Government High School, Bhubaneswar V. DCIT(CPC), TDS, Ghaziabad

ITA 402/CTK/2019

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 3475 (ITAT-CUTTACK)
• Duration Of Justice: 2 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-02-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2015-2016
• Appeal Filed On: 27-11-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: BRAJENDRA M ISHRA
• Keywords: Principle of natural justice; TDS; Set aside
• Section: 234E; 200A; 201; 20

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL CUTTACK BENCH CUTTACK BEFORE SHRI C.M. GARG , J M & SHRI L.P. SAHU, A M . / ITA NO. 401 TO 404 /CTK/201 9 (AY :20 1 5 - 201 6 ) ( QUARTER - 1 ) 2 4 Q (AY :20 1 5 - 201 6 ) ( QUARTER - 2 ) 24Q (AY :20 1 5 - 201 6 ) (QUARTER - 3 ) 24Q (AY:201 5 - 201 6 ) (QUARTER - 4 ) 2 4 Q GOVT. HIGH SCHOOL, UNIT - 6 , GANGANAGAR, BHUBANESWAR - 751001 VS. A CIT( CPC - TDS ), GHAZIABAD T ANNO. : BBNG0 1193 D ( / APPELLANT ) .. ( / RESPONDENT ) /ASSESSEE BY : S HRI BRAJENDRA M ISHRA, ADVOCATE /REVENUE BY : SHRI J.K.LENKA, DR / DATE OF HEARING : 24 / 02 /20 20 / DATE OF PRONOUNCEMENT : 25 / 02 /20 20 / O R D E R PER BENCH : TH ESE ARE THE FOUR APPEAL S HAVE BEEN FILED BY THE ASSESSEE AGAINST THE ORDER OF CIT(A) - 1, BHUBANESWAR ALL DATED 21.08.2019 FOR THE 1 ST , 2 ND , 3 RD & 4 TH QUARTER S FOR THE FINANCIAL YEAR 2013 - 2014 RELEVANT TO ASSESSMENT YEAR 2014 - 2015, ON THE FOLLOWING COMMON GROUNDS : - 1. FOR THAT THE ORDER OF ASSESSMENT IS AGAINST THE SETTLE PRINCIPLE OF LAW. 2. FOR THAT THE LEVY OF LATE FILING FEES U/S 234E PRIOR TO 01.06.2015 IS NOT MAINTAINABLE IN THE EYES OF LAW. 3. FOR THAT THE ORDER OF ASSESSMENT U/S 200A BY THE CPC - TDS, GHAZIABAD AND BY THE COMM ISSIONER OF APPEAL - 1, BHUBANESWAR IS EX - PARTE IN NATURE AND NOT MAINTAINABLE. 4. FOR THAT THE ASSESS FILLED E - TDS RETURN FOR THE 1ST QUARTER OF FINANCIAL YEAR 2014 - 15 BEFORE 01.06.2015 ON 26.05.2015. THE ASSESSMENT ORDER PASSED LEVYING LATE FILING FEES OF RS. 9 ,000/ - IS LIABLE TO BE QUASHED. 5. FOR THAT BOTH THE IMPUGNED ORDERS HAVE BEEN PASSED VIOLATING THE PRINCIPLES OF NATURAL JUSTICE SAME ARE LIABLE TO BE QUASHED. ITA NO S . 401 - 404 /CTK/201 9 2 6. FOR THAT THE APPELLANT CRAVES LEAVE TO SUBMIT DETAILS AT THE TIME OF HEARING. 2 . BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE IS A GOVERNMENT HIGH SCHOOL SITUATED AT UNIT - VI, GANGANAGAR, BHUBANESWAR AND IT WAS REQUIRED TO MAKE TDS ON THE SALARY PAYMENTS AND IT WAS DEPOSITED INTO THE GOVERNMENT ACCOUNT WITHIN THE DUE DATE. IT WAS AL SO FILED E - TDS QUARTERLY RETURNS AND SUBMITTED TO THE NSDL WITHIN THE DUE DATE WHICH WAS NOT DONE IN TIME, THEREFORE, THE ACIT(CPC - TDS), GHAZIABAD RAISED THE DEMANDS AS UNDER : - F.Y. QUARTER DATE OF FILING OF REGULAR STATEMENT ORDER PASSED DEMAND RAISED 2014 - 2015 1 ST 22.05.2015 26.05.2015 9,000/ - 2014 - 2015 2 ND 22.05.2015 26.05.2015 12,000/ - 2014 - 2015 3 RD 22.05.2015 26.05.2015 3000/ - 2014 - 2015 4 TH 22.05.2015 03.06.2015 1400/ - 3 . AGAINST THE ABOVE DEMAND RAISED U/S.234E OF THE ACT, BY THE CPC (TDS), T HE ASSESSEE APPEALED BEFORE THE CIT(A) AND THE CIT(A) DISMISSED ALL THE APPEALS OF THE ASSESSEE HOLDING THAT THERE WAS DELAY IN FILING THE APPEALS BEFORE HIM. 4 . FURTHER AGGRIEVED, THE ASSESSEE IS IN APPEAL S BEFORE THE INCOME TAX APPELLATE TRIBUNAL. 5 . AT THE OUTSET, LD. AR RELIED ON THE ORDER OF COORDINATE BENCH OF THE TRIBUNAL AND SUBMITTED THAT THE ISSUE INVOLVED IN THESE FOUR APPEALS IS COVERED BY THE DECISION OF THIS BENCH OF THE TRIBUNAL IN ITA ITA NO S . 401 - 404 /CTK/201 9 3 NO.379/CTK/2018, WHEREIN THE TRIBUNAL HAS DECIDED THE ISS UE IN FAVOUR OF THE ASSESSEE. 6 . LD. DR, ON THE OTHER HAND, RELIED ON THE ORDERS OF AUTHORITIES BELOW. 7 . AFTER HEARING THE SUBMISSIONS OF BOTH THE SIDES AND PERUSING THE ENTIRE MATERIAL AVAILABLE ON RECORD, WE FIND THAT THE ASSESSEE HAS DEDUCTED TDS, WHIC H HAS BEEN DEPOSITED INTO THE GOVERNMENT ACCOUNTS WITHIN THE TIME AND ON PERUSAL OF THE DEMAND NOTICE RAISED BY THE CPC(TDS), IT IS NOTICED THAT THERE IS NO ANY SHORT PAYMENT, SHORT DEDUCTION/COLLECTION, INTEREST ON PAYMENT DEFAULT U/S.201(1A)/206C(7) OF T HE ACT, INTEREST ON SHORT PAYMENT, INTEREST ON LATE PAYMENT, INTEREST ON DEDUCTION/COLLECTION DEFAULT U/S.201(1A)/206C(7) OF THE ACT, INTEREST ON SHORT DEDUCTION/COLLECTION, INTERES T ON LATE DEDUCTION/COLLECTION, WHICH SHOWS THAT THERE WAS NO DELAY FOR DED UCTION AND DEPOSIT INTO THE CENTRAL GOVERNMENTS ACCOUNT. ONLY THE ASSESSEE DID NOT COMPLY THE PROVISIONS OF SECTION 234E OF THE ACT, THEREFORE, THE CPC(TDS) HAS RAISED THE DEMAND AGAINST THE ASSESSEE. THE ISSUE BEFORE US RELATES TO PRIOR TO THE AMENDMENT IN SECTION 234E OF THE ACT. THEREFORE, THE DECISION RELIED ON BY THE LD. AR OF THE ASSESSEE IN ASSESSEES OWN CASE AS CITED SUPRA IS SQUARELY APPLICABLE, WHEREIN THE TRIBUNAL HAS HELD AS UNDER : - 7. AFTER HEARING THE SUBMISSIONS OF LD. DR, WE NOTICED THAT THE DEMAND ISSUED BY THE CPC, GHAZIABAD DATED 03.06.2015 IMPOSING ITA NO S . 401 - 404 /CTK/201 9 4 LATE FEE OF RS.74,400/ - U/S.234E OF THE ACT. WE FURTHER NOTICED THAT IN THE ACKNOWLEDGEMENT THERE WAS NO ANY FAILURE ON THE PART OF THE ASSESSEE HAS BEEN SHOWN I.E. SHORT PAYMENT, SHORT DED UCTION/COLLECTION, INTEREST ON PAYMENT DEFAULT U/S.201(1A)/206C(7) OF THE ACT, INTEREST ON SHORT PAYMENT, INTEREST ON LATE PAYMENT, INTEREST ON DEDUCTION/COLLECTION DEFAULT U/S.201(1A)/206C(7) OF THE ACT, INTEREST ON SHORT DEDUCTION/COLLECTION, INTEREST ON LATE DEDUCTION/COLLECTION. IT IS, THEREFORE, AMPLY CLEAR THAT THE ASSESSEE HAD DEDUCTED TDS ON THE DUE AMOUNTS AND IT HAS BEEN DEPOSITED WITHIN THE TIME AND THERE IS MERELY A FAILURE FOR LATE FILING OF QUARTERLY TDS RETURN FOR THE QUARTER - IV. THE ASSESSEE IS A GOVERNMENT DEPARTMENT AND THE CASE IS RELATED TO FINANCIAL YEAR 2013 - 2014 BEFORE AMENDMENT IN THE ACT. MERELY THE INTIMATION WAS GENERATED U/S.200A OF THE ACT ON 03.06.2015, CANNOT BE THE BASIS FOR THE LEVY OF FEE U/S.234E OF THE ACT. TO SUPPORT OUR ABOVE VIEW, RELIANCE CAN BE PLACED ON THE DECISION OF JODHPUR BENCH OF THE TRIBUNAL IN THE CASE OF STATION HEADQUARTERS (ARMY) VS. ACIT, [2019] 108 TAXMANN.COM 294(JODHPUR - TRIB.), WHEREIN THE COORDINATE BENCH OF THE TRIBUNAL AT PARA 6 HAS OBSERVED AS UNDE R : - 6. IN THE LIGHT OF THE AFORESAID DECISION AND RESPECTFULLY FOLLOWING THE SAME, WE NOTE THAT IT APPEARS THAT IN ALL MATTERS, THE INTIMATION GIVEN BY THE AO WHICH ARE GIVEN IN PURPORTED EXERCISE OF POWER U/S. 200A ARE IN RESPECT OF LATE FEES U/S. 234E OF THE ACT FOR THE PERIOD PRIOR TO 01.06.2015. AS SUCH, IT IS ON ACCOUNT OF THE INTIMATION GIVEN MAKING DEMAND OF THE LATE FEE IN PURPORTED EXERCISE OF POWERS U/S. 200A OF THE ACT. WE NOTE THAT CLAUSE (C) OF SEC. 200A OF THE ACT EMPOWERS THE AO TO LEVY LA TE FEE WAS W.E.F. 01.06.2015 AND THERE IS NO INDICATION [WHICH IS EITHER EXPRESS OR IMPLIED] WHILE AMENDMENT WAS MADE THAT IT IS RETROSPECTIVE OR CLARIFACTORY IN NATURE. SINCE THE AO IS EMPOWERED TO LEVY THE LATE FEE FOR LATE FILING OF THE STATEMENT OF TDS /TCS STATEMENT AND IN THE MEMORANDOM EXPLAINING THE INTRODUCTION OF FINANCE BILL, 2015 CLEARLY TOOK NOTE OF THE PROVISIONS OF CHAPTER XVIIB UNDER WHICH THE PERSONS DEDUCTING TAX I.E. DEDUCTOR WAS REQUIRED TO FILE QUARTERLY TAX DEDUCTION AT SOURCE, STATEMEN TS CONTAINING THE DETAILS OF DEDUCTION OF TAX MADE DURING QUARTERLY BY THE PRESCRIBED DUE DATES. (SIMILAR RESPONSIBILITY IS ON THE PERSONS REQUIRED TO COLLECT TAX OF CERTAIN SPECIFIED RECEIPT U/S. 206C OF THE ACT). IN ORDER TO PROVIDE EFFECTIVE DETERRENCE AGAINST THE DELAY IN FURNISHING TDS/TCS STATEMENTS, THE FINANCE ACT, 2012 INSERTED SEC. 234E OF THE ACT TO PROVIDE FOR LEVY OF FEES ON LATE FURNISHING OF TDS STATEMENTS. THE MEMORANDUM OF FINANCE BILL, 2015, FURTHER TOOK NOTE OF THE FACT THAT THE FINANCE ( NO. 2) ACT 2009, INSERTED SEC. 200A IN THE ACT, WHICH PRESCRIBED FOR FURNISHING OF TDS STATEMENTS FOR DETERMINING THE AMOUNT PAYABLE OR REFUNDABLE TO THE DEDUCTOR. IT FURTHER TOOK NOTE THAT HOWEVER, AS SEC. 234E OF THE ACT WAS INSERTED AFTER THE INSERTION OF SEC. 200A IN THE ACT, THE EXISTING PROVISIONS OF SEC. 200A OF THE ACT DO NOT PROVIDE FOR DETERMINATION OF LATE FEES PAYABLE U/S. 234E OF THE ACT AT THE TIME OF PROCESSING OF TDS STATEMENT. IT WAS THUS, PROPOSED TO AMEND THE PROVISIONS OF SEC. 200A OF TH E ACT SO AS TO ENABLE THE COMPUTATION OF TAXES PAYABLE U/S. 234E OF THE ACT AT THE TIME OF PROCESSING OF TDS ITA NO S . 401 - 404 /CTK/201 9 5 STATEMENT U/S. 200A OF THE ACT. TAKING NOTE OF THE AFORESAID LEGAL HISTORY THE MEMORANDUM EXPLAINING FINANCE BILL, 2015 TOOK NOTE OF THE FACT THAT AT THAT TIME THERE DOES NOT EXIST ANY PROVISION IN THE ACT TO ENABLE THE PROCESSING AS TCS RETURNS AND HENCE, A PROPOSAL WAS MADE TO INSERT A PROVISION IN THIS REGARD AND ALSO THE POST PROVISION WAS INCORPORATED THE MECHANISM FOR COMPUTATION OF LATE FEES P AYABLE U/S. 234E OF THE ACT. THUS, WE NOTE THAT A PERUSAL OF THE MEMORANDUM EXPLAINING THE INSERTION OF PROVISION RELATING TO INSERTION OF CLAUSE (C) TO SEC. 200A OF THE ACT CLARIFIES THE INTENTION OF THE LEGISLATURE IN INSERTING THE SAID PROVISION. THE FI NANCE BILL FURTHER CLEARLY PROVIDES THAT THE AMENDMENT TOOK EFFECT FROM 01.06.2015, SO THERE IS NO INDICATION WHATSOEVER THAT CLAUSE (C) OF SECTION 200A IS RETROSPECTIVE OR CLARIFICATORY IN NATURE. THEREFORE, THE AO IS NOT EMPOWERED TO LEVY LATE FEES U/S. 234E OF THE ACT BEFORE 01.06.2015. THEREFORE, IN THE LIGHT OF THE AFORESAID DISCUSSION AND THE RATIO LAID BY THE PUNE BENCH IN MAHARASTRA CRICKET ASSOCIATION ( SUPRA ), WE HOLD THAT THE AMENDMENT [CLAUSE (C)] WAS INSERTED U/S. 200A OF THE ACT WHICH HAS BEEN GIVEN EFFECT FROM 01.06.2015 IS PROSPECTIVE IN NATURE, AND NO COMPUTATION OF LATE FEE FOR THE DEMAND OR THE INTIMATION FOR THE LATE FEE U/S. 234E COULD BE MADE FOR THE TDS DEDUCTED FOR THE RESPECTIVE ASSESSMENT YEARS PRIOR TO 01.06.2015. THEREFORE, THE INT IMATION U/S. 200A OF THE ACT BY THE AO, TDS FOR PAYMENT OF LATE FEE U/S. 234E OF THE ACT FOR THE RESPECTIVE ASSESSMENT YEARS PRIOR TO 01.06.2015 IS WITHOUT ANY AUTHORITY OF LAW. IN THE LIGHT OF THE AFORESAID VIEW, WE SET ASIDE THE ORDER OF THE LD. CIT(A) A ND REMAND THE MATTER BACK TO THE FILE OF AO WITH A DIRECTION TO AO THAT THE LATE FEE LEVIED FOR THE PERIOD OF DELAY OF FILING RETURN PRIOR TO 01.06.2015 NEED TO BE DELETED. WE FURTHER CLARIFY THAT THE AO IS WELL WITHIN HIS JURISDICTION TO LEVY LATE FEE U/S . 234E OF THE ACT FOR THE PERIOD STARTING ONLY FROM 01.06.2015 TO THE DATE OF ACTUAL FILING OF THE TDS RETURN. IN SUM AND SUBSTANCE, THE LEVY OF LATE FEE U/S. 234E OF THE ACT IS VALID FROM THE PERIOD FROM 01.06.2015 TO THE DATE OF ACTUAL FILING OF THE TDS RETURN AND THE BALANCE FEES LEVIED EARLIER TO 01.06.2015 IS DIRECTED TO BE DELETED. RESPECTFULLY FOLLOWING THE ABOVE OBSERVATIONS OF THE TRIBUNAL IN THE AFORESAID CASE AND LOOKING TO THE FACTS AND CIRCUMSTANCES OF THE CASE, WE SET ASIDE THE IMPUGNED ORDE R PASSED BY THE CIT(A) AND DIRECT THE AO TO DELETE THE FEE LEVIED U/S.234E OF THE ACT AT RS.74,400/ - ON ACCOUNT OF LATE FLING OF TDS RETURN FOR QUARTER - IV. ACCORDINGLY, WE ALLOW THE GROUNDS OF APPEAL RAISED BY THE ASSESSEE. 8 . WE HAVE GONE THROUGH THE ABO VE OBSERVATIONS OF THE TRIBUNAL AND RESPECTFULLY FOLLOWING THE SAME, WE DIRECT THE AO TO DELETE THE FEE LEVIED U/S.234E OF THE ACT FOR THE 1 ST , 2 ND , 3 RD & 4 TH QUARTERS FOR THE FINANCIAL YEAR 2013 - 2014 RELEVANT TO ASSESSMENT YEAR 2014 - 2015 ON ACCOUNT OF LAT E FILING OF TDS RETURN. ACCORDINGLY, WE ALLOW COMMON ITA NO S . 401 - 404 /CTK/201 9 6 GROUNDS OF APPEAL RAISED IN FOUR APPEALS OF THE ASSESSEE AND CONSEQUENTLY, ALL THE FOUR APPEALS OF THE ASSESSEE ARE ALLOWED. 9 . IN THE RESULT, ALL THE APPEALS OF THE ASSESSEE ARE ALLOWED . ORDER PRONOUNC ED IN THE OPEN COURT ON 25 / 02 / 20 20 . SD/ - ( C.M.GARG ) SD/ - ( L.P.SAHU ) / JUDICIAL MEMBER / ACCOUNTANT MEMBER CUTTACK ; DATED 25 / 02 /20 20 PRAKASH KUMAR MISHRA, SR.P.S. / COPY OF THE ORDER FORWARDED TO : / BY ORDER, ( SENIOR PRIVATE SECRET ARY ) , / ITAT, CUTTACK 1. / THE APPELLANT - GOVT. HIGH SCHOOL, UNIT - VI, GANGANAGAR, BHUBANESWAR - 751001 2. / THE RESPONDENT - ACIT( CPC - TDS), GHAZIABAD 3. ( ) / THE CIT(A), 4. / CIT 5. , , / DR, ITAT, CUTTACK 6. / GUARD FILE. //TRUE COPY//