Rishiraj Homes Private Limited, Jamshedpur V. ITO(TDS), Jamshedpur

ITA 104/RAN/2019

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 1765 (ITAT-RANCHI)
• Duration Of Justice: 2 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-05-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2013-2014
• Appeal Filed On: 05-03-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: P K MONDAL ACIT
• Assessee Lawyers: JAGDISH KHANDELWAL CAAR
• Keywords: TDS; Set aside
• Section: 201(1); 234E; 200A; 201; 207

Judgement Text

, . . , IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH , RANCHI , BEFORE SHRI CHANDRA MOHAN GARG, JUDICIAL MEMBER ./ ITA NO. 104, 206 & 207 / RAN /20 1 9 ( / ASSESSMENT YEAR : 20 1 3 - 14, 2014 - 15 & 2015 - 16 ) RISHIRAJ HOMES PRIVATE LIMITED CONTRACTORS AREA, BISTUPUR, JAMSHEDPUR, C/O: CA JAGDISH KHANDELWAL, 402&403, A.J.TOWER, Q. ROAD, BISTUPUR, JAMSHEDPUR - 831001 VS. ITO(TDS), JAMSHEDPUR ./ ./ PAN/GIR NO. : A ACCR 7328 H ( / APPELLANT ) .. ( / RESPONDENT ) /AS SESSEE BY : SHRI JAGDISH KHANDELWAL , CA(AR) /REVENUE BY : SHRI P.K.MONDAL , ACIT( DR ) / DATE OF HEARING : 2 1 / 0 5 /201 9 / DATE OF PRONOUNCEMENT 21 / 0 5 /201 9 / O R D E R TH ESE THREE APPEAL S HA VE BEEN FILED BY THE ASSESSEE AGAINST THE SEPARATE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS), JAMSHEDPUR , ALL DATE D 05.11.2018 FOR THE ASSESSMENT YEAR S 201 3 - 2014 , 2014 - 2015 & 2015 - 2016 , RESPECTIVELY . 2. THE SOLE ISSUE INVOLVED IN ALL THE THEE APPEALS OF THE ASSESSEE IS THAT THE CIT(A) ERRED IN CONFIRMING THE ORDER OF AO LEVYING LATE FEE U/S.234E OF THE ACT FOR DELAY IN FILING QUARTERLY STATEMENT. 3. BR IEF FACTS OF THE CASE ARE THAT THE ASSESSEE FILED TDS RETURN IN FORM NO.24Q FINANCIAL YEAR 201 2 - 201 3 , 2013 - 2014 & 2014 - 2015 RELATING TO ASSESSMENT YEAR 201 3 - 201 4 , 2014 - 2015 & 2015 - 2016, RESPECTIVELY. THEREAFTER A DEMAND WAS RAISED IN ALL THE THREE APPEALS UNDER ITA NO. 104. 206&207 / R AN /201 9 2 CONSIDERATION ON ACCOUNT OF LATE FILING FEE U/S.234E OF THE ACT. THEREAFTER THE ASSESSEE FILED A PETITION U/S.154 OF THE ACT BEFORE THE ITO TDS WARD, JAMSHEDPUR FOR RECTIFICATION OF THE DEMAND, DURING PENDENCY OF THE SAME, FINAL DEMAND NOTICE ON ACCO UNT OF LATE FILING FEE U/S.234E OF THE ACT WAS SERVED ON THE ASSESSEE IN ALL THE CASES. AGAINST, WHICH THE ASSESSEE PREFERRED APPEAL BEFORE THE CIT(A). HOWEVER, THE CIT(A) OBSERVED THAT THERE IS NO SUCH JUDGMENT/ORDER BROUGHT TO HIS NOTICE WHICH IS FAVOURA BLE TO THE ASSESSEE AND ACCORDINGLY DISMISSED THE APPEAL OF THE ASSESSEE HOLDING THAT THE LATE FEE HAS CORRECTLY BEEN LEVIED FOR CERTAIN DEFAULTS IN FILING THE STATEMENTS. 4. NOW, THE ASSESSEE IS IN FURTHER APPEALS BEFORE THE TRIBUNAL. 5. LD. AR, AT THE O UTSET, SUBMITTED THAT THE AMENDMENT BROUGHT IN THE FINANCE ACT 2015 W.E.F.01.06.2015 IN SECTION 200A OF THE INCOME TAX ACT, 1961 IS PROSPECTIVE IN NATURE, THEREFORE, NO COMPUTATION OF LATE FEE OR DEMAND OR INTIMATION U/S.234E OF THE ACT COULD BE MADE FOR T DS DEDUCTED IN RESPECTIVE STATEMENTS PRIOR TO 01.06.2015 AND PROCESSED U/S.200A OF THE ACT. FURTHER, THE LD. AR RELIED ON THE ORDER OF COORDINATE BENCH OF THE TRIBUNAL IN THE CASE OF STATE BANK OF INDIA, GWALIOR VS. CIT(A), ITA NO.442/AG/2018, ORDER DATED 09.04.2018, WHEREIN THE TRIBUNAL HAS DECIDED THE ISSUE IN FAVOUR OF THE ASSESSEE BY FOLLOWING THE DECISION IN THE CASE OF SUDERSHAN GOYAL VS. DCIT(TDS), ITA NO.442/AGRA/2017, ORDER DATED 09.04.2018. LD. AR FURTHER PLACED RELIANCE ON THE DECISION OF HON'BLE KARNATAKA HIGH COURT IN THE CASE OF FATEHRAJ SINGHVI V. UNION OF INDIA (289 CTR 0602) AND THE DECISION OF ITA NO. 104. 206&207 / R AN /201 9 3 AMRITSAR BENCH OF THE TRIBUNAL IN THE CASE OF SIBIA HEALTHCARE PVT. LTD. VS. DCIT(TDS), [2015] 171 TTJ 0145(ASR) AND SUBMITTED THAT THE LEVY OF FEES U/S.234E OF THE ACT IS NOT SUSTAINABLE. 6. ON CONTRARY, LD. DR RELIED ON THE ORDERS OF LOWER AUTHORITIES. 7. I HAVE HEARD RIVAL SUBMISSIONS OF BOTH THE PARTIES AND PERUSED THE MATERIAL AVAILABLE ON THE RECORD OF THE TRIBUNAL ALONG WITH THE JUDICIAL PRONOUN CEMENT PLACED BY THE LD. AR OF THE ASSESSEE. I FIND THAT IN ALL THE THREE CASES LATE FEES FOR FILING THE STATEMENT HAS BEEN LEVIED U/S.234E OF THE ACT BY THE TAX AUTHORITIES. HOWEVER, IN RESPECT OF TDS STATEMENT FILED FOR A PERIOD PRIOR TO 01.06.2015, NO L ATE FEE COULD BE LEVIED IN THE INTIMATION ISSUED U/S.200A OF THE ACT. I AM ALSO IN AGREEMENT WITH THE CONTENTION OF THE LD. AR THAT THE AMENDMENT BROUGHT IN THE FINANCE ACT 2015 W.E.F.01.06.2015 IN SECTION 200A OF THE INCOME TAX ACT, 1961 IS PROSPECTIVE IN NATURE, THEREFORE, NO COMPUTATION OF LATE FEE OR DEMAND OR INTIMATION U/S.234E OF THE ACT COULD BE MADE FOR TDS DEDUCTED IN RESPECTIVE STATEMENTS PRIOR TO 01.06.2015 AND PROCESSED U/S.200A OF THE ACT. I HAVE ALSO GONE THROUGH THE DECISION OF COORDINATE BE NCH OF THE TRIBUNAL PLACED BY THE LD. AR OF THE ASSESSEE IN THE CASE OF STATE BANK OF INDIA, GWALIOR VS. CIT(A), ITA NO.442/AG/2018, ORDER DATED 09.04.2018, WHEREIN THE TRIBUNAL IN PARA 13 HAS HELD AS UNDER : - 8. HEARD THE RIVAL CONTENTION AND PERUSED THE MATERIAL RELEVANT. WE FIND THAT WHILE DECIDING THE ISSUE AGAINST THE APPELLANT ASSESSEE THE LD. CIT(A) HAS PLACED RELIANCE ON ' RAJESH KAURANI VS. UNION OF INDIA ', 83 TAXMANN.COM 137 (GUJ.) WHEREIN IT WAS HELD THAT SECTION 200A OF THE ACT IS A MACHINERY PROVISION PROVIDING THE MECHANISM FOR PROCESSING A TDS STATEMENT OF DEDUCTION OF TAX AT SOURCE AND FOR MAKING ADJUSTMENT. THE LD. CIT(A) HAS FURTHER HELD THAT THIS DECISION WAS DELIVERED AFTER CONSIDERING NUMEROUS ITAT AND HIGH COURT ITA NO. 104. 206&207 / R AN /201 9 4 DECISIONS AND THEREFORE THIS DECISION IN 'RAJESH KAURANI' (SUPRA), HOLDS THE FIELDS. 9. IT IS SEEN THAT PRIOR 01.06.2015, THERE WAS NO ENABLING PROVISION IN THE ACT U/S 200A FOR RAISING DEMAND IN RESPECT OF LEVY OF FEE U/S 234E OF THE ACT. THE PROVISION OF SECTION 234E OF THE ACT IS CHARGING PROVISION I.E. SUBSTANTIVE PROVISION WHICH COULD NOT BE APPLIED RETROSPECTIVEL Y, UNLESS IT IS EXPRESSLY PROVIDED IN THE ACT, TO LEVY THE LATE FEE FOR ANY DELAY IN FILING THE TDS STATEMENT FOR THE PERIOD PRIOR TO 01.06.2015. THE COUNSEL FOR THE ASSESSEE HAS RIGHTLY CONTENDED THAT IN THE ABSENCE OF ENABLING PROVISIONS U/S 200 A OF THE ACT , SUCH LEVY OF LATE FEE IS NOT VALID RELYING ON GROUP OF SBI AND ORS. T HE DECISIONS IN THE CASES OF ' CIT VS. VATIKA TOWNSHIP PVT. LTD . (2014) 3 67 ITR 466 ( SC), 'SUDARSHAN GOYAL VS DCIT (TDS)' ITA NO .442/AGR/2017 AND FATEHRAJ SINGHVI VS. UOI (2016) 289 CTR 0602 (KARN) (HC). THE DECISIONS RELIED ON BY THE LD. DR ARE DISTINGUISHABLE ON FACTS, AS THE ISSUE INVOLVED IN THOSE CASES PERTAINS TO INTEREST U/S 201(1) AND 201(1A) ON THE AMOUNT OF TDS WHEREAS IN THE PRESENT CASES THE ISSUE WERE PERTAINS TO LIABILITY OF LATE FEE U/S 234E OF THE ACT FOR DELAY IN FILING TDS STATEMENT WHICH WAS INSERTED FROM 01.06.2015. 10. ON SIMILAR FACTS, WE HAVE DECIDED THE SAME ISSUE IN THE ASSESSEE'S OWN CASE ' SUDERSHAN GOYAL VS. DCIT (TDS )', IN ITA NO. 442/AGRA/2017 DTD. 09.04.2018 AUTHORED BY ONE OF US (THE LD. J.M .). THE RELEVANT PART OF THE ORDER IS REPRODUCED AS FOLLOWS: '3. HEARD. THE LD. CIT(A), WHILE DECIDING THE MATTER AGAINST THE ASSESSEE, HAS PLACED RELIANCE ON ' RAJESH KAURANI VS. UOI ', 83 TAXMANN.COM 137 (GUJ), WHEREIN, IT HAS BEEN HELD THAT SECTION 200A OF THE ACT IS A MACHINERY PROVISION PROVIDING THE MECHANISM FOR PROCESSING A STATEMENT OF DEDUCTION OF TAX AT SOURCE AND FOR MAKING ADJUSTMENTS. THE LD. CIT(A) HAS HELD THAT THIS DECISION WAS DELIVERED AFTER CONSIDERING NUMEROUS ITAT/HIGH COURT DECISIONS AND SO, THIS DECISION IN 'RAJESH KAURANI' (SUPRA) HOLDS THE FIELD. 4. WE DO NOT FIND THE VIEW TAKEN BY THE LD. CIT(A) TO BE CORRECT IN LAW. AS AGAINST 'RAJESH KAURANI' (SUPRA), 'SHRI GROUP OF SBI AND O RS. FATEHRAJ SINGHVI AND OTHERS VS.UOI ', 73 TAXMANN.COM 252 (KER), AS ALSO ADMITTED BY THE LD. CIT(A) HIMSELF, DECIDES THE ISSUE IN FAVOUR OF THE ASSESSEE. THE ONLY OBJECTION OF THE LD. CIT(A) IS THAT TH IS DECISION AND OTHERS TO THE SAME EFFECT HAVE BEEN TAKEN INTO CONSIDERATION BY THE HON'BLE GUJARAT HIGH COURT WHILE PASSING 'RAJESH KAURANI' (SUPRA). HOWEVER, WHILE OBSERVING SO, THE LD. CIT(A) HAS FAILED TO TAKE INTO CONSIDERATION THE SETTLED LAW THAT WH ERE THERE IS A CLEAVAGE OF OPINION BETWEEN DIFFERENT HIGH COURTS ON AN ISSUE, THE ONE IN FAVOUR OF THE ASSESSEE NEEDS TO BE FOLLOWED. IT HAS SO BEEN HELD BY THE HON'BLE SUPREME COURT IN ' CIT VS. VEGETABLE PRODUCTS LTD .', 88 ITR 192 (SC). IT IS ALSO NOT A CASE WHERE THE DECISION AGAINST THE ASSESSEE HAS BEEN RENDERED BY THE JURISDICTIONAL HIGH COURT QUA THE ASSESSEE. 5. IN 'SHRI FATEHRAJ SINGHVI AND OTHERS' (SUPRA) IT HAS BEEN HELD, INTER ALIA, AS FOLLOWS: ITA NO. 104. 206&207 / R AN /201 9 5 '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 RETRO SPECTIVE EFFECT. UNDER THE CIRCUMSTANCES, WE FIND THAT SUBSTITUTION MADE BY CLAUSE (C) TO (F) 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 CLEA R THAT, IF ANY DEDUCTOR HAS ALREADY PAID THE FEE AFTER INTIMATION RECEIVED UNDER SECTION 200A, THE AFORESAID VIEW WILL NOT PERMIT THE GROUP OF SBI AND ORS. D EDUCTOR TO REOPEN THE SAID QUESTION UNLESS HE HAS MADE PAYMENT UNDER PROTEST.' 6. IN VIEW OF THE A BOVE, RESPECTFULLY FOLLOWING 'SHRI FATEHRAJ SINGHVI AND OTHERS' (SUPRA), 'SIBIA HEALTHCARE PVT. LTD. VS. DCIT (TDS)', ORDER DATED 09.06.2015 PASSED IN ITA NO.90/ASR/2015, FOR A.Y.2013 - 14, BY THE AMRITSAR BENCH OF THE TRIBUNAL, AND 'SHRI KAUR CHAND JAIN VS. DCIT, CPC (TDS) GHAZIABAD', ORDER DATED 15.09.2016, IN ITA NO.378/ASR/2015, FOR A.Y. 2012 - 13, THE GRIEVANCE OF THE ASSESSEE IS ACCEPTED AS JUSTIFIED. THE ORDER UNDER APPEAL IS REVERSED. THE LEVY OF THE FEE IS CANCELLED.' 11. IN THE ABOVE VIEW, RESPECTFULL Y FOLLOWING 'SHRI FATEHRAJ SINGHVI AND ORS' (SUPRA), 'SIBIA HEALTHCARE PVT. LTD. VS. DCIT (SUPRA), 'SHRI KAUR CHAND JAIN VS. DCIT', (SUPRA), AND OUR OWN FINDING IN THE CASE OF 'SUDERSHAN GOYAL' (SUPRA), WE ACCEPT THE GRIEVANCE OF THE ASSESSEES AS GENUINE. ACCORDINGLY, THE ORDERS OF THE CIT(A) ARE REVERSED AND THE FEE SO LEVIED UNDER SECTION 234E OF THE ACT IS CANCELLED. 8. I TAKE NOTE THAT THE FACTS OF THE AFORESAID CASE AND THE FACTS BEFORE ME ARE SIMI LAR. ONLY AFTER 01.06.2015, THE AO CAN LEVY FEE UNDER SECTION 234E OF THE ACT WHILE PROCESSING THE STATEMENT UNDER SECTION 200A OF THE ACT AND NOT B EFORE. THIS VIEW IS ALSO SUPPORTED BY THE DECISION OF HON'BLE KARNATAKA HIGH COURT IN THE CASE OF FATEHRAJ SINGHVI V. UNION OF INDIA (289 CTR 0602) ,WHEREIN THE HONBLE HIGH COURT AT PARA 27 HAS HELD AS UNDER : - 27. IN VIEW OF THE AFORESAID OBSERVATIONS AN D DISCUSSION, THE IMPUGNED NOTICES UNDER SECTION 200A OF THE ACT FOR COMPUTATION AND ITA NO. 104. 206&207 / R AN /201 9 6 INTIMATION FOR PAYMENT OF FEE UNDER SECTION 234E AS THEY RELATE TO FOR THE PERIOD OF THE TAX DEDUCTED PRIOR TO 1.6.2015 ARE SET ASIDE. IT IS CLARIFIED THAT THE PRESENT JUD GMENT WOULD NOT BE INTERPRETED TO MEAN THAT EVEN IF THE PAYMENT OF THE FEES UNDER SECTION 234E ALREADY MADE AS PER DEMAND/INTIMATION UNDER SECTION 200A OF THE ACT FOR THE TDS FOR THE PERIOD PRIOR TO 01.04.2015 IS PERMITTED TO BE REOPENED FOR CLAIMING REFUN D. THE JUDGMENT WILL HAVE PROSPECTIVE EFFECT ACCORDINGLY. IT IS FURTHER OBSERVED THAT THE QUESTION OF CONSTITUTIONAL VALIDITY OF SECTION 234E SHALL REMAIN OPEN TO BE CONSIDERED BY THE DIVISION BENCH AND SHALL NOT GET CONCLUDED BY THE ORDER OF THE LEARNED S INGLE JUDGE. RESPECTFULLY, FOLLOWING THE ABOVE JUDICIAL PRONOUNCEMENTS , THE IMPUGNED INTIMATION OF THE LOWER AUTHORITIES LEVYING FEE UNDER SECTION 234E OF THE ACT CANNOT BE SUSTAINED IN LAW. ACCORDING LY THE INTIMATION UNDER SECTION 200A OF THE ACT AS CONFIRMED BY THE LD. CIT(A) IN SO FAR AS LEVY OF FEE UNDER SECTION 234E OF THE ACT IS SET ASIDE A ND FEE LEVIED U/S 243E OF THE ACT IN ALL THE THREE APPEALS UNDER CONSIDERATION, ARE ORDERED TO BE DELETED. HOWEVER, THE OTHER ADJUSTMENTS MADE BY THE AO IN THE IMPUGNED INTIMATION SHALL STAND AS SUCH. I ORDER ACCORDINGLY. 9 . IN THE RESULT, ALL THE APPEAL S OF THE ASSESSEE ARE ALLOWED . O RDER PRONOUNCED IN THE OPEN COURT ON 21 / 05 / 201 9 . SD/ - ( CHANDRA MOHAN GARG ) / JUDICIAL MEMBER RANCHI ; DATED 2 1 / 05 /201 9 PRAKASH KUMAR MISHRA , S R.P.S. / COP Y OF THE ORDER FORWARDED TO : 1. / THE APPELLANT - . RISHIRAJ HOMES PRIVATE LIMITED CONTRACTORS AREA, BISTUPUR, JAMSHEDPUR, C/O: CA JAGDISH KHANDELWAL, 402&403, A.J.TOWER, Q. ROAD, BISTUPUR, JAMSHEDPUR - 831001 2. / THE RESPONDENT - IT O(TDS), JAMSHEDPUR ITA NO. 104. 206&207 / R AN /201 9 7 / BY ORDER, ( SENIOR PRIVATE SECRETARY ) , / ITAT, RANCHI 3. ( ) / THE CIT(A), 4. / CIT 5. , , / DR, ITAT, RANCHI 6. / GUARD FILE. //TRUE COPY//