Principal Rajiv Gandhi Govt. Ayurvedic College , Paprola V. ACIT, CPC, TDS, Ghaziabad (ITO, TDS), Palampur

ITA 1663/CHANDI/2017

• Counselvise Citation: [2018] 121 COUNSELVISE.COM (IT) 5020 (ITAT-CHANDIGARH)
• Duration Of Justice: 7 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-05-2018
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2016-2017
• Appeal Filed On: 10-10-2017
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Principle of natural justice; Reasonable cause; TDS
• Section: 234E; 200A; 201; 142(2A)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DIVISION BENCHB, CHANDIGARH BEFORE SMT. DIVA SINGH, JUDICIAL MEMBER AND MS. ANNAPURNA GUPTA, ACCOUNTANT MEMBER ITA NO.1463 & 1663/CHD/2017 ASSESSMENT YEAR: 2016-17 PRINCIPAL RAJIV GANDHI GOVT. VS. THE ACIT AYURVEDIC COLLEGE, PAPROLA CPC, TDS KANGRA GHAZIABAD (ITO, TDS) PALAMPUR PAN NO. PTLR11800F (APPELLANT) (RESPONDENT) ASSESSEE BY : SH. S.S. GULERIA REVENUE BY : SH. MANJIT SINGH DATE OF HEARING : 21/02/2018 DATE OF PRONOUNCEMENT : 11/05/2018 ORDER PER ANNAPURNA GUPTA, A.M. BOTH THE ABOVE APPEALS HAVE BEEN FILED BY THE ASSES SEE AGAINST SEPARATE ORDERS PASSED, IN APPEAL AGAINST INTIMATI ONS MADE U/S 200A OF THE INCOME TAX ACT,1961 (HEREINAFTER REFERRED TO AS AC T), BY THE LD. CIT(A), PALAMPUR(H.P.) 2. THE ISSUE RAISED IN BOTH THE ABOVE APPEALS ARE C OMMON, RELATING TO CHARGING OF FEES UNDER SECTION 234E OF THE ACT ON A CCOUNT OF LATE FILING OF TDS RETURNS . THEREFORE BOTH THE APPEALS WERE HEARD TOG ETHER AND ARE BEING DISPOSED OFF BY WAY OF THIS COMMON ORDER. 3. FOR THE SAKE OF CONVENIENCE WE SHALL BE DEALING WITH THE APPEAL OF THE ASSESSEE IN ITA NO. 1463/CHD/2017. THE GROUND RAISE D BY THE ASSESSEE READS AS UNDER: 1. THAT THE ORDER OF THE LD. CIT(A) IS AGAINST THE FACTS AND LAW UPHOLDI NG THE CHARGING OF THE FEE OF RS. 63600/- CHARGED U/SEC 234 E. 2. THAT THE TAX HAS BEEN DEDUCTED AND DEPOSITED IN TO THE CENTRAL GOVERNMENT ACCOUNT WELL IN TIME AND THERE IS NO LOSS OF REVENUE. 2 3. THAT THE RETURN WAS HANDED OVER TO THE FRANCHISE WE LL IN TIME AND THE DELAY IF ANY ,OCCURRED ON THEIR PART. 4. THAT THE APPELLANT MAY NOT BE PENALIZED FOR FAILURE ON THE PART OF FRANCHISETO WHOM THE STATEMENTS WERE HANDED OVER WELL IN TIME . 5. THAT THE DEFAULT IS PURELY VENIAL AND TECHNICAL IN NATURE. 6. THAT THE LD. AO DID NOT AFFORD AN OPPORTUNITY OF BE ING HEARD AND THUS THE FEE CHARGED IS VIOLATION OF THE PRINCIPLES OF NATURAL J USTICE . 7. THAT THE APPELLANT WAS NOT AWARE OF THE AMENDED PROVISIONS OF SECTION 200 A OF THE INCOME TAX ACT 1961 WHICH COME IN TO E FFECT FROM 01-06-2015 4. BRIEFLY STATED THE TDS STATEMENT FOR F.Y. 2015-1 6,Q1, FORM NO. 24Q FILED BY THE ASSESSEE ON 13/06/2016 WAS PROCESSED UNDER SECT ION 200A OF THE INCOME TAX ACT, 1961 AND ADJUSTMENT MADE ON ACCOUNT OF FE ES FOR LATE FLING OF THE SAID RETURNS, AS PER THE PROVISIONS OF SECTION 234E OF T HE ACT, AMOUNTING TO RS. 63,600/- VIDE INTIMATION DT. 16/06/2016. 5. AGGRIEVED BY THE SAME THE ASSESSEE FILED APPEAL BEFORE THE LD. CIT(A). 6. BEFORE THE LD. CIT(A) THE ASSESSEE CONTENDED THA T THE DELAY IN THE STATEMENT OF THE TDS RETURN WAS NOT ON ACCOUNT OF A NY FAULT OF THE ASSESSEE BUT WAS ATTRIBUTABLE TO THE ADVOCATE WHO WAS ENGAGED BY THE ASSESSEE FOR FILING THE TDS RETURN,WHO FAILED TO SUBMIT THE TDS RETURN ON TIME. THE ASSESSEE FILED COPY OF THE DISPATCH REGISTER OF THE COLLEGE SHOWIN G CORRESPONDENCE WITH REGARD TO THE IMPUGNED TDS RETURN IN FORM NO. 24Q S ENT IN TIME TO THE ADVOCATE. THE ASSESSEE ALSO CONTENDED THAT THE AO D ID NOT AFFORD AN OPPORTUNITY OF HEARING BEFORE LEVYING THE LATE FEES UNDER SECTION 234E AND THUS VIOLATED THE PRINCIPLES OF NATURAL JUSTICE. THE LD. CIT(A) DISMISSED THE CONTENTION OF THE ASSESSEE AND UPHELD THE LEVY OF FEES STATING THAT THE FACT OF THERE BEING DELAY IN THE FILING OF RETURN BEING UNDISPUTED AND THE LEVY OF FEES BEING STATUTORY, MANDATORY, AND CONSEQUENTIAL, THE AO HAD RIGHTLY LEVIED THE FEES IN THE PRESENT CASE. THE RELEVANT FINDINGS OF THE LD. CIT(A) IN THIS REGARD AT PARA 5 OF HIS ORDER IS AS UNDER: 5. I HAVE CONSIDERED THE FACTS OF THE CASE AND SUBMISS IONS OF THE APPELLANT. THE PLEA OF THE APPELLANT THAT IT HAD DISPATCHED A COMM UNICATION TO THE ADVOCATE DOES NOT HELP THE CASE OF THE APPELLANT. THE DUE DA TE FOR UPLOADING THE 24Q TDS STATEMENT FOR Q-L WAS 31.07.2015 AND THE SAID COMMU NICATION IS CLAIMED TO HAVE BEEN SENT TO THE ADVOCATE ON 30.07.2015. THIS APART , THERE IS NO EVIDENCE OF ACTUAL DISPATCH BY POST OR OTHER-WISE OF THE SAID C OMMUNICATION. THE FACTS OF THE 3 CASE LAW RELIED UPON BY THE APPELLANT, I.E., SAHARA INDIA VS CIT, ARE ALSO DISTINGUISHABLE AS IN THIS CASE, HON'BLE COURT HELD THAT SPECIAL AUDIT U/S 142(2A) REQUIRES ISSUE OF SHOW-CAUSE NOTICE. IN THE PRESENT CASE, LATE FILING FEE U/S 234E FOR Q UARTER 1 OF F.Y. 2015-16, FORM 24Q, HAS BEEN LEVIED WHILE PROCESSING THE TDS STATEMENT U/S 200A OF THE ACT ON 16.6.2016. SECTION 200A OF THE ACT TITLED 'PROCESSI NG OF STATEMENTS OF TAX DEDUCTION AT SOURCE' WAS INSERTED BY FINANCE ACT, 2 009 W.E.F. 01.04.2010. SECTION 234E OF THE ACT TITLED 'FEE FOR DEFAULT IN FURNISHI NG STATEMENTS' WAS INSERTED BY THE FINANCE ACT 2012 W.E.F. 1.07.2012. CLAUSE (C) FOR C HARGING FEE U/S 234E AS PART OF THE ADJUSTMENTS HAS BEEN INSERTED IN SECTION 200A(1 ) BY FINANCE ACT 2015 W.E.F. 01-06-2015. THE LATE FILING FEE U/S 234E HAS BEEN L EVIED IN THE PRESENT CASE AFTER 1.6.2015 AND WAS VERY MUCH WITHIN THE SCOPE OF PERM ISSIBLE ADJUSTMENTS CONTEMPLATED U/S 200A. THE LEVY U/S 234E IS STATUTORY, MANDATORY AND CONSE QUENTIAL TO THE PROCESSING OF THE TDS STATEMENT U/S 200A OF THE ACT. NO OPPORTUNI TY OF HEARING IS REQUIRED TO BE GIVEN BEFORE PROCESSING OF THE E-TDS RETURN U/S 200 A OF THE I.T. ACT. THE APPELLANT HAS NOT DISPUTED THE FACT THAT THE STATEMENT HAS BE EN FILED LATE NOR CONTESTED THE PERIOD OF DELAY. UPON DUE CONSIDERATION OF THE MATTER, IT IS HELD THAT THE FEE U/S 234E HAS BEEN RIGHTLY LEVIED AND IS ACCORDINGLY UPHELD. 7. BEFORE US THE LD. COUNSEL FOR THE ASSESSEE REITE RATED THE CONTENTION MADE BEFORE THE LD. CIT(A). 8. LD. DR ON THE OTHER HAND RELIED ON THE ORDER OF THE LD. CIT(A). 9. HAVING HEARD THE CONTENTION OF BOTH THE PARTIES WE FIND NO MERIT IN THE PRESENT APPEAL. THE FACT THAT TDS RETURN WAS FILED LATE IS NOT DISPUTED. SECTION 234E WHICH CHARGES FEES FOR LATE FILING OF RETURN R EADS AS UNDER: 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 P RESCRIBED IN SUB-SECTION (3) OF SECTION 200 OR THE PROVISO TO SUB-SECTION (3) OF SE CTION 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. (2) THE AMOUNT OF FEE REFERRED TO IN SUB-SECTION (1 ) SHALL NOT EXCEED THE AMOUNT OF TAX DEDUCTIBLE OR COLLECTIBLE, AS THE CASE MAY B E. (3) THE AMOUNT OF FEE REFERRED TO IN SUB-SECTION (1 ) SHALL BE PAID BEFORE DELIVERING OR CAUSING TO BE DELIVERED A STATEMENT IN ACCORDANC E WITH SUB-SECTION (3) OF SECTION 200 OR THE PROVISO TO SUB-SECTION (3) OF SE CTION 206C. (4) THE PROVISIONS OF THIS SECTION SHALL APPLY TO A STATEMENT REFERRED TO IN SUB- SECTION (3) OF SECTION 200 OR THE PROVISO TO SUB-SE CTION (3) OF SECTION 206C WHICH IS TO BE DELIVERED OR CAUSED TO BE DELIVERED FOR TAX D EDUCTED AT SOURCE OR TAX COLLECTED AT SOURCE, AS THE CASE MAY BE, ON OR AFTE R THE 1ST DAY OF JULY, 2012.'. A BARE READING OF THE SAME REVEALS THAT IT IS A CH ARGE AND NOT A LEVY SINCE IT IS TO BE PAID SUO MOTO BY PERSONS IN DEFAULT BEFORE DELIVERING THE STATEMENT OF TDS RETURN AS PER THE PROVISIONS OF SECTION 200(3) OF THE ACT,MEANING THEREBY THAT IT IS MANDATORY.THIS IS ALSO EVIDENT FROM THE LANGUAGE OF SECTION 200A ,WHICH 4 DEALS WITH PROCESSING OF TDS RETURNS ,ALLOWING ADJ USTMENT TO BE MADE ON ACCOUNT OF FEES FOR LATE FILING OF TDS RETURNS AS P ER THE PROVISIONS OF SECTION 234E AND NOT LEVYING THE SAME. FOR A BETTER UNDERSTAND ING ,SECTION 200A IS REPRODUCED HEREUNDER: '200A. PROCESSING OF STATEMENTS OF TAX DEDUCTED AT SOURCE. (1) WHERE A STATEMENT OF TAX DEDUCTION AT SOURCE HA S BEEN MADE BY A PERSON DEDUCTING ANY SUM (HEREAFTER REFERRED TO IN THIS SE CTION AS DEDUCTOR) UNDER SECTION 200, SUCH STATEMENT SHALL BE PROCESSED IN T HE FOLLOWING MANNER, NAMELY: (A ) THE SUMS DEDUCTIBLE UNDER THIS CHAPTER SHALL BE COMPUTED AFTER MAKING THE FOLLOWING ADJUSTMENTS, NAMELY: (I) ANY ARITHMETICAL ERROR IN THE STATEMENT; OR (II) AN INCORRECT CLAIM, APPARENT FROM ANY IN FORMATION IN THE STATEMENT; (B ) THE INTEREST, IF ANY, SHALL BE COMPUTED ON THE B ASIS OF THE SUMS DEDUCTIBLE AS COMPUTED IN THE STATEMENT; (C) THE FEE, IF ANY , SHALL BE COMPUTED IN ACCORDAN CE WITH THE PROVISIONS OF SECTION 234E; (D ) THE SUM PAYABLE BY, OR THE AMOUNT OF REFUND DUE TO, THE DEDUCTOR SHALL BE DETERMINED AFTER ADJUSTMENT OF AMOUNT COMP UTED UNDER CLAUSE (B) AND CLAUSE(C) AGAINST ANY AMOUNT PAID UNDER SECTION 200 OR SECTION 201 OR SECTION 234E, AND ANY AMOUNT PAID OTHERWISE BY WAY OF TAX O R INTEREST; (E ) AN INTIMATION SHALL BE PREPARED OR GENERATED AND SENT TO THE DEDUCTOR SPECIFYING THE SUM DETERMINED TO BE PAYABLE BY, OR THE AMOUNT OF REFUND DUE TO, HIM UNDER CLAUSE (D); AND (F ) THE AMOUNT OF REFUND DUE TO THE DEDUCTOR IN PURS UANCE OF THE DETERMINATION UNDER CLAUSE (D) SHALL BE GRANTED TO THE DEDUCTOR : AS IS EVIDENT FROM A BARE READING OF THE ABOVE , U/ S 200A THE TDS RETURNS ARE ONLY PROCESSED AND CORRECTIONS/ADJUSTMENTS MADE OF APPARENT AND GLARING ERRORS ,WHETHER MATHEMATICAL ERRORS OR APPARENTLY I NCORRECT CLAIMS AND ALSO INCLUDES ADJUSTMENT ON ACCOUNT OF FEES U/S 234E. IT IS A SUMMARY SCRUTINY OF TDS RETURNS ALLOWING ONLY APPARENT ADJUSTMENTS TO BE M ADE.BY PERMITTING FEES CHARGED U/S 234E TO BE ADJUSTED ,IT IMPLIES THAT TH E SAME IS A MANDATORY CHARGE. THEREFORE NO QUESTION ARISES OF CONFRONTING THE AS SESSEE BEFORE COLLECTING THE SAID FEES OR FOR THAT MATTER NOT CHARGING IT ON REASONABLE CAUSE BEING DEMONSTRATED BY THE PERSON IN DEFAULT. BEING A CHAR GE AND NOT A LEVY THERE IS NO DISCRETION WITH THE AUTHORITY MAKING ADJUSTMENT ON ACCOUNT OF THE SAME WHILE PROCESSING THE TDS RETURN U/S 200A OF THE ACT . FURTHER THE LD. COUNSEL FOR THE ASSESSEE HAS NOT BROUGHT TO OUR NOTICE ANY PROV ISIONS UNDER THE ACT WHICH PROVIDES FOR NO FEES TO BE CHARGED IN CASE REASONAB LE CAUSE FOR DELAY IN FILING 5 THE TDS RETURN IS DEMONSTRATED BY THE ASSESSEE ON T HE LINES OF SECTION 273 B OF THE ACT WHICH SO PROVIDES IN THE CASE OF PENALTIES LEVIED. THE LD. CIT(A) THEREFORE WE HOLD HAS RIGHTLY STATE D THAT THE LEVY OF FEES IS MANDATORY, STATUTORY, AND CONSEQUENTIAL TO THE PROC ESSING OF TDS STATEMENT, THEREFORE, NO OPPORTUNITY OF HEARING IS REQUIRED TO BE GIVEN BEFORE PROCESSING OF E-TDS RETURN. IN VIEW OF THE ABOVE WE UPHOLD THE OR DER OF THE LD. CIT(A) AND DISMISS THE APPEAL FILED BY THE ASSESSEE. 10. IT WAS COMMON GROUND THAT THE FACTS AND ISSUE I N ITA NO. 1663/CHD/2017 WERE IDENTICAL TO THAT IN ITA NO. 1463/CHD/2017.THE REFORE OUR DECISION RENDERED IN ITA NO. 1463/CHD/2017 ABOVE, WILL APPLY TO THE A PPEAL OF THE ASSESSEE IN ITA NO. 1663/CHD/2017 ALSO, FOLLOWING WHICH THE APPEAL IN ITA NO. 1663/CHD/2017 IS ALSO DISMISSED. 11. IN THE RESULT, BOTH THE APPEALS OF THE ASSESSEE ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT. SD/- SD/- (DIVA SINGH) (ANNAPURNA GUPTA) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED : 11/05/2018 AG COPY TO: THE APPELLANT, THE RESPONDENT, THE CIT, TH E CIT(A), THE DR