HEADMASTER V. INCOME TAX OFFICER TDS

WP(C)/1078/2022

AI Insights

The case involves the Headmaster of a Government Upper Primary School in Nallepilly, Palakkad, who challenged the imposition of late filing fees under section 234E of the Income Tax Act, 1961, for not filing tax deduction at source statements from 2012-13 to 2014-15. The petitioner argued that the late fees were not applicable as section 200A, which governs the imposition of such fees, came into effect only on 01.06.2015. The respondents, including various income tax authorities, contended that the fees were rightly imposed and that the petitioner had previously availed statutory remedies which barred further challenge under Article 226 of the Constitution. The court, however, found the imposition of the late fees to be unauthorized based on the precedent from M/s.Sarala Memorial Hospital's case.

• Counselvise Citation: [2022] 140 COUNSELVISE.COM (IT) 765520 (HC-KERALA)
• Appeal Type: Others
• Pronouncement Date: 18-05-2022
• Assessment Year: misc
• Other Referred Cases: M/s.Sarala Memorial Hospital v. Union of India and Another (W.P.(C) No.37775 of 2018)
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Revenue
• Court: HIGH COURT
• Department Lawyers: CHRISTOPHER ABRAHAM; S MANU
• Assessee Lawyers: SASIDHARAN; P J ANILKUMAR; K N SREEKUMARAN; SANTHOSH KUMAR
• Keywords: Late filing fee; Section 200A; Section 234E; Tax deduction at source
• Section: 234E; 200A

Judgement Text

"IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR. JUSTICE BECHU KURIAN THOMAS WEDNESDAY, THE 18TH DAY OF MAY 2022 / 28TH VAISAKHA, 1944 WP(C) NO. 1078 OF 2022 PETITIONER: HEADMASTER GOVERNMENT UPPER PRIMARY SCHOOL, DEPARTMENT OF EDUCATION, NALLEPILLY, PALAKKAD – 678553 (REP. BY SRI.SASIDHARAN M.P. BY ADVS. SRI.P.J.ANILKUMAR SRI.K.N.SREEKUMARAN SRI.SANTHOSHKUMAR N. RESPONDENTS: 1 INCOME TAX OFFICER (TDS) AAYKAR BAHVAN, ENGLISH CHRUCH ROAD, PALAKKAD, PIN - 678014 2 ASSISTANT COMMISSIONER OF INCOME TAX TDS ,CPC, AAYAKAR BHAVAN, SECTOR-3, VAISHALI, GAZIABAD, UTTARPRADESH, PIN - 201010 3 COMMISSIONER OF INCOME TAX (APPEALS) NATIONAL FACELESS APPEAL CENTRE, NEW DELHI, PIN - 110003 4 CENTRAL BOARD OF DIRECT TAXES NORTH BLOCK, NEW DELHI-110002 REP. BY ITS CHAIRMAN 5 THE UNION OF INDIA MINISTRY OF FINANCE, DIRECT TAXES DEPARTMENT, W.P.(C) No.1078/22 -:2:- NEW DELHI, PIN – 110001 REP. BY ITS SECRETARY BY ADVS. SRI.CHRISTOPHER ABRAHAM, SC INCOME TAX DEPARTMENT SRI.S.MANU, ASGI THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 01.04.2022, THE COURT ON 18.05.2022 DELIVERED THE FOLLOWING: W.P.(C) No.1078/22 -:3:- BECHU KURIAN THOMAS, J. ----------------------------------------- W.P.(C) No.1078 of 2022 ---------------------------------------- Dated this the 18th day of May, 2022 JUDGMENT By Ext.P1 to Ext.P4 intimations, petitioner has been called upon to pay the late filing fee under section 234E of the Income Tax Act, 1961 (for short,'the Act'). 2. As per the aforesaid intimations, amounts have been demanded as late fee for the periods from 2012-13 to 2014-15 on the basis of the provisions in section 234E of the Act, which is as follows: “234E-Fee for default in furnishing statements:- (1) Without prejudice to the provisions of the Act, where 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, he shall be liable to pay, by way of fee, a sum of two hundred rupees for every day during which the failure continues.” 3. Though section 234E of the Act was introduced by the Finance Act, 2012 with effect from 1st July, 2012, since petitioner is being demanded by Ext.P1 to Ext.P4 late fee for not filing the statement of tax deduction at source, it is necessary to refer to W.P.(C) No.1078/22 -:4:- section 200A of the Act. Section 200A(1) incorporated clause (c) to clause (f) with effect from 01.06.2015. Sub-clause to section 200A (1) refers to the fee if any to be computed in accordance with the provisions of section 200A(1)(e). It is the claim of the petitioner that till 01.06.2015 petitioner cannot be mulcted with any liability to pay late fee for non filing of any statement of tax deduction at source. 4. A statement has been filed by the respondents contending that demands for late fee under section 234E of the Act were raised against the petitioner on 25.09.2018. Challenging the demands, petitioner had preferred appeals and the appeals were dismissed as per Ext.P6 to Ext.P9 orders. It was further pleaded that in the circumstances of the case, since statutory appeals were preferred by the petitioner and the appeals were decided against him, he cannot thereafter turn around and question the demands under Article 226 of the Constitution of India. 5. I have heard Sri.P.J.Anilkumar, learned counsel for the petitioner, Sri.Christopher Abraham, learned Standing Counsel for the respondents 1 to 4 as well as Sri.S.Manu, learned Assistant Solicitor General of India for the fifth respondent. 6. In the decision in M/s.Sarala Memorial Hospital v. Union W.P.(C) No.1078/22 -:5:- of India and Another (W.P.(C) No.37775 of 2018) an identical question arose for consideration. After considering the statutory provisions and the implications of the amendment brought in to the Act, it was held that the amendment under section 234E would take effect only from 1st June, 2015, since section 200A was made effective only from that date. The aforesaid judgment has become final and is binding upon the authorities. 7. In view of the above, the demand in Ext.P1 to Ext.P4 intimations for the period from 2012-13 to 2014-15 is bereft of authority and cannot be legally sustainable. 8. However, the respondents have raised a contention that pursuant to Ext.P1 to Ext.P4 intimations, petitioner had preferred appeals and those appeals resulted in dismissal. Thus the statutory remedy having been invoked, according to the respondents, petitioner cannot challenge the intimations issued earlier. 9. Petitioner has thereafter amended the writ petition and incorporated a challenge against the appellate orders. 10. This Court had already declared that section 234E has no application prior to 01.06.2015 since section 200A was inserted only from that day. Thus for the period prior to 01.06.2015, respondents W.P.(C) No.1078/22 -:6:- had no jurisdiction or authority to impose the late fee. The decision in M/s.Sarala Memorial Hospital's case has become final and binding. Since the judgment of the jurisdictional High Court was not considered by the Appellate Authority, Ext.P6, Ext.P7, Ext.P8 and Ext.P9 are perverse, warranting interference under Article 226 of the Constitution of India. 11. Since the judgment in M/s.Sarala Memorial Hospital's case (supra) declared that late fee under Section 234E cannot be imposed prior to 01.06.2015, no purpose will be served by sending the case back to the Tribunal. The levy of late fee is without authority and legally invalid. 12. Accordingly, I quash Ext.P1 to Ext.P4 intimations to the extent it demands late fee under section 234E for the period from 2012-13 till 01.06.2015. The writ petition is therefore allowed as above. Sd/- BECHU KURIAN THOMAS JUDGE vps W.P.(C) No.1078/22 -:7:- APPENDIX OF WP(C) 1078/2022 PETITIONER'S/S' EXHIBITS EXHIBIT P1 TRUE COPY OF THE INTIMATION OF LEVY U/S 234E, AGAINST 24Q OF Q3 FOR F.Y: 2012-13 ISSUED BY THE 2ND RESPONDENT TO THE PETITIONER. EXHIBIT P2 TRUE COPY OF THE INTIMATION OF LEVY U/S 234E, AGAINST 24Q OF Q4 FOR F.Y:2012-13 ISSUED BY THE 2ND RESPONDENT TO THE PETITIONER. EXHIBIT P3 TRUE COPY OF THE INTIMATION OF LEVY U/S 234E, AGAINST 24Q OF Q4 FOR F.Y:2013-14 ISSUED BY THE 2ND RESPONDENT TO THE PETITIONER. EXHIBIT P4 TRUE COPY OF THE INTIMATION OF LEVY U/S 234E, AGAINST 24Q OF Q1 FOR F.Y:2014-15 ISSUED BY THE 2ND RESPONDENT TO THE PETITIONER EXHIBIT P5 TRUE COPY OF THE INTIMATION LETTER DATED 25.09.2018 ISSUED BY THE 1ST RESPONDENT EXHIBIT P6 TRUE COPY OF THE APPELLATE ORDER FOR THE ASSESSMENT YEAR 2013-14 AGAINST EXT- P1(RELEVANT FINANCIAL YEAR 2012-13) ISSUED BY 3RD RESPONDENT TO THE PETITIONER. EXHIBIT P7 TRUE COPY OF THE APPELLATE ORDER FOR THE ASSESSMENT YEAR 2013-14 AGAINST EXT-P2 (RELEVANT FINANCIAL YEAR 2012-13) ISSUED BY 3RD RESPONDENT TO THE PETITIONER EXHIBIT P8 TRUE COPY OF THE APPELLATE ORDER FOR THE ASSESSMENT YEAR 2014-15 AGAINST EXT-P3 (RELEVANT FINANCIAL YEAR 2013-14) ISSUED BY 3RD RESPONDENT TO THE PETITIONER. EXHIBIT P9 TRUE COPY OF THE APPELLATE ORDER FOR THE ASSESSMENT YEAR :2015-16 AGAINST EXT-P4 (RELEVANT FINANCIAL YEAR 2014-15) ISSUED BY 3RD RESPONDENT TO THE PETITIONER "