HEMAL S. GONDALIA, MUMBAI V. DCIT CPC (TDS), GHAZIABAD

ITA 3760/MUM/2015

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 3732 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 1 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-08-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: misc
• Appeal Filed On: 18-06-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: NEIL PHILIP
• Assessee Lawyers: G C LALKA
• Section: 2

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH B, MUMBAI BEFORE SHRI R.C. SHARMA, ACCOUNTANT MEMBER AND SHRI SANDEEP GOSAIN , JUDICIAL MEMBER ITA NO. 37 6 0 /MUM/201 5 : (A.Y : 201 3 - 1 4) (24Q - 4 ) SHRI HEMAL S. GONDALIA 1403A & 1403B, 14 TH FLOOR, HIMGIRI, NEELKANTH VIHAR, SBK RAM MARG, GHATKOPAR (E), MUMBAI - 77. PAN : A EWPG7329G (APPELLANT) VS. DC IT , CPC - TDS, GHAZIABAD (RESPONDENT) ASSESSEE BY : SHRI G.C. LALKA REVENUE BY : SHRI NEIL PHILIP DATE OF HEARING : 21 /07/2016 DATE OF PRONOUNCEMENT : 12 /0 8 /2016 O R D E R PER SANDEEP GOSAIN , JM : THE PRESENT APPEAL HAS BEEN FILED BY THE ASSESSEE AGAINST THE ORDER OF COMMISSIONER OF I NCOME T AX (A PPEALS ) - 5 9 , MUMBAI (IN SHORT CIT(A)) DATED 6 . 4 .2015 FOR A.Y 201 3 - 1 4 (24Q - 4) ON THE FOLLOWING GROUND OF APPEAL : 1. THE LEARNED CIT(A) HAS ERRED IN UPHOLDING THE ORDER OF ASSESSING OFFICER (TDSCPC) IN LEVYING LATE FEE OF RS.14,200/ - U/S. 234E OF THE INCOME TAX ACT, 1961 WITHOUT CONSIDERING THE FACTS IN TOTAL. HE HAS IGNO RED THE PROVISIONS OF THE SECTION 234E, WHICH SPECIFIES THAT THE TDS RETURN HAS TO BE ACCEPTED WITH THE PAYMENT OF THE FEES. THE ADJOURNMENT LETTER FILED PRIOR TO THE DATE OF HEARING WAS IGNORED BY THE LEARNED CIT(A). 2 SHRI HEMAL S. GONDALIA ITA NO. 3760/MUM/2015 2. THE BRIEF FACTS OF THE CASE ARE THAT AN ORDER U/S 200A OF THE INCOME TAX ACT, 1961 (IN SHORT THE ACT) WAS PASSED BY ITO TDS - 1(2)(3). AGAINST THIS ORDER OF ITO, ASSESSEE PREFERRED AN APPEAL BEFORE THE CIT(A) AND THE CIT(A) DISMISSED THE APPEAL FILED BY THE ASSESSEE. AGGRIEVED BY THE O RDER OF CIT(A), ASSESSEE PREFERRED THE PRESENT APPEAL ON THE GROUND MENTIONED HEREINABOVE. 3. THE SOLE ISSUE RAISED BY THE ASSESSEE BEFORE US IS THAT CIT(A) HAS ERRED IN UPHOLDING THE ORDER OF TDS - CPC IN LEVYING LATE FEE OF RS.14,200/ - U/S 234E OF THE A CT WITHOUT CONSIDERING THE FACTS IN TOTO . THE LD. AR APPEARING ON BEHALF OF THE ASSESSEE SUBMITTED THAT THE CIT(A) AS WELL AS THE ASSESSING OFFICER HAS IGNORED THE PROVISIONS OF SEC. 234E OF THE ACT WHICH SPECIFIES THAT TDS RETURN HAS TO BE ACCEPTED WITH THE PAYMENT OF FEE. THE LD. AR ALSO RELIED UPON THE ORDERS PASSED BY THE COORDINATE BENCH OF THE TRIBUNAL IN ITA NOS. 3758, 3759, 3761 AND 3762/MUM/2015 DATED 5.7.2016 IN THE ASSESSEES OWN CASE. THE FACTS OF THE PRESENT CASE AND THE LEGAL ISSUE INVOLVED IN THE PRESENT CASE ARE IDENTICAL WITH THE CASE DECIDED BY THE COORDINATE BENCH IN THE ASSESSEES OWN CASE MENTIONED ABOVE. WE HAVE PERUSED THE ORDERS PASSED BY THE COORDINATE BENCH OF THE TRIBUNAL IN ITA NOS. 3758, 3759, 3761 AND 3762/MUM/2015 DATED 5.7 .2016 ( SUPRA) , THE RELEVANT PARAGRAPHS OF WHICH ARE REPRODUCED BELOW : - 4. AT THE TIME OF HEARING, THE LD. COUNSEL INVITED MY ATTENTION TO THE PROVISIONS OF SECTION 200A, 234E AND THE FINANCE ACT, 2015 AND SUBMITTED THAT ACCORDING TO FINANCE ACT, 2015, THE AO IS EMPOWERED TO LEVY FEE UNDER SECTION 234E W.E.F.1.6.2015 AND PRIMA FACIE, THE ASSESSMENT YEARS INVOLVED IN THESE APPEALS ARE 2006 - 07 AND 2013 - 14. 3 SHRI HEMAL S. GONDALIA ITA NO. 3760/MUM/2015 THEREFORE, THE LEVY OF FEES BY THE AO IS BAD IN LAW. THE LD.COUNSEL ALSO SUBMITTED THAT THIS ISSUE HAS ALREADY BEEN DISCUSSED ELABORATELY BY THE VARIOUS BENCHES OF TRIBUNAL AND DECIDED THE ISSUE IN FAVOUR OF THE ASSESSEE. HE ALSO SUBMITTED THAT RASHMIKANT KUNDALIA (SUPRA) IS RELEVANT ONLY TO THE PRE - AMENDMENT POSITION OF SECTION 234E OF THE ACT. IN SUPPORT OF HIS CONTENTION HE PLACED RELIANCE ON THE FOLLOWING DECISIONS: A) SIBIA HEALTHCARE PVT LTD V/S DCIT IN I.T.A. NO.90/ASR/201 5(AY - 2013 - 14) ORDER DATED 9.6.2015; AND B) SMT. G. INDHIRANI V/S DCIT IN ITA NOS.1019, 1020 & 1021/MDS/2015 (AY - 2013 - 14) ORDER DATED 10.7.2015 5. THE LD.DR DID NOT CONTROVERT THE AFORE SAID CONTENTIONS OF THE LD.COUNSEL AND HE ALSO COULD NOT BRING ANY MAT ERIAL CONTRARY TO TAKE A DIFFERENT VIEW THAN THE VIEW SO TAKEN BY THE BENCHES OF THE TRIBUNAL. HE PLACED RELIANCE ON THE IMPUGNED ORDERS. 6. I HAVE HEARD BOTH THE PARTIES AT LENGTH AND HAVE PERUSED THE MATERIAL PLACED BEFORE US INCLUDING THE ORDERS OF AU THORITIES BELOW AND CASE LAWS RELIED UPON BY RIVAL PARTIES. I FIND THAT THE ISSUE RAISED IN THESE APPEALS NOW STANDS COVERED BY THE TRIBUNAL DECISIONS AS MENTIONED ABOVE FOR THE SAKE OF CONVENIENCE I REPRODUCE HELD PORTION OF THE RESPECTIVE ORDER : IN THE CASE OF SIBIA HEALTHCARE PRIVATE LIMITED (SUPRA) THE TRIBUNAL HAS HELD AS UNDER (IN THIS DECISION, THE UNDERSIGNED IS THE CO - AUTHOR): 10. IN VIEW OF THE ABOVE DISCUSSIONS, IN OUR CONSIDERED VIEW, THE ADJUSTMENT IN RESPECT OF LEVY OF FEES UNDER SECTION 234E WAS INDEED BEYOND THE SCOPE OF PERMISSIBLE ADJUSTMENTS CONTEMPLATED UNDER SECTION 200A. THIS INTIMATION IS AN APPEALABLE ORDER UNDER SECTION 246A(A), AND, THEREFORE, THE CIT(A) OUGHT TO HAVE EXAMINED LEGALITY OF THE ADJUSTMENT MADE UNDER THIS INTIMATI ON IN THE LIGHT OF THE SCOPE OF THE SECTION 200A. LEARNED CIT(A) HAS NOT DONE SO. HE HAS JUSTIFIED THE LEVY OF FEES ON THE BASIS OF THE PROVISIONS OF SECTION 234E. THAT IS NOT THE ISSUE HERE. THE ISSUE IS WHETHER SUCH A LEVY COULD BE EFFECTED IN 4 SHRI HEMAL S. GONDALIA ITA NO. 3760/MUM/2015 THE COURSE OF INTIMATION UNDER SECTION 200A. THE ANSWER IS CLEARLY IN NEGATIVE. NO OTHER PROVISION ENABLING A DEMAND IN RESPECT OF THIS LEVY HAS BEEN POINTED OUT TO US AND IT IS THUS AN ADMITTED POSITION THAT IN THE ABSENCE OF THE ENABLING PROVISION UNDER SECTION 20 0A, NO SUCH LEVY COULD BE EFFECTED. AS INTIMATION UNDER SECTION 200A, RAISING A DEMAND OR DIRECTING A REFUND TO THE TAX DEDUCTOR, CAN ONLY BE PASSED WITHIN ONE YEAR FROM THE END OF THE FINANCIAL YEAR WITHIN WHICH THE RELATED TDS STATEMENT IS FILED, AND AS THE RELATED TDS STATEMENT WAS FILED ON 19TH FEBRUARY 2014, SUCH A LEVY COULD ONLY HAVE BEEN MADE AT BEST WITHIN 31ST MARCH 2015. THAT TIME HAS ALREADY ELAPSED AND THE DEFECT IS THUS NOT CURABLE EVEN AT THIS STAGE. IN VIEW OF THESE DISCUSSIONS, AS ALSO BEAR ING IN MIND ENTIRETY OF THE CASE, THE IMPUGNED LEVY OF FEES UNDER SECTION 234 E IS UNSUSTAINABLE IN LAW. WE, THEREFORE, UPHOLD THE GRIEVANCE OF THE ASSESSEE AND DELETE THE IMPUGNED LEVY OF FEE UNDER SECTION 234E OF THE ACT. THE ASSESSEE GETS THE RELIEF ACC ORDINGLY. IN THE CASE OF SMT. G. INDHIRANI(SUPRA) THE TRIBUNAL HAS HELD AS UNDER : 11. IN VIEW OF THE ABOVE DISCUSSION, THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THE ASSESSING OFFICER HAS EXCEEDED HIS JURISDICTION IN LEVYING FEE UNDER SECTION 234E WHILE PROCESSING THE STATEMENT AND MAKE ADJUSTMENT UNDER SECTION 200A OF THE ACT. THEREFORE, THE IMPUGNED INTIMATION OF THE LOWER AUTHORITIES LEVYING FEE UNDER SECTION 234E OF THE ACT CANNOT BE SUSTAINED IN LAW. HOWEVER, IT IS MADE CLEAR THAT IT IS OPEN T O THE ASSESSING OFFICER TO PASS A SEPARATE ORDER UNDER SECTION 234E OF THE ACT LEVYING FEE PROVIDED THE LIMITATION FOR SUCH A LEVY HAS NOT EXPIRED. ACCORDINGLY, THE INTIMATION UNDER SECTION 200A AS CONFIRMED BY THE CIT(APPEALS) IN SO FAR AS LEVY OF FEE UND ER SECTION 234E IS SET ASIDE AND FEE LEVIED IS DELETED. HOWEVER, THE OTHER ADJUSTMENT MADE BY THE ASSESSING OFFICER IN THE IMPUGNED INTIMATION SHALL STAND AS SUCH. 7. RESPECTFULLY FOLLOWING THE PRINCIPLE LAID DOWN BY THE TRIBUNAL, I DECIDE THE ISSUE IN F AVOUR OF THE ASSESSEE. 8. RESULTANTLY, THE APPEALS OF THE ASSESSEE ARE ALLOWED. 5 SHRI HEMAL S. GONDALIA ITA NO. 3760/MUM/2015 WE ARE OF THE CONSIDERED VIEW THAT THE FACTS AND LEGAL POINT IN ISSUE INVOLVED IN BOTH THE CASES, I.E., THE PRESENT CASE AS WELL AS THE AFOREMENTIONED DECIDED CASE IN ASSESSEES OWN CASE ARE SIMILAR AND, THEREFORE, RESPECTFULLY FOLLOWING THE AFORESAID DECI SION OF THE COORDINATE BENCH OF THE TRIBUNAL AND IN ORDER TO MAINTAIN JUDICIAL CONSISTENCY, WE ACCEPT THE APPEAL OF THE ASSESSEE. 4. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 1 2 T H AUGUST, 2016. SD/ - SD/ - (R.C. SHARMA) ACCOUNTANT MEMBER (SANDEEP GOSAIN) JUDICIAL MEMBER MUMBAI, DATE : 1 2 T H AUGUST , 2016 *SSL* COPY TO : 1) THE APPELLANT 2) THE RESPONDENT 3) THE CIT(A) CONCERNED 4) THE CIT CONCERNED 5) THE D.R, B BENCH, MUMBAI 6) GUARD FILE BY ORDER DY./ASSTT. REGISTRAR I.T.A.T, MUMBAI