M/s. IIHT Technologies Private Limited, Bangalore V. Assistant Commissioner Of Income Tax, CPC- TDS, Ghaziabad

ITA 244/BANG/2020

• Counselvise Citation: [2020] 110 COUNSELVISE.COM (IT) 6825 (ITAT-BANGALORE)
• Duration Of Justice: 6 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-09-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 10-09-2020
• Assessment Year: 2013-2014
• Appeal Filed On: 24-02-2020
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R PREMI J BENGALURU
• Keywords: Condonation of delay; TDS
• Section: 234E; 200A; 201; 251; 73

Judgement Text

ITA NO. 2661 TO 2664/BANG/2019 & ITA NO.240 TO 254/ BANG/2020 IIHT TECHNOLOGIES PVT.LTD. 1 IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH : BANGALORE BEFORE SHRI N.V. VASUDEVAN, VICE PRESIDENT AND SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER SL. NO. ITA / CO NO. A.Y. PERIOD AMOUNT 1. 2661/BANG/2019 2013-14 Q2 RS.32,2 00 FORM 24Q 2. 2662/BANG/2019 2014-15 Q1 RS.19,8 00 FORM 24Q 3. 2663/BANG/2019 2015-16 Q1-4 RS.2,15,956 FORM 24 &26Q4 4. 2664/BANG/2019 2016-17 Q1 RS.64,4 09 FORM 24Q 5. 240/BANG/2020 2013-14 Q3 RS.2100 0 FORM24Q 6. 241/BANG/2020 2013-14 Q4 RS.13,80 0 FORM24Q 7. 242/BANG/2020 2013-14 Q2 RS.32,20 0 FORM26Q 8. 243/BANG/2020 2013-14 Q3 RS.10,62 4 FORM26Q 9. 244/BANG/2020 2013-14 Q4 RS.13,80 0 FORM26Q 10. 245/BANG/2020 2013-14 Q4 RS.13,80 0 FORM27Q 11. 246/BANG/2020 2014-15 Q2 RS.9,80 0 FORM24Q 12. 247/BANG/2020 2014-15 Q3 RS.12,40 0 FORM24Q 13. 248/BANG/2020 2014-15 Q1 RS.1135 FORM26Q 14. 249/BANG/2020 2014-15 Q2 RS.9,439 FORM26Q 15. 250/BANG/2020 2014-15 Q3 RS.12,40 0 FORM26Q 16. 251 /BANG/20 20 201 5 - 1 6 Q2 RS.64,800 ITA NO. 2661 TO 2664/BANG/2019 & ITA NO.240 TO 254/ BANG/2020 IIHT TECHNOLOGIES PVT.LTD. 2 FORM24Q 17. 252/BANG/2020 2015-16 Q3 RS.46,400 FORM24Q 18. 253/BANG/2020 2015-16 Q4 RS.22,400 FORM24Q 19. 254/BANG/2020 2015-16 Q4 RS. 7036 FORM26Q M/S. IIHT TECHNOLOGIES PRIVATE LIMITED, NO.63, 1 ST FLOOR, INFANTARY ROAD, BENGALURU 560 001. PAN: AACCI 0957M TAN: BLR104856F VS. THE ASSISTANT COMMISSIONER OF INCOME TAX, CENTRALISED PROCESSING CELL- TDS TDS CPC, AAYAKAR BHAWAN, SECTOR-3, VAISHALI, GHAZIABAD, UTTRA PRADESH- 201010 APPELLANT RESPONDENT APPELLANT BY : NONE RESPONDENT BY : SMT.R.PREMI , JCIT(DR)(ITAT), BENGALURU. DATE OF HEARING : 10 - 09 - 2020 DATE OF PRONOUNCEMENT : 10 - 0 9 - 20 20 O R D E R PER BENCH THESE ARE A BATCH OF 19 APPEALS FILED BY ASSESSEE AGAINST DIFFERENT ORDERS ALL DATED 30.10.2019 OF CIT(APPEALS)-9, BANGALORE RELATING TO ASSESSMENT YEARS 2013-14 TO 2016- 17. 2. THE ASSESSEE FILED STATEMENT OF TAX DEDUCTED A T SOURCE (TDS) FOR VARIOUS QUARTERS IN FORM NO.24Q/26Q/27Q FOR FY 2012-13 TO 2015-16 (A Y 2013-14 TO 2016-17). THE STATEMENT WAS PROCESSED BY THE RESPONDENT. THERE W AS A DELAY IN FILING THE ABOVE TDS STATEMENT AND THEREFORE THE AO BY INTIMATION U/S. 2 00A OF THE INCOME-TAX ACT, 1961 [THE ACT] LEVIED LATE FEE U/S. 234E OF THE INCOME -TAX ACT, 1961 [THE ACT]. UNDER SEC.234E OF THE ACT, IF THERE IS A DELAY IN FILING STATEMENT OF TDS WITHIN THE PRESCRIBED ITA NO. 2661 TO 2664/BANG/2019 & ITA NO.240 TO 254/ BANG/2020 IIHT TECHNOLOGIES PVT.LTD. 3 TIME THEN THE PERSON RESPONSIBLE FOR MAKING PAYMENT AND FILING RETURN OF TDS IS LIABLE TO PAY BY WAY OF FEE A SUM OF RS.200/- PER DAY DURING WHICH THE FAILURE CONTINUES. SECTION 234E OF THE ACT INSERTED BY THE FINANCE ACT, 2012 W .E.F. 1.7.2012. READS AS FOLLOWS:- FEE FOR DEFAULT IN FURNISHING STATEMENTS. 234E. (1) WITHOUT PREJUDICE TO THE PROVISIONS OF TH E ACT, WHERE A PERSON FAILS TO DELIVER OR CAUSE TO BE DELIVERED A STATEMENT WIT HIN 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 O F 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 CAS E MAY BE. (3) THE AMOUNT OF FEE REFERRED TO IN SUB-SECTION (1 ) SHALL BE PAID BEFORE DELIVERING OR CAUSING TO BE DELIVERED A STATEMENT I N ACCORDANCE WITH SUB- SECTION (3) OF SECTION 200 OR THE PROVISO TO SUB-SE CTION (3) OF SECTION 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 DELIV ERED FOR TAX DEDUCTED AT SOURCE OR TAX COLLECTED AT SOURCE, AS THE CASE MAY BE, ON OR AFTER THE 1ST DAY OF JULY, 2012. 3. AGGRIEVED BY THE AFORESAID ORDERS, THE ASSESSE E FILED APPEALS BEFORE THE CIT(A). THE ASSESSEES CONTENTION BEFORE CIT(A) WAS THAT TH E PROVISIONS OF SECTION 234E OF THE ACT WAS INSERTED BY THE FINANCE ACT, 2012 W.E.F. 1 .7.2012. SECTION 200A OF THE ACT IS A PROVISION WHICH DEALS WITH HOW A RETURN OF TDS FILE D U/S.200(3) OF THE ACT HAS TO BE PROCESSED AND IT READS AS FOLLOWS:- PROCESSING OF STATEMENTS OF TAX DEDUCTED AT SOURCE . 200A. (1) WHERE A STATEMENT OF TAX DEDUCTION AT SOURCE O R A CORRECTION STATEMENT HAS BEEN MADE BY A PERSON DEDUCTING ANY SUM (HEREAF TER REFERRED TO IN THIS SECTION AS DEDUCTOR) UNDER SECTION 200, SUCH STATEMENT SHAL L BE PROCESSED IN THE FOLLOWING MANNER, NAMELY: ITA NO. 2661 TO 2664/BANG/2019 & ITA NO.240 TO 254/ BANG/2020 IIHT TECHNOLOGIES PVT.LTD. 4 ( 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 INFORMATION 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 ACCORDANCE 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 THE AMOUNT COMPUTED UNDER CLAUSE ( B ) AND CLAUSE ( C ) AGAINST ANY AMOUNT PAID UNDER SECTION 200 OR SECT ION 201 OR SECTION 234E AND ANY AMOUNT PAID OTHERWISE BY WAY OF TAX OR INTEREST OR FEE; ( 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: PROVIDED THAT NO INTIMATION UNDER THIS SUB-SECTION SHALL BE SENT AFTER THE EXPIRY OF ONE YEAR FROM THE END OF THE FINANCIAL YEAR IN WHIC H THE STATEMENT IS FILED. EXPLANATION. FOR THE PURPOSES OF THIS SUB-SECTION, 'AN INCORRE CT CLAIM APPARENT FROM ANY INFORMATION IN THE STATEMENT' SHALL MEAN A CLAIM, ON THE BASIS OF AN ENTRY, IN THE STATEMENT ( I ) OF AN ITEM, WHICH IS INCONSISTENT WITH ANOTHER ENTRY OF THE SAME OR SOME OTHER ITEM IN SUCH STATEMENT; ( II ) IN RESPECT OF RATE OF DEDUCTION OF TAX AT SOURCE , WHERE SUCH RATE IS NOT IN ACCORDANCE WITH THE PROVISIONS OF THIS ACT. (2) FOR THE PURPOSES OF PROCESSING OF STATEMENTS UN DER SUB-SECTION (1), THE BOARD MAY MAKE A SCHEME FOR CENTRALISED PROCESSING OF STA TEMENTS OF TAX DEDUCTED AT SOURCE TO EXPEDITIOUSLY DETERMINE THE TAX PAYABLE B Y, OR THE REFUND DUE TO, THE DEDUCTOR AS REQUIRED UNDER THE SAID SUB-SECTION. 4. CLAUSE (C) TO (F) OF SECTION 200A(1) WAS SUBS TITUTED BY THE FINANCE ACT, 2015 W.E.F. 1.6.2015. THE ASSESSEE CONTENDED THAT AO C OULD LEVY FEE U/S.234E OF THE ACT ITA NO. 2661 TO 2664/BANG/2019 & ITA NO.240 TO 254/ BANG/2020 IIHT TECHNOLOGIES PVT.LTD. 5 WHILE PROCESSING A RETURN OF TDS FILED U/S.200(3) O F THE ACT ONLY BY VIRTUE OF THE PROVISIONS OF SEC.200A(1)(C), (D) & (F) OF THE ACT AND THOSE PROVISIONS CAME INTO FORCE ONLY FROM 1.6.2015 AND THEREFORE THE AUTHORITY ISSU ING INTIMATION U/S. 200A OF THE ACT WHILE PROCESSING RETURN OF TDS FILED U/S.200(3) OF THE ACT, COULD NOT LEVY FEE U/S. 234E OF THE ACT IN RESPECT OF STATEMENT OF TDS FILED PRI OR TO 1.6.2015. THE ASSESSEE, THUS, CHALLENGED THE VALIDITY OF CHARGING OF FEE U/S. 234 E OF THE ACT. THE ASSESSEE RELIED ON THE DECISION OF THE HONBLE HIGH COURT OF KARNATAKA IN THE CASE OF FATEHRAJ SINGHVI V. UOI [2016] 73 TAXMANN.COM 252 WHEREIN THE HONBLE KARNATAKA HIGH COURT HELD THAT AMENDMENT MADE U/S. 200A PROVIDING THAT FEE U/S. 23 4E OF THE ACT COULD BE COMPUTED AT THE TIME OF PROCESSING OF RETURN AND ISSUE OF INTIM ATION HAS COME INTO EFFECT ONLY FROM 1.6.2015 AND HAD ONLY PROSPECTIVE EFFECT AND THEREF ORE, NO COMPUTATION OF FEE U/S.234E OF THE ACT FOR DELAYED FILING OF RETURN OF TDS WHIL E PROCESSING A RETURN OF TDS U/S.234E OF THE ACT COULD HAVE BEEN MADE FOR TAX DEDUCTED AT SOURCE FOR THE ASSESSMENT YEARS PRIOR TO 1.6.2015. 5. THE CIT(APPEALS) FOUND THAT THE APPEALS WERE FILED BY THE ASSESSEE ON 5.3.2019 AND WERE FILED BELATED AND THERE WAS APPLICATION FO R CONDONATION OF DELAY IN FILING THE APPEALS. THE ASSESSEE CLAIMED BEFORE CIT(A) THAT T HE CONTROVERSY REGARDING LEVY OF INTEREST U/S.234-E OF THE ACT WAS NOT CLEAR AND CLA RITY EMERGED ONLY AFTER THE DECISION OF THE HONBLE HIGH COURT OF KARNATAKA IN THE CASE OF FATHERAJ SINGHVI (SUPRA) AND THAT THE ASSESSEES BUSINESS WAS FACING FINANCIAL STRAIN AND HENCE LOST TRACK OF THE CASE. THE CIT(A) FOUND THAT THERE WAS INORDINATE DELAY IN FIL ING THE APPEALS AND THOSE DETAILS HAVE BEEN SET OUT IN THE ORDER OF CIT(A) FOR EACH OF THE APPEALS SET OUT IN THE CAUSE TITLE OF THIS ORDER. 6. THE CIT(A) REFUSED TO CONDONE THE DELAY IN FILI NG APPEALS AND DISMISSED ALL THE APPEALS (EXCEPT APPEALS FOR AY 2015-16 & 2016-17) O BSERVING THAT THE ASSESSEE HAS NOT BROUGHT SUFFICIENT CAUSE FOR DELAY. AS FAR AS APPEA LS FOR AY 2015-16 & 2016-17 IS CONCERNED, THE CIT(A) NOTICED THAT THERE WAS A DELA Y IN FILING APPEALS FOR THESE YEARS ALSO ITA NO. 2661 TO 2664/BANG/2019 & ITA NO.240 TO 254/ BANG/2020 IIHT TECHNOLOGIES PVT.LTD. 6 AND REFUSED TO CONDONE THE DELAY IN FILING THE APPE ALS. THE CIT(A) DID NOT STOP WITH THIS HE FURTHER WENT ON TO HOLD THAT THE TDS STATEMENTS WERE FILED BY THE ASSESSEE FOR THESE AYS AFTER 1.6.2015 AND AFTER 1.6.2015 THE LAW WAS A MENDED AND THE DEFECT POINTED OUT BY THE HONBLE KARNATAKA HIGH COURT IN THE CASE OF FAT EERAJ SINGHVI (SUPRA) DID NOT EXIST AND THE LEVY WAS VALID. IT HAS TO BE CLARIFIED HER E THAT THOUGH THE STATEMENTS OF TDS WERE FILED AFTER 1.6.2015, THEY RELATED TO PERIOD PRIOR TO 1.6.2015 AND THE RATIO LAID DOWN IN THE DECISION OF HONBLE KARNATAKA HIGH COURT IN THE CA SE OF FATEERAJ SINGHVI (SUPRA) WILL APPLY. THE DECISION OF CIT(A) TO THE CONTRARY IS N OT CORRECT. 9. NONE APPEARED FOR THE ASSESSEE. THE LEARNED DR REITERATED THE STAND OF THE REVENUE AS REFLECTED IN THE ORDER OF THE CIT(A). 10. WE HAVE CONSIDERED THE SUBMISSIONS OF THE LE ARNED DR AND ALSO THE GROUNDS OF APPEAL FILED BY THE ASSESSEE. IT IS NOT IN DISPUTE THAT IF THE RATIO LAID DOWN BY THE HONBLE KARNATAKA HIGH COURT IN THE CASE OF FATEERAJ SINGHVI (SUPRA) IS APPLIED THEN THE LEVY OF INTEREST U/S.234-E OF THE ACT WOULD BE ILLEGAL FOR RETURNS OF TDS IN RESPECT OF THE PERIOD PRIOR TO 1.6.2015. THE PRESENT APPEALS OF THE ASSE SSEE RELATE TO TDS RETURNS FILED PRIOR TO 1.6.2015. THE DECISION OF THE HONBLE KARNATAKA HIGH COURT IN THE CASE OF FATEERAJ SINGHVI (SUPRA) WAS RENDERED ON 26.8.2016. IT HAS BEEN HELD BY THE ITAT HYDERABAD BENCH IN THE CASE OF MSV IT SOLUTIONS LTD. VS. ITO, WARD 16(4) ITA NOS. 177 & 178/HYD/2018 ORDER DATED 26.10.2018 WHEREIN ON IDEN TICAL FACTS NOTICING THAT THERE WAS NO LEGAL REMEDY PRIOR TO 1.6.2015 AGAINST AN INTIMA TION U/S.200A OF THE ACT, THE HYDERABAD BENCH CONDONED DELAY IN FILING APPEAL BEF ORE CIT(A). 11. CONSIDERING THE PECULIAR FACTS AND CIRCUMSTAN CES OF THE CASE AND KEEPING IN MIND THAT TECHNICALITIES SHOULD NOT STAND IN THE WAY OF RENDERING SUBSTANTIVE JUSTICE, WE ARE OF THE VIEW THAT INTEREST OF JUSTICE WOULD BE MET IF T HE DELAY IN FILING APPEALS BY THE ASSESSEE BEFORE CIT(A) IS CONDONED AND THE ISSUE WI TH REGARD TO LEVY OF INTEREST U/S.234- E OF THE ACT BE REMANDED TO THE CIT(A) FOR FRESH CO NSIDERATION IN ACCORDANCE WITH THE OBSERVATIONS MADE IN THIS ORDER. WE HOLD AND DIREC T ACCORDINGLY. ITA NO. 2661 TO 2664/BANG/2019 & ITA NO.240 TO 254/ BANG/2020 IIHT TECHNOLOGIES PVT.LTD. 7 12. IN THE RESULT, ALL THE APPEALS BY THE ASSESSE ES ARE TREATED AS ALLOWED FOR STATISTICAL PURPOSE. PRONOUNCED IN THE OPEN COURT ON THIS 10 TH DAY OF SEPTEMBER, 2020. SD/- SD/- ( CHANDRA POOJARI ) ( N V VASUDEVAN ) ACCOUNTANT MEMBER VICE PRESIDENT BANGALORE, DATED, THE 10 TH SEPTEMBER, 2020. / DESAI S MURTHY / COPY TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR, ITAT, BANGALORE. 6. GUARD FILE BY ORDER ASSISTANT REGISTRAR ITAT, BANGALORE.