.2015 deserves to be deleted and only the fee for the default committed after 01.06.2015 can be levied. 5. Ld. Departmental Representative relied on the orders passed by the lower authorities and submitted that ld.CIT(A) has not condoned the delay in filing of the appeals and that the assessee has not been able to satisfy ld.CIT(A) for the abnormal delay of about 6 ½ years giving rise to the said delay and therefore finding of ld.CIT(A) needs to be affirmed. 6. We have heard the rival contentions and perused the record placed before us. The sole grievance of the assessee in the instant bunch of 6 appeals is against levy of fee u/s.234E of the Act levied by the CPC in the processing of TDS returns u/s.200A of the Act. Commonly in the appeals before ld.CIT(A) assessee failed to get relief as the delay in filing of the appeals has not been condoned. Ld. Counsel for the assessee referring to the affidavit filed by the assessee demonstrated the reasons for delay in filing the appeals before ld.CIT(A). Contents of said affidavit reads as follows : Printed from counselvise.com ITA Nos.1149 to 1154/PUN/2025 Ambit Software Private Limited 3 “2. The Company was in receipt of intimation u/s 200A / 154 from TDS- CPC for various years such as for the FY 2012-13, FY 2013-14, FY 2014- 15 and FY 2015-16 on the common issue of levy u/s 234E. 3. Earlier the appeal was filed, before the Honorable Commissioner of Income Tax (Appeals) -10, Pune against the TDS intimation for all the four quarters of the F.Y. 2014-15. At the same time, appeal was filed before the CIT A for other years i.e. FY 2012 13, 13 14 and 15 16 on the same issue of levy u/s 234E. 4. The CIT A-10, Pune passed a combined order for the FY 2014 15 vide appellate order dated 30th July 2019. On face of the said appellate order, there was a mention /reference of only one quarter i.e. quarter 4 of Form 24Q and Form 26Q with its demand of Rs. 27,800 and Rs. 20,200/- respectively. However, company had filed form 35 for FY 2014 15 for all the quarters against aggregate demand of Rs. 2.95 lacs. The said fact is mentioned in the grounds of appeal reproduced in the combined appellate order dated 30/07/2019. 5. The Company was advised by the previous council that since the quarterly TDS returns of the quarters in FY 2014-15 were filed/uploaded in August 2015 i.e. after amended date of 1 June 2015, no further appeal would be worthwhile. Thereafter and also during covid period, no decision was taken on this issue by the company. In October and November 2023, the company was in receipt of TDS demand recovery notice from the TDS ward office, Pune regarding outstanding TDS demand for the FY 2014-15. 6. 7. The said matter of outstanding TDS demand was referred to other council who after verifying the cause and status of demand advised us to file appeal before the ITAT against the appellate order passed by the CIT A-10, Pune which was passed in July 2019. 8. Assessee filed appeal before the ITAT Pune Bench on 12th Jan 2024 against the said appellate order of the CIT A-10, Pune pertaining to FY 14-15 covering 6 appeals (ITA No. 82 to 87/PUN/2024). However, the said appeals were withdrawn and stood dismissed in the ITAT Pune bench. The said order was passed by the ITAT dated 26th April 2024. The reason was that company did not file the said appeals (6) appeals) before the CIT A and the same were directly filed before the ITAT. Therefore, it was discussed during appellate proceedings before the tribunal to withdraw the said appeals so that the company would get remedy of filing CIT A at its end and the same can be filed before the appropriate forum. 9. The said mistake happened because we were under impression that the CIT A's order passed in July 2019 covered the whole FY 2014-15 and not only 4th quarter. This fact was pointed out / noticed during the ITAT hearing in April 2024. Printed from counselvise.com ITA Nos.1149 to 1154/PUN/2025 Ambit Software Private Limited 4 10. Thereafter we filed appeal before the CIT A, NFAC for the said year, covering six appeals, which were belated. There was delay of almost 9 years. The NFAC passed appellate order dated 30/01/2025 dismissing our appeal on the issue of delay condonation as well as on merits. 11. Now we are in appeal before the ITAT Pune Bench against the said appellate order of NFAC 12. The delay in filing of six appeals before the CIT A, NFAC had occurred due to the reasons explained as above i.e. incorrect legal advice of earlier council and bonafide impression of company regarding the period covered in the appellate order passed in July 2019. All these facts came to notice in Nov 2023 and June 2014. 13. Since the delay occurred due to inadvertent error and bonafide belief, it is requested to your honour to condone the delay in filing of appeal before the CIT A. We do not have any intention to overlook the provisions of the law. 14. It is apparent that the appeal is being filed on a belated date. We request your honour to condone the delay in filling the appeal and admit the appeal memo.” 7. We have gone through the reasons which gave rise to the delay and on perusal of the same, we find that ‘reasonable cause’ prevented the assessee from filing the appeals before ld.CIT(A) within the prescribed time limit. Considering the issue involved and in the larger interest of justice and placing reliance on the judgments of Hon’ble Apex Court in the case of Collector, Land Acquisition, Anantnag & Anr. Vs. Mst. Katiji & Ors. reported in (1987) 2 SCC 107 and in the case of Inder Singh Vs. State of Madhya Pradesh judgment dated 21.03.2025 (2025 INSC 382) we condone the delay before ld.CIT(A) in the instant batch of appeals and proceed on merits of the case. 8. We find that in the instant batch of appeals TDS returns filed by the assessee for various quarters for A.Y. 2015-16 have been processed by the CPC and fee u/s.234E of the Act has been levied for the delay in filing of the TDS returns. It has been pleaded that the CPC had no jurisdiction to levy fee u/s.234E of the Act in the processing of TDS returns u/s.200A of the Act upto Printed from counselvise.com ITA Nos.1149 to 1154/PUN/2025 Ambit Software Private Limited 5 the amendment which has come into effect from 01.06.2015 and therefore fee levied u/s.234E of the Act in the processing u/s.200A of the Act prior to 01.06.2015 deserves to be deleted. For those TDS returns which have been processed from 01.06.2015 and onwards then the fee u/s.234E is to be levied only for the default committed from 01.06.2015 and onwards. We find that similar issue came for adjudication before this Tribunal in the case of Shrikrishna Laxminarayan Thakur Vs. ITO, TDS Ward, Kolhapur – ITA Nos. 2299 to 2307/PUN/2024 order dated 23.01.2025 and the finding of Tribunal reads as under : “5. We have heard both the parties and perused the records placed before us. The solitary issue in this batch of appeals is against the levy of fee u/s.234E of the Act by CPC for delay in filing the TDS quarterly returns and Ld. CIT(A)/NFAC confirming such levy of fee u/s.234E for filing the Quarterly returns after the due date. 6. We observe that the issue of levy of fee u/s.234E is no more res integra by virtue of several decisions rendered by this Tribunal on this very issue. It shows that the late fee u/s.234E has been imposed for the delay in furnishing the statements for quarters, in the returns processed u/s.200A of the Act prior to 01.06.2015 and post 01.06.2015. As regards the fate of fees levied u/s.234E of the Act for the returns filed and processed before 01.06.2015, we find the Coordinate Benches of this Tribunal after considering the judicial pronouncements have been taking a consistent view that the amendment brought in Finance Act, 2015 w.e.f. 01.06.2015 under Section 200A (clause (c)] of the Act is prospective in nature thereby empowering the Revenue authorities to charge fee u/s.234E of the Act only after 01.06.2015. In that view of the matter, Revenue authorities are empowered to impose such late fee u/s.234E only for the default committed after 01.06.2015 and not prior to that. The Hon’ble Kerala High Court in Olari Little Flower Kuries Pvt. Ltd. Vs. Union of India and others (2022) 440 ITR 26 (Kerala) has affirmed the non-imposition of fee for the period prior to 01.06.2015. Similar view has been taken in Jiji Varghese VS. ITO(TDS) & Ors. (2022) 443 ITR 267 (Ker) holding that no fee u/s.234E can be imposed for the periods of the respective A.Ys. prior to 1st June, 2015. Similar view was also taken by this Tribunal in the case of Dadasaheb Vitthalrao Urhe Vs. ITO (TDS), Pune in ITA Nos.1286 to 1309/PUN/2023, dated 29.02.2024. Thus, it is seen that the issue raised in the following appeals is covered in favour of the assessee as the returns u/s.200A(c) were processed before 01.06.2015. Printed from counselvise.com ITA Nos.1149 to 1154/PUN/2025 Ambit Software Private Limited 6 Sl. No. ITA No(s). Asst. Year Quar ter Form Order date 1 ITA Nos.2299/PUN/2024 2013-14 Q4 26Q 20.01.2014 2 ITA No.2300/PUN/2024 2014-15 Q1 26Q 15.03.2014 3 ITA No.2301/PUN/2024 2014-15 Q2 26Q 15.03.2014 4 ITA No.2302/PUU/2024 2014-15 Q3 26Q 15.03.2014 5 ITA No.2303/PUN/2024 2014-15 Q4 26Q 11.10.2014 6 ITA No.2165/PUN/2024 2013-14 Q3 26Q 20.01.2014 7 ITA No.2166/PUN/2024 2013-14 Q2 26Q 20.01.2014 8 ITA No.1322/PUN/2024 2013-14 Q2 26Q 20.01.2014 7. Following the precedent, we overturn the impugned orders on this sole issue and allow the effective grounds of appeal raised by the assessee in all these eight appeals. 8. So far as the following appeals corresponding to respective quarter are concerned, the late fee u/s.234E has been imposed for the delay in furnishing the statements and the returns have been processed u/s.200A of the Act after 01.06.2015. In light of our observation above, it is held that penalty u/s.234E is leviable since amendment brought in Finance Act, 2015 w.e.f. 01.06.2015 under Section 200A (clause (c)] of the Act is prospective in nature and Revenue authorities are empowered to levy penalty u/s.234E. However, penalty u/s.234E has to be computed from 01.06.2015 till the processing of the return for which necessary calculation to be made at the end of the concerned Revenue authority. The details of appeals whose returns have been processed after 01.06.2015 are given below : Sl. No. ITA No(s). Asst. Year Quar ter Form Order date 1 ITA Nos.2304/PUN/2024 2015-16 Q1 26Q 27.10.2015 2 ITA No.2305/PUN/2024 2015-16 Q4 26Q 28.10.2015 3 ITA No.2306/PUN/2024 2015-16 Q3 26Q 24.10.2015 4 ITA No.2307/PUU/2024 2015-16 Q2 26Q 24.10.2015 5 ITA No.2308/PUN/2024 2016-17 Q1 26Q 25.08.2016 Accordingly, the grounds of appeal raised by the assessee in respect of the above-mentioned five appeals are partly allowed.” 9. Now examining the facts of the instant appeals in light of the above decision, we observe that the assessee has furnished a short summary depicting the detail of date of order u/s.200A of the Act and the same is reproduced below : Printed from counselvise.com ITA Nos.1149 to 1154/PUN/2025 Ambit Software Private Limited 7 10. Applying the ratio laid down by this Tribunal in the case Shrikrishna Laxminarayan Thakur Vs. ITO (supra) on the facts of the instant case, we hold that fee u/s.234E of the Act levied for the delay in filing the TDS returns prior to 01.06.2015 deserves to be deleted and for the delay from 01.06.2015 and onwards the fee levied u/s.243E stands confirmed. Revenue is directed to make necessary calculation and give the relief to the assessee as directed above. Grounds of appeal raised by the assessee are partly allowed. 11. In the result, all the appeals of the assessee are partly allowed as per terms indicated above. Order pronounced on this 23rd day of February, 2026. Sd/- Sd/- (VINAY BHAMORE) (MANISH BORAD) JUDICIAL MEMBER ACCOUNTANT MEMBER पुणे / Pune; दिन ांक / Dated : 23rd February, 2026. Satish Printed from counselvise.com ITA Nos.1149 to 1154/PUN/2025 Ambit Software Private Limited 8 आदेश की प्रतिलिपि अग्रेपिि / Copy of the Order forwarded to : 1. अपील र्थी / The Appellant. 2. प्रत्यर्थी / The Respondent. 3. The Pr. CIT concerned. 4. विभ गीय प्रतितनधि, आयकर अपीलीय अधिकरण, “A” बेंच, पुणे / DR, ITAT, “A” Bench, Pune. 5. ग र्ड फ़ इल / Guard File. आिेश नुस र / BY ORDER, // True Copy // Assistant Registrar आयकर अपीलीय अधिकरण, पुणे / ITAT, Pune. Printed from counselvise.com "