CRYSTAL PHARMA PRIVATE LIMITED V. ASSISTANT/DEPUTY COMMISSIONER OF INCOME TAX

WP/104175/2023

AI Insights

Crystal Pharma Private Limited filed a writ petition against various authorities of the Income Tax Department, challenging the demand notices issued for late fees under Section 234-E of the Income Tax Act for late filing of TDS returns. The notices were issued for multiple financial years, but all were dated prior to the amendment of Section 200-A, which became effective on 01.06.2015. The petitioner argued, supported by a previous judgment of the High Court, that the amendment is prospective and should not apply retroactively to demands made for periods before this date. The court agreed with this interpretation and quashed the demand notices.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 771292 (HC-KARNATAKA)
• Appeal Type: Others
• Pronouncement Date: 08-08-2023
• Assessment Year: misc
• Other Referred Cases: W.A.No.2663-2674/2015 (T-IT)
• Laws Referred To: Income Tax Act
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: Y V RAVIRAJ
• Assessee Lawyers: MANOJKUMAR PUKALE
• Keywords: Demand notice; Late fee; Prospective effect; Quashed; TDS returns
• Section: 220(2); 226; 227; 234(E); 200-A

Judgement Text

" - 1 - NC: 2023:KHC-D:8506 WP No. 104175 of 2023 IN THE HIGH COURT OF KARNATAKA, DHARWAD BENCH DATED THIS THE 8TH DAY OF AUGUST, 2023 BEFORE THE HON'BLE MR JUSTICE SACHIN SHANKAR MAGADUM WRIT PETITION NO. 104175 OF 2023 (T-IT) BETWEEN: CRYSTAL PHARMA PRIVATE LIMITED, (PAN: AAACC7447C; TAN: BLRC02432D) CIN: U24232GA1988PTC000834, REPRESENTED BY PRINCIPAL, OFFICER/AUTHORISED/KEY PERSON: MANJU W/O. SUNIL KOTHARI, AGE: MAJOR, ADDRESS: 2ND FLOOR, ASHWAMEDHA TRADE CENTRE, DAJIBANPETH, HUBBALLI-580028, MOBILE: [phone], EMAIL: [e-mail] …PETITIONER (BY SRI MANOJKUMAR D. PUKALE, ADVOCATE) AND: 1. ASSISTANT/DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL PROCESSING CEL TDS, AAYAKAR BHAWAN, SECTOR-3, VAISHALI, GHAZIABAD 201010 UTTARA PRADESH, TEL: [phone], EMAIL: [e-mail] 2. DEPUTY COMMISSIONER OF INCOME TAX CIRCLE1(1) PANAJI, AREA CODE: KAR; AO, TYPE: C; AO NO.1, RANGE CODE: 511, JURISDICTION CIRCLE 1(1), PANAJI, O/O: CHIEF COMMISSIONER OF INOCOME TAX, 2ND FLOOR, AAYAKAR BHAVAN, E.D.C. COMPLEX, PATTO PLAZA, PANAJI-403001, MOHANKUMAR B SHELAR Digitally signed by MOHANKUMAR B SHELAR Location: DHARWAD Date: 2023.08.10 13:27:42 -0700 - 2 - NC: 2023:KHC-D:8506 WP No. 104175 of 2023 EMAIL: panaji. [e-mail] 3. COMMISSIONER OF INCOME TAX (APPEALS), GOI., MOF., INCOME TAX DEPARTMENT, NATIONAL FACELESS APPEAL CENTRE (NFAC), NAFAC, C-BLOCK, 4TH FLOOR, S P.M. CIVIC CENTRE, NEW DELHI-110001. EMAIL: [e-mail] TEL: [phone] (D) 011-23221454 MOBILE: [phone]. COMMISSIONER OF INCOME TAX (APPEALS - UNIT-1) HUBBALLI, CENTRAL REVENUE BUILDING, NAVANAGAR, P.B. ROAD, HUBBALLI-580025, TEL: [phone], MOBILE: [phone], EMAIL: hubli. cit1.appeal. [e-mail] 5. CHIEF COMMISSIONER OF INCOME TAX, 2ND FLOOR, AAYAKAR BHAVAN, E.D.C. COMPLEX, PATTO PLAZA, PANAJI-403001, EMAIL: [e-mail]. TEL: [phone], MOBILE: [phone]. INCOME TAX OFFICER, TDS WARD, HUBLI, C.R. BUILDING, NAVANAGAR, HUBBALLI, 580025, EMAIL: [e-mail] …RESPONDENTS (BY SRI Y.V. RAVIRAJ, ADVOCATE) THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO ISSUE WRIT/S BY WAY OF CERTIORARI TO QUASH INTIMATIONS OF R-1 IN ANNEXURE 'B' SERIES AS BELOW WITH CONSEQUENTIAL CHARGE OF INTEREST U/S. 220(2) OF IT ACT. - 3 - NC: 2023:KHC-D:8506 WP No. 104175 of 2023 i) FIN YR.2012-13, ASTM. YR 2013-14, INTIMATION COM/REF.NO.TDS/1213/26Q/D/100001247251 TDS/1213/26Q/D/ 100001247252 TDS/1213/26Q/D/100001247253 DATED 05-09-13 FORM AND QUARTER 26Q Q 226Q Q 326Q Q 4234E DEMAND 274003560012800 ANNX-B, B1, B2; FIN YR.2012-13, ASMT. YR 2013-14, INTIMATION COM/REF.NO.TDS/1213/24Q/D/10000 3834146 DATED 12-11-13 FORM AND QUARTER 24Q Q 4234E DEMAND 5000 ANNX-B3; ii) FIN YR 2013-14, ASMT.YR 2014-15, INTIMATION COM/ REF.NO.TDS/1314/26Q/D/100010620792 DATED 15-07-14 FORM AND QUARTER 26Q Q 1234E DEMAND 60589, ANNX-B4; FIN.YR 2013-14, ASMT.YR 2014-15, INTIMATION COM/REF.NO.TDS/1314/ 26Q/D/100011189283, TDS/1314/26Q/D/100010963234 DATED 22- 07-14 FORM AND QUARTER 26Q Q 226Q Q3234E DEMAND 5500036600 ANNX-B5, B6; FIN.YR 2013-14, ASMT.YR 2014-15, INTIMATION COM/REF.NO.TDS/1314/26Q/D/100011189284 DATED 28-07-14 FORM AND QUARTER 26Q Q 4234E DEMAND 12600 ANNX- B7; iii) FIN. YR 2014-15, ASMT.YR2015-16, INTIMATION COM/REF.NO.TDS/1415/26Q/D/100016435785TDS/1415/26Q/D/100 016435504TDS/1415/26Q/D/100016436379 DATED 08-10-15 FORM AND QUARTER 26Q Q 226Q Q 326Q Q 4234E DEMAND 710005260028600 ANX-B8, B9, B10. THIS PETITION, COMING ON FOR PRELIMINARY HEARING, THIS DAY, THE COURT MADE THE FOLLOWING: - 4 - NC: 2023:KHC-D:8506 WP No. 104175 of 2023 ORDER Captioned petition is filed feeling aggrieved by the impugned demand notice issued by the Authorities under Section 234-E of the Income Tax Act calling upon the petitioner to pay late fee to the tune of Rs.27,400/- in filing TDS returns vide Annexures at 'B' series. 2. Heard the counsel appearing for the petitioner and the learned counsel appearing for the respondent-authority. 3. Perused the impugned demand notice. The learned counsel for the petitioner has placed reliance on the judgment rendered by Hon'ble Division Bench of Co-ordinate Bench this Court in W.A.No.2663-2674/2015 (T-IT) and connected matters disposed on 26.08.2016 4. I have given my anxious consideration to the law laid down by the Division Bench. While interpreting with Section 234-E of the Act, the Division Bench having taken cognizance of the amendment, which is dated 01.06.2015 was of the view that amendment made under Section 200-A of the Act, having come into effect on 01.06.2015, is held to be having prospective effect and therefore, no computation of fee for the - 5 - NC: 2023:KHC-D:8506 WP No. 104175 of 2023 demand or the intimation for the fee under section 234-E could be made for the TDS deducted for the respective assessment year prior to 01.06.2015. 5. Admittedly the demand notices issued vide Annexure B series are prior to 01.06.2015. In the light of the law laid down by the Division Bench in excluding the transactions prior to 01.06.2015, the impugned demand notices issued by the Authority vide Annexure at \"B\" series are liable to be quashed insofar as recovery pertains to Section 234-E of the Act. With these observations, I proceed to pass the following: ORDER i) The writ petition stands allowed in part. ii) The demand notices issued vide annexures at 'B' series under Section 234-E of the Act are hereby quashed. iii) In view of disposal of the petition, pending interlocutory applications, if any, do not survive for consideration and are disposed of accordingly. Sd/- JUDGE YAN, List No.: 1 Sl No.: 28 "