MANISH C. JAIN, MUMBAI V. CIT (A) -59, MUMBAI

ITA 4369/MUM/2015

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 7680 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 8 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-03-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2014-2015
• Appeal Filed On: 16-07-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SUMAN KUMARDR
• Keywords: Non compliance; Right to appeal
• Section: 246

Judgement Text

, , , IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES B, MUMBAI , , , BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER, AND SHRI RAMIT KOCHAR, ACCOUNTANT MEMBER ITA NO.4369/MUM/2015 ASSESSMENT YEAR: 2014-15 MR. MANISH C. JAIN (PROP. SUPREME PHARMA), 03 RD FLOOR, BLOCK NO.303 , HIRA BUILDING 44/52 CHAPSI BHIMJI ROAD, MAZGAON, MUMBAI-400010 / VS. CIT(A) - 59, MUMBAI ( ! /ASSESSEE) ( & / REVENUE) PA NO.:-AABPJ9634N ! / ASSESSEE BY NONE & / REVENUE BY SHRI SUMAN KUMAR-DR ' &( ) ! * / DATE OF HEARING : 30/03/2017 ) ! * / DATE OF ORDER: 06/04/2017 MR. MANISH C. JAIN ITA NO.4369/MUM/2015 2 / O R D E R PER JOGINDER SINGH (JUDICIAL MEMBER) THIS APPEAL IS BY THE ASSESSEE AGAINST THE CONFIRM ING THE LEVY OF LATE FILING FEE AMOUNTING TO RS.5600/- U/S 234E OF THE INCOME TAX ACT, 1961 (HEREINAFTER THE ACT). 2. DURING HEARING, NONE WAS PRESENT FOR THE ASSESSEE IN SPITE OF ISSUANCE OF REGISTERED AD NOTI CE, WHEREAS, SHRI SUMA KUMAR, LD. DR, WAS PRESENT FOR T HE REVENUE. AT THE OUTSET, IT WAS BROUGHT TO OUR NOTIC E, THE ISSUE INVOLVED IN THE PRESENT APPEAL IS IDENTICAL T O THE FACTS OF MAHESH A. SONTAKKE (ITA NO.4366 TO 4368/MUM/2015 ). 2.1. WE HAVE CONSIDERED THE SUBMISSIONS OF LD. DR AND PERUSED THE MATERIAL AVAILABLE ON RECORD. IN VI EW OF THE ABOVE, WE ARE REPRODUCING HEREUNDER THE RELEVANT PO RTION FROM THE AFORESAID ORDER DATED 30/03/2017 IN THE CA SE OF SHRI MAHESH A. SONTAKKE, FOR READY REFERENCE AND AN ALYSIS:- THIS BUNCH OF THREE APPEALS IS BY THE ASSESSEE AGAINST THE CONFIRMING OF LEVY OF LATE FILING FEE AMOUNTING TO RS.15,000/-, RS.35,200/- AND RS.11,200/-, RESPECTIVELY U/S 234E OF THE INCOME TA X ACT, 1961 (HEREINAFTER THE ACT). 2. DURING HEARING, SHRI RAJESH S. SHAH, LD. COUNSEL FOR THE ASSESSEE, CONTENDED THAT THE ISSUE IS COVERED BY THE DECISION IN THE CASE OF ASSESSEE ITS ELF FOR ASSESSMENT YEAR 2014-15 ITSELF (ITA NO.4365/MUM/2015) ORDER DATED 23/09/2016. THIS MR. MANISH C. JAIN ITA NO.4369/MUM/2015 3 FACTUAL MATRIX WAS NOT CONTROVERTED BY THE LD. CIT- DR, SHRI N.P. SINGH. 2.1. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. IN VI EW OF THE ABOVE, WE ARE REPRODUCING HEREUNDER THE RELEVANT PORTION FROM THE AFORESAID ORDER DATED 23/09/2016 IN THE CASE OF ASSESSEE ITSELF, FOR READ Y REFERENCE AND ANALYSIS:- THIS APPEAL IS FILED BY THE ASSESSEE AGAINST THE O RDER OF THE LD. CIT(A)-59, MUMBAI DATED 14.05.2015 PERTAINING TO AS SESSMENT YEAR 2014-15. 2. THE ASSESSEE HAS RAISED FOLLOWING GROUNDS IN ITS APPEAL: 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE C ASE AND IN LAW, THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) ER RED IN CONFIRMING LATE FILING LEVY OF RS. 15,000/- WITHOUT PROVIDING PROPER OPPORTUNITY TO THE APPELLANT. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) ERRED IN CONFIRMING LEVYING LATE FILING LEVY OF RS. 15,000/- FOR DELAY IN FILING OF QUARTERLY STATEMENTS (26Q). 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) ERRED IN CONFIRMING LEVYING THE LATE FILING LEVY. 3. NONE APPEARED ON BEHALF OF THE ASSESSEE INSPITE OF NOTICE ISSUED TO THE ASSESSEE. THEREFORE, WE HEARD THE LD. DEPART MENTAL REPRESENTATIVE AND DISPOSED OFF THIS MATTER EX PART E ON MERIT. 4. BRIEF FACTS ARE THAT THE ASSESSING OFFICER WHILE PASSING INTIMATION U/S.200A OF THE I.T. ACT CHARGED LATE FI LING FEE IN RESPECT OF QUARTERLY STATEMENT OF TDS IN FORM NO. 26Q. 5. THE ASSESSEE PREFERRED AN APPEAL BEFORE THE LD. CIT(A). HOWEVER, THE LD. CIT(A) DISMISSED THE APPEAL OF THE ASSESSEE MR. MANISH C. JAIN ITA NO.4369/MUM/2015 4 HOLDING THAT THE ISSUE IS COVERED BY THE DECISION O F THE HONBLE BOMBAY HIGH COURT IN THE CASE OF RASHMIKANT KUNDALI A VS UNION OF INDIA DATED 9.2.2015. 6. WE HAVE HEARD THE LD. DEPARTMENTAL REPRESENTATIV E AND WE FIND THAT A SIMILAR ISSUE HAS ARISEN IN A BUNCH OF APPEALS NAMELY M/S. KASH REALTORS PVT. LTD & OTHERS IN ITA NO. 419 9/M/2015 DATED 27.7.2016 WHEREIN THE CO-ORDINATE BENCH CONSI DERING VARIOUS DECISIONS INCLUDING THE JURISDICTIONAL DECI SION WHICH THE CIT(APPEALS) RELIED ON I.E. RASHMIKANT KUNDALIA VS UNION OF INDIA DATED 9.2.2015 HELD AS UNDER: IN THIS BUNCH OF 17 APPEALS, THE SOLE ISSUE INVOLV ED IS AS TO WHETHER OR NOT, FOR THE PERIOD PRIOR TO 01.06.15, F EES UNDER SECTION 234E OF THE INCOME TAX ACT, 1961 (HEREINAFT ER REFERRED TO AS THE ACT) IN RESPECT OF DEFAULTS IN F URNISHING TDS STATEMENTS, COULD BE LEVIED IN INTIMATION UNDER SECTION 200A OF THE ACT. 2. IN SOME OF THE APPEALS THERE IS A REPRESENTATIO N BY THE LD. COUNSEL/AUTHORIZED REPRESENTATIVE ON BEHALF OF THE ASSESSEE. HOWEVER, IN SOME OF APPEALS, NONE HAS COM E PRESENT AND ADJOURNMENT HAS BEEN SOUGHT. HOWEVER, CONSIDERING THE SHORT AND COMMON ISSUE INVOLVED IN ALL THE APPEALS WHICH CAN BE ADJUDICATED ON THE BASIS OF ON LY A FEW MATERIAL FACTS, WE PROCEED TO DECIDE THE APPEALS RE JECTING THE ADJOURNMENT APPLICATIONS, IF ANY, MOVED IN ANY OF THE ABOVE CAPTIONED APPEALS. 3. IN ALL THESE CASES, THERE WAS ADMITTEDLY A DELAY IN FILING OF THE TDS RETURNS. THE PERIOD INVOLVED IS AFTER 01.07 .12, BUT PRIOR TO 01.06.15. THESE DATES ARE RELEVANT BECAUSE 1.7.2012 IS THE DATE OF INSERTION OF SECTION 234E I NTO THE INCOME TAX ACT, 1961 WHEREAS 1.6.2015 IS THE DATE O F AMENDMENT/SUBSTITUTION OF CLAUSE (C) TO SECTION 200 A VIDE WHICH IT HAS BEEN PROVIDED THAT FEES PAYABLE UNDER SECTION 234E CAN BE ADJUSTED WHILE PROCESSING INTIMATION UN DER SECTION 200A W.E.F. 1.6.2015. 4. NOW COMING TO THE FACTS OF THESE CASES, IN THE C OURSE OF THE PROCESSING OF THE TDS RETURNS, THE ASSESSING OF FICER MR. MANISH C. JAIN ITA NO.4369/MUM/2015 5 (TDS) [HEREINAFTER REFERRED TO AS THE AO(TDS)] RAIS ED DEMAND IN EACH OF THE ABOVE CASES BY WAY OF AN INTI MATION ISSUED UNDER SECTION 200A OF THE ACT FOR LEVY OF FE ES UNDER SECTION 234E FOR DELAY IN FILING OF TDS STATEMENT B EYOND THE PERIOD STIPULATED AS PER THE PROVISIONS OF SECTION 200(3) OF THE ACT. AGGRIEVED BY THIS LEVY OF FEES, THE RESPEC TIVE ASSESSEES CARRIED THE MATTER IN APPEAL BEFORE THE L D. CIT(A) BUT WITHOUT ANY SUCCESS. BEING AGGRIEVED BY THE ORD ERS OF THE LD. CIT(A), THE ASSESSEES IN THE ABOVE CAPTIONE D APPEALS HAVE COME IN APPEAL BEFORE US. 5. WE HAVE HEARD THE RIVAL CONTENTIONS AND HAVE ALS O PERUSED THE MATERIAL ON RECORD. THE CONTENTION OF T HE LD. RESPECTIVE COUNSELS FOR THE ASSESSEES HAS BEEN THAT THIS ISSUE HAS ALREADY BEEN CONSIDERED BY THE AMRITSAR B ENCH OF THE TRIBUNAL IN THE CASE OF SIBIA HEALTHCARE PVT. LTD. VS. DCIT (2015) 171 TTJ (ASR) 0145 WHEREIN THE AMRITSA R BENCH OF THE TRIBUNAL HAS HELD THAT SINCE THE INTIM ATION UNDER SECTION 200A IS AN APPEALABLE ORDER BEFORE TH E LD. CIT(A) (W.E.F. 1.7.2012) UNDER SECTION 246A(A) AND THEREFORE THE LD. CIT(A) COULD HAVE EXAMINED THE VA LIDITY OF THE ADJUSTMENTS MADE UNDER THE INTIMATION UNDER SEC TION 200A IN THE LIGHT AND SCOPE OF THE PROVISIONS OF SE CTION 200A. THE TRIBUNAL FURTHER OBSERVED THAT SINCE THER E WAS NO ENABLING PROVISION UNDER SECTION 200A BEFORE 01.06. 15 PROVIDING FOR THE ADJUSTMENT IN RESPECT OF LEVY OF FEES UNDER SECTION 234E WHILE PROCESSING THE TDS STATEMENTS, H ENCE IN THE ABSENCE OF SUCH AN ENABLING PROVISION, NO SUCH LEVY COULD BE AFFECTED. THE PROVISION FOR MAKING ADJUSTM ENTS REGARDING FEES LEVIABLE UNDER SECTION 234E HAS BEEN INTRODUCED BY WAY OF AMENDMENT MADE VIDE FINANCE AC T, 2015 W.E.F. 01.06.15 ONLY. THE TRIBUNAL THEREFORE H ELD THAT THE ACTION OF THE AO IN MAKING ADJUSTMENTS WITH REG ARD TO THE FEES LEVIABLE UNDER SECTION 234E WHILE PROCESSI NG THE TDS STATEMENTS UNDER SECTION 200A FOR THE PERIOD PR IOR TO 1.6.2015, WAS NOT LEGALLY VALID. IT HAS THEREFORE BEEN CONTENDED ON BEHALF OF THE AS SESSEES THAT THE TDS STATEMENTS FILED BY THE ASSESSEE HAS T O BE PROCESSED IN THE MANNER AS LAID DOWN IN THE PROVISI ONS OF SECTION 200A AS IN FORCE DURING THE RELEVANT PERIOD . THAT THE LEVY OF FEES UNDER SECTION 234E OF THE ACT, THUS, C ANNOT BE A MR. MANISH C. JAIN ITA NO.4369/MUM/2015 6 SUBJECT MATTER OF PROCESS, WHILE PROCESSING THE STA TEMENT UNDER SECTION 200A OF THE ACT SO FAR AS THE PERIOD PRIOR TO 01.06.15 IS CONCERNED. 6. THE LD. D.R., ON THE OTHER HAND, HAS RELIED UPON THE DECISION OF THE HONBLE BOMBAY HIGH COURT IN THE CA SE OF RASHMIKANT KUNDALIA VS. UNION OF INDIA DATED 09.0 2.15 WHICH DECISION HAS BEEN RELIED UPON BY THE LD. CIT( A) IN THE IMPUGNED ORDER WHEREIN THE JURISDICTIONAL HONB LE BOMBAY HIGH COURT HAS UPHELD THE CONSTITUTIONAL VAL IDITY OF SECTION 234E. THE LD. D.R. HAS FURTHER SUBMITTED TH AT, EVEN OTHERWISE, THE SECTION 234E OF THE ACT IS AN INDEPE NDENT SECTION AND THE AO (TDS) HAS OTHERWISE JURISDICTION TO LEVY PENALTY FOR DELAY IN FILING TDS STATEMENTS AS PROVI DED UNDER SECTION 200(3) OF THE ACT. IT HAS THEREFORE BEEN CO NTENDED THAT THE AO(TDS) HAS RIGHTLY EXERCISED HIS JURISDIC TION WHILE MAKING ADJUSTMENT OF THE FEES LEVIABLE UNDER SECTION 234E FOR NON COMPLIANCE/DELAY IN FILING THE TDS STA TEMENTS AS PROVIDED UNDER SECTION 200(3) OF THE ACT. 7. WE HAVE HEARD THE RIVAL CONTENTIONS AND HAVE ALS O GONE THROUGH THE CASE LAWS CITED BEFORE US. SO FAR AS TH E RELIANCE OF THE REVENUE ON THE DECISION OF THE HONBLE BOMBA Y HIGH COURT IN THE CASE OF RASHMIKANT KUNDALIA VS. UNION OF INDIA (SUPRA) IS CONCERNED, WE FIND THAT IN THE SA ID CASE THE CONSTITUTIONAL VALIDITY OF SECTION 234E WAS CHA LLENGED. THE HONBLE BOMBAY HIGH COURT HAS UPHELD THE VALIDI TY OF THE SECTION 234E. HOWEVER, THE ISSUE WHETHER THE FE ES LEVIABLE UNDER SECTION 234E CAN BE ADJUSTED WHILE PROCESSING THE TDS STATEMENTS UNDER SECTION 200A OF THE ACT IN RELATION TO THE PERIOD PRIOR TO 01.06.15, HA S NEITHER BEEN RAISED BEFORE THE HONBLE BOMBAY HIGH COURT NO R HAS BEEN ADJUDICATED. HENCE, THE RELIANCE OF THE REVENU E ON THE DECISION OF THE HONBLE BOMBAY HIGH COURT IN THE CA SE OF RASHMIKANT KUNDALIA VS. UNION OF INDIA (SUPRA) SO FAR AS THE ISSUE IS CONCERNED, IS OF NO HELP TO THE REVENU E. ONE OF THE CONTENTIONS RAISED BEFORE THE HONBLE BOMBAY HI GH COURT WAS THAT UNDER THE PROVISIONS OF THE ACT, NO APPEAL IS PROVIDED FOR OR FROM AN ARBITRARY ORDER PASSED UNDE R SECTION 234E OF THE ACT. THE HONBLE BOMBAY HIGH CO URT OBSERVED THAT A RIGHT OF APPEAL IS NOT A MATTER OF RIGHT BUT IS A CREATURE OF STATUTE AND IF THE LEGISLATURE DEEMS IT FIT NOT TO MR. MANISH C. JAIN ITA NO.4369/MUM/2015 7 PROVIDE A REMEDY OF APPEAL, SO BE IT. THE HONBLE B OMBAY HIGH COURT HAS OBSERVED THAT EVEN IN SUCH A SCENARI O, THE AGGRIEVED PARTY IS NOT LEFT REMEDILESS RATHER SUCH AGGRIEVED PERSON CAN ALWAYS APPROACH THE HONBLE HIGH COURT I N EXTRAORDINARY EQUITABLE JURISDICTION UNDER ARTICLE 226/227 OF THE CONSTITUTION OF INDIA, AS THE CASE MAY BE. 8. HOWEVER, IN THE CASES BEFORE US, THE GRIEVANCE OF THE ASSESSEES IS NOT AGAINST THE LEVY OF FEES UNDER SEC TION 234E OF THE ACT INDEPENDENTLY RATHER, THE ISSUE IS THAT WHILE PROCESSING THE TDS STATEMENTS UNDER SECTION 200A OF THE ACT, WHETHER OR NOT, THE FEES LEVIABLE UNDER SECTIO N 234E CAN BE ADJUSTED THEREIN? NO DOUBT, THE ORDER PASSED UNDER SECTION 200A IS AN APPEALABLE ORDER BEFORE THE LD. CIT(A) UNDER SECTION 246 OF THE ACT (W.E.F. 1.7.2012). THE APPELLATE ORDER OF THE LD. CIT(A) PASSED UNDER 250 OF THE ACT IS FURTHER APPEALABLE BEFORE THIS TRIBUNAL UNDER SECTI ON 253 OF THE ACT. HENCE, WE DO NOT FIND ANY ILLEGALITY IN TH E COURSE ADOPTED BY THE ASSESSEES OF INVOKING THE APPEALABLE JURISDICTION OF THIS TRIBUNAL FOR REDRESSAL OF THEI R GRIEVANCE ON THIS ISSUE. 9. SO FAR AS THE ISSUE WHETHER FOR THE PERIOD PRIO R TO 01.06.15, SUCH ADJUSTMENT CAN BE MADE WHILE PROCESS ING THE STATEMENTS UNDER SECTION 200A OF THE ACT IS CONCERN ED, WE FIND THAT THE AMRITSAR BENCH OF THE TRIBUNAL IN THE CASE OF SIBIA HEALTHCARE PVT. LTD. VS. DCIT (SUPRA) HAS H ELD THAT IN THE ABSENCE OF ENABLING PROVISION UNDER SECTION 200A PRIOR TO 01.06.15 SUCH A POWER WAS NOT VESTED WITH THE AO (TDS). THE SAID DECISION HAS BEEN FURTHER FOLLOWED BY THE AHMEDABAD BENCH OF THE TRIBUNAL IN A RECENT DECISIO N DATED 05.02.16 IN THE CASE OF VARUN RADIATORS PVT. LTD. VS DCIT (CPC- TDS) 2016-TIOL-436-ITAT-AHM. HOWEVER, WE HAVE COME ACROSS ANOTHER DECISION OF THE CHENNAI BENCH DATED 10.07.15 IN THE CASE OF SMT. G. INDHIRANI & OTHERS VS. DCIT, CPC-TDS IN ITA NO.109/MAS/2015 & OTHERS WHEREIN THE CHENNAI BENCH OF THE TRIBUNAL HAS CONSI DERED THE DECISION OF THE AMRITSAR BENCH OF THE TRIBUNAL IN THE CASE OF SIBIA HEALTHCARE PVT. LTD. VS. DCIT (SUPR A) AND HAS ARRIVED AT A SIMILAR FINDING THAT UNDER SECTION 200A, IN THE ABSENCE OF ENABLING PROVISION FOR THE PERIOD BE FORE 01.06.15, THE LEVY OF FEE UNDER SECTION 234E WHILE MR. MANISH C. JAIN ITA NO.4369/MUM/2015 8 PROCESSING THE TDS STATEMENTS WAS NOT PERMISSIBLE T O THE AO (TDS). HOWEVER, THE CO-ORDINATE CHENNAI BENCH OF THE TRIBUNAL HAS ALSO EXAMINED THE OTHER CONTENTION OF THE REVENUE THAT SECTION 234E IS AN INDEPENDENT SECTION AND THE FEES CAN BE LEVIED BY THE AO (TDS), INDEPENDENT OF THE PROVISIONS OF SECTION 200A, FOR THE DEFAULT/DELAY I N FILING THE TDS STATEMENTS AS PRESCRIBED UNDER SECTION 200(3) O F THE ACT. THE TRIBUNAL, CONSIDERING THE ABOVE SUBMISSION S, HELD THAT IF THE ASSESSEE FAILS TO PAY THE FEES BEFORE F ILING THE STATEMENT UNDER SECTION 200(3) OF THE ACT, THE ASSE SSING AUTHORITY MAY PASS A SEPARATE ORDER LEVYING OF SUCH A FEE UNDER SECTION 234E OF THE ACT, IF THE SAME IS NOT B ARRED BY TIME LIMIT OR OTHERWISE UNDER ANY OTHER PROVISIONS OF LAW. THE ASSESSING AUTHORITY, HOWEVER, COULD NOT ADJUST THE FEES LEVIABLE UNDER SECTION 234E WHILE PROCESSING THE TD S STATEMENT UNDER SECTION 200A OF THE ACT. HOWEVER, A FTER 01.06.15 THE ASSESSING AUTHORITY IS WELL WITHIN HIS LIMIT TO LEVY FEE UNDER SECTION 234E OF THE ACT EVEN WHILE P ROCESSING THE STATEMENT UNDER SECTION 200A AND MAKING ADJUSTM ENT. THE RELEVANT PART OF THE DECISION OF THE CHENNAI BE NCH OF THE TRIBUNAL FOR THE SAKE OF COMPLETENESS IS REPROD UCED AS UNDER: 4. THE LD. COUNSEL INVITED OUR ATTENTION TO SECTIO N 234A OF THE ACT AND SUBMITTED THAT WHEN AN ASSESSEE FAILS T O DELIVER THE STATEMENT WITHIN THE PRESCRIBED TIME, THE ASSES SEE IS LIABLE TO PAY BY WAY OF FEE A SUM OF Z200/- FOR EVE RY DAY DURING SUCH A PERIOD THE FAILURE CONTINUES. REFERRI NG TO THE WORD USED IN THE SECTION 234E 'HE SHALL BE LIABLE T O PAY', THE LD. COUNSEL POINTED OUT THAT THE ASSESSEE IS LI ABLE TO PAY FEE. HOWEVER, IT DOES NOT EMPOWER THE ASSESSING OFF ICER TO LEVY THE FEE. SECTION 234E(3) OF THE ACT PROVIDES F OR PAYMENT OF THE FEE BEFORE DELIVERY OF STATEMENT UNDER SECTI ON 200(3) OF THE ACT. THEREFORE, THE FEE HAS TO BE PAID BY TH E ASSESSEE VOLUNTARILY BEFORE FILING THE STATEMENT UNDER SECTI ON 200(3) OF THE ACT AND THE ASSESSING AUTHORITY HAS NO POWER TO LEVY THE FEE. 5. ON THE CONTRARY, SH. P. RADHAKRISHNAN, THE LD. DEPARTMENTAL REPRESENTATIVE, SUBMITTED THAT SECTION 234E OF THE ACT PROVIDES FOR PAYMENT OF FEE, IF THE ASSE SSEE FAILS TO DELIVER THE STATEMENT AS PRESCRIBED IN SECTION 200( 3) OF THE MR. MANISH C. JAIN ITA NO.4369/MUM/2015 9 ACT. THEREFORE, THE ASSESSING OFFICER HAS EVERY AUT HORITY TO LEVY FEE EITHER BY A SEPARATE ORDER OR WHILE PROCES SING THE STATEMENT UNDER SECTION 200A OF THE ACT. 6. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITH ER SIDE AND PERUSED THE RELEVANT MATERIAL ON RECORD. SECTIO N 200A OF THE ACT PROVIDES FOR PROCESSING OF THE STATEMENT OF TAX DEDUCTED AT SOURCE BY MAKING ADJUSTMENT AS PROVIDED IN THAT SECTION. FOR THE PURPOSE OF CONVENIENCE, WE AR E REPRODUCING THE PROVISIONS OF SECTION 200A OF THE A CT:- '200A. (1) WHERE A STATEMENT OF TAX DEDUCTION AT SO URCE OR A CORRECTION STATEMENT HAS BEEN MADE BY A PERSON DEDUCTING ANY SUM (HEREAFTER REFERRED TO IN THIS SE CTION AS DEDUCTOR) UNDER SECTION 200, SUCH STATEMENT SHALL B E PROCESSED IN THE FOLLOWING MANNER, NAMELY : (A) THE SUMS DEDUCTIBLE UNDER THIS CHAPTER SHALL B E COMPUTED AFTER MAKING THE FOLLOWING ADJUSTMENTS, NA MELY : (I) ANY ARITHMETICAL ERROR IN THE STATEMENT ; OR (II) AN INCORRECT CLAIM, APPARENT FROM AN INFORMAT ION IN THE STATEMENT (B) THE INTEREST, IF ANY, SHALL BE COMPUTED ON THE BASIS OF THE SUMS DEDUCTIBLE AS COMPUTED IN THE STATEMENT ; (C) THE SUM PAYABLE BY, OR THE AMOUNT OF REFUND DUE TO, THE DEDUCTOR SHALL BE DETERMINED AFTER ADJUSTMENT OF AM OUNT COMPUTED UNDER CLAUSE (B) AGAINST ANY AMOUNT PAID U NDER SECTION 200 AND SECTION 201, AND ANY AMOUNT PAID OT HERWISE BY WAY OF TAX OR INTEREST ; (D) AN INTIMATION SHALL BE PREPARED OR GENERATED AN D SENT TO THE DEDUCTOR SPECIFYING THE SUM DETERMINED TO BE PA YABLE BY, OR THE AMOUNT OF REFUND DUE TO, HIM UNDER CLAUS E (C); AND MR. MANISH C. JAIN ITA NO.4369/MUM/2015 10 (E) THE AMOUNT OF REFUND DUE TO THE DEDUCTOR IN PUR SUANCE OF THE DETERMINATION UNDER CLAUSE (C) 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 T HE FINANCIAL YEAR IN WHICH THE STATEMENT IS FILED. EXPLANATION -FOR THE PURPOSES OF THIS SUB-SECTION, 'ART INCORRECT CLAIM APPARENT FROM ANY INFORMATION IN TH E STATEMENT' SHALL MEAN A CLAIM, ON THE BASIS OF AN E NTRY, IN THE STATEMENT- (I) OF AN ITEM, WHICH IS INCONSISTENT WITH ANOTHER ENTR Y OF THE SAME OR SOME OTHER ITEM IN SUCH STATEMENT (II) IN RESPECT OF RATE OF DEDUCTION OF TAX AT SOUR CE, WHERE SUCH RATE IS NOT IN ACCORDANCE WITH THE PROVISIONS OF THIS ACT; (2) FOR THE PURPOSES OF PROCESSING OF STATEMEN TS UNDER SUBSECTION (1), THE BOARD MAY MAKE A SCHEME FOR CENTRALISED PROCESSING OF STATEMENTS OF TAX DEDUCTE D AT SOURCE TO EXPEDITIOUSLY DETERMINE THE TAX PAYABLE B Y, OR THE REFUND DUE TO, THE DEDUCTOR AS REQUIRED UNDER THE S AID SUB- SECTION. 7. THE ASSESSING OFFICER CANNOT MAKE ANY ADJUSTMENT OTHER THAN THE ONE PRESCRIBED ABOVE IN SECTION 200A OF TH E ACT. BY FINANCE ACT, 2015, WITH EFFECT FROM 01.06.2015, THE PARLIAMENT AMENDED SECTION 200A BY SUBSTITUTING SUB - SECTION (1) OF CLAUSES (C) TO (E). FOR THE PURPOSE OF CONVENIENCE, WE ARE REPRODUCING THE AMENDMENT MADE IN SECTION 200A BY THE FINANCE ACT, 2015 AS UNDER:- 'IN SECTION 200A OF THE INCOME-TAX ACT, IN SUB-SECT ION (1), FOR CLAUSES (C) TO (E), THE FOLLOWING CLAUSES SHALL BE SUBSTITUTED WITH EFFECT FROM THE 1ST DAY OF JUNE, 2 015, NAMELY:- '(C) THE FEE, IF ANY, SHALL BE COMPUTED IN ACCORDAN CE WITH THE PROVISIONS OF SECTION 234E; MR. MANISH C. JAIN ITA NO.4369/MUM/2015 11 (D) THE SUM PAYABLE BY, OR THE AMOUNT OF REFUND DUE TO, THE DEDUCTOR SHALL BE DETERMINED AFTER ADJUSTMENT O F THE AMOUNT COMPUTED UNDER CLAUSE (B) AND CLAUSE (C) AGA INST ANY AMOUNT PAID UNDER SECTION 200 OR SECTION 201 OR SECTION 234E AND ANY AMOUNT PAID OTHERWISE BY WAY O F TAX OR INTEREST OR FEE; (E) AN INTIMATION SHALL BE PREPARED OR GENERATED AN D SENT TO THE DEDUCTOR SPECIFYING THE SUM DETERMINED TO BE PAYABLE BY, OR THE AMOUNT OF REFUND DUE TO, HIM UND ER CLAUSE (D); AND (F) THE AMOUNT OF REFUND DUE TO THE DEDUCTOR IN PU RSUANCE OF THE DETERMINATION UNDER CLAUSE (D) SHALL BE GRAN TED TO THE DEDUCTOR.' THEREFORE, IT IS OBVIOUS THAT PRIOR TO 01.06.2015, THERE WAS NO ENABLING PROVISION IN SECTION 200A OF THE AC T FOR MAKING ADJUSTMENT IN RESPECT OF THE STATEMENT FILED BY THE ASSESSEE WITH REGARD TO TAX DEDUCTED AT SOURCE BY L EVYING FEE UNDER SECTION 234E OF THE ACT. THE PARLIAMENT F OR THE FIRST TIME ENABLED THE ASSESSING OFFICER TO MAKE ADJUSTMENT BY LEVYING FEE UNDER SECTION 234E OF THE ACT WITH EFFECT FROM 01.06.2015. THEREFORE, AS RIGHTLY SUBMITTED BY THE LD. COUNSEL FOR THE ASSESSEES, WHI LE PROCESSING STATEMENT UNDER SECTION 200A OF THE ACT, THE ASSESSING OFFICER CANNOT MAKE ANY ADJUSTMENT BY LEV YING FEE UNDER SECTION 234E PRIOR TO 01.06.2015. IN THE CASE BEFORE US, THE ASSESSING OFFICER LEVIED FEE UNDER S ECTION 234E OF THE ACT WHILE PROCESSING THE STATEMENT OF T AX DEDUCTED AT SOURCE UNDER SECTION 200A OF THE ACT. THEREFORE, THIS TRIBUNAL IS OF THE CONSIDERED OPINI ON THAT THE FEE LEVIED BY THE ASSESSING OFFICER UNDER SECTI ON 234E OF THE ACT WHILE PROCESSING THE STATEMENT OF TAX DE DUCTED AT SOURCE IS BEYOND THE SCOPE OF ADJUSTMENT PROVIDE D UNDER SECTION 200A OF THE ACT. THEREFORE, SUCH ADJU STMENT CANNOT STAND IN THE EYE OF LAW. 8. THE NEXT CONTENTION OF THE ASSESSEE IS THAT SECT ION 234E OF THE ACT SAYS THAT THE ASSESSEE 'SHALL BE LIABLE TO PAY' BY WAY OF FEE, THEREFORE, THE ASSESSEE HAS TO VOLUNTAR ILY PAY THE FEE AND THE ASSESSING OFFICER HAS NO AUTHORITY TO LEVY MR. MANISH C. JAIN ITA NO.4369/MUM/2015 12 FEE. THE ARGUMENT OF THE LD.COUNSEL FOR THE ASSESSE E IS VERY ATTRACTIVE AND FANCIFUL. HOWEVER, WE DO NOT FI ND ANY SUBSTANCE IN THAT ARGUMENT. WHEN SECTION 234E CLEAR LY SAYS THAT THE ASSESSEE IS LIABLE TO PAY FEE FOR THE DELAY IN DELIVERY OF THE STATEMENT WITH REGARD TO TAX DEDUCT ED AT SOURCE, THE ASSESSEE SHALL PAY THE FEE AS PROVIDED UNDER SECTION 234E(1) OF THE ACT BEFORE DELIVERY OF THE S TATEMENT UNDER SECTION 200(3) OF THE ACT. IF THE ASSESSEE FA ILS TO PAY THE FEE FOR THE PERIODS OF DELAY, THEN THE ASSESSIN G AUTHORITY HAS ALL THE POWERS TO LEVY FEE WHILE PROC ESSING THE STATEMENT UNDER SECTION 200A OF THE ACT BY MAKI NG ADJUSTMENT AFTER 01 .06.2015. HOWEVER, PRIOR TO 01 .06.2015, THE ASSESSING OFFICER HAD EVERY AUTHORITY TO PASS AN ORDER SEPARATELY LEVYING FEE UNDER SECTION 234E OF THE ACT. WHAT IS NOT PERMISSIBLE IS THAT LEVY OF FEE UNDER SECTION 234E OF THE ACT WHILE PROCESSING THE STATEM ENT OF TAX DEDUCTED AT SOURCE AND MAKING ADJUSTMENT BEFORE 01 .06.2015. IT DOES NOT MEAN THAT THE ASSESSING OFFIC ER CANNOT PASS A SEPARATE ORDER UNDER SECTION 234E OF THE ACT LEVYING FEE FOR THE DELAY IN FILING THE STATEME NT AS REQUIRED UNDER SECTION 200(3) OF THE ACT. 9. THE CONTENTION OF THE ASSESSEE CAN ALSO BE EXAM INED IN THE LIGHT OF THE PROVISIONS OF INDIAN PENAL CODE. S ECTION 396 OF INDIAN PENAL CODE PROVIDES FOR PUNISHMENT FO R DACOITY WITH MURDER. THE PUNISHMENT IS IMPRISONMENT FOR LIFE OR RIGOROUS IMPRISONMENT FOR A TERM WHICH MAY BE EXTENDED TO TEN YEARS AND ALSO LIABLE TO FINE. FOR THE PURPOSE OF CONVENIENCE, WE ARE REPRODUCING SECTION 396 OF INDIAN PENAL CODE, HEREUNDER:- '396. DACOITY WITH MURDER - IF ANY ONE OF FIVE OR M ORE PERSONS, WHO ARE CONJOINTLY COMMITTING DACOITY, COM MITS MURDER IN SO COMMITTING DACOITY, EVERY ONE OF THOSE PERSONS SHALL BE PUNISHED WITH DEATH, OR IMPRISONME NT FOR LIFE, OR RIGOROUS IMPRISONMENT FOR A TERM WHICH MAY EXTEND TO TEN YEARS, AND SHALL ALSO BE LIABLE TO FI NE.' SIMILARLY, SECTION 408 OF INDIAN PENAL CODE PROVIDE S FOR CRIMINAL BREACH OF TRUST BY A CLERK OR SERVANT. IN ADDITION TO IMPRISONMENT WHICH MAY EXTEND TO SEVEN YEARS, TH E ACCUSED WHO IS FOUND TO BE GUILTY SHALL ALSO BE LIA BLE TO MR. MANISH C. JAIN ITA NO.4369/MUM/2015 13 FINE. SIMILARLY, THE OTHER PROVISIONS OF INDIAN PEN AL CODE ALSO SAY THAT IN ADDITION TO IMPRISONMENT, THE ACCU SED SHALL BE LIABLE TO PAY FINE. THE LANGUAGE USED BY T HE PARLIAMENT IN INDIAN PENAL CODE IS 'SHALL ALSO BE L IABLE TO FINE'. THIS MEANS THAT THE MAGISTRATE OR SESSION S JUDGE, WHO TRIES THE ACCUSED FOR AN OFFENCE PUNISHA BLE UNDER THE PROVISIONS OF INDIAN PENAL CODE, IN ADDIT ION TO PUNISHMENT OF IMPRISONMENT, SHALL ALSO LEVY FINE. I F THE CONTENTION OF THE LD.COUNSEL FOR THE ASSESSEES IS A CCEPTED, THEN THE MAGISTRATE OR SESSIONS JUDGE, AS THE CASE MAY BE, WHO IS TRYING THE ACCUSED FOR THE OFFENCE PUNIS HABLE UNDER INDIAN PENCAL CODE, MAY NOT HAVE AUTHORITY TO LEVY FINE. 10. IT IS WELL KNOWN PRINCIPLE THAT THE FINE PRESCR IBED UNDER THE INDIAN PENAL CODE HAS TO BE LEVIED BY THE CONCERNED MAGISTRATE OR SESSIONS JUDGE WHO IS TRYIN G THE OFFENCE PUNISHABLE UNDER THE INDIAN PENAL CODE. THEREFORE, THE CONTENTION OF THE LD.COUNSEL THAT ME RELY BECAUSE THE PARLIAMENT HAS USED THE LANGUAGE HE SH ALL BE LIABLE TO PAY BY WAY OF FEE', THE ASSESSEE HAS T O PAY THE FEE VOLUNTARILY AND THE ASSESSING OFFICER HAS NO AU THORITY TO LEVY FEE COULD NOT BE ACCEPTED. NO ONE WOULD COM E FORWARD TO PAY THE FEE VOLUNTARILY UNLESS THERE IS A COMPULSION UNDER THE STATUTORY PROVISION. THE PARLI AMENT WELCOMES THE CITIZENS TO COME FORWARD AND COMPLY WI TH THE PROVISIONS OF THE ACT BY PAYING THE PRESCRIBED FEE BEFORE FILING THE STATEMENT UNDER SECTION 200(3) OF THE ACT. HOWEVER, IF THE ASSESSEE FAILS TO PAY THE FEE BEFORE FILING THE STATEMENT UNDER SECTION 200(3) OF THE AC T, THE ASSESSING AUTHORITY IS WELL WITHIN HIS LIMIT IN PAS SING A SEPARATE ORDER LEVYING SUCH A FEE IN ADDITION TO PROCESSING THE STATEMENT UNDER SECTION 200A OF THE ACT. IN OTHER WORDS, BEFORE 01.06.2015, THE ASSESSING AUTHO RITY COULD PASS A SEPARATE ORDER UNDER SECTION 234E LEVY ING FEE FOR DELAY IN FILING THE STATEMENT UNDER SECTION 200(3) OF THE ACT. HOWEVER, AFTER 01 .06.2015, THE ASSESSI NG AUTHORITY IS WELL WITHIN HIS LIMIT TO LEVY FEE UNDE R SECTION 234E OF THE ACT EVEN WHILE PROCESSING THE STATEMENT UNDER SECTION 200A AND MAKING ADJUSTMENT. MR. MANISH C. JAIN ITA NO.4369/MUM/2015 14 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 SECT ION 234E WHILE PROCESSING THE STATEMENT AND MAKE ADJUST MENT UNDER SECTION 200A OF THE ACT. THEREFORE, THE IMPUG NED INTIMATION OF THE LOWER AUTHORITIES LEVYING FEE UND ER SECTION 234E OF THE ACT CANNOT BE SUSTAINED IN LAW. HOWEVER, IT IS MADE CLEAR THAT IT IS OPEN TO THE AS SESSING 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 SECT ION 200A AS CONFIRMED BY THE CIT(APPEALS) IN SOFAR AS L EVY OF FEE UNDER 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. 12. IN THE RESULT, ALL THE APPEALS FILED BY THE AS SESSEES ARE ALLOWED AS INDICATED ABOVE. 7. IN THE CASE IN HAND ALSO THE INTIMATION U/S. 200 A HAS BEEN PROCESSED PRIOR TO 1.6.2015 WHEREIN FEE U/S. 2 34E WAS LEVIED. TAKING CONSISTENT VIEW IN THIS MATTER, FOLLOWING THE SAID DECISION, WE SET ASIDE THE DEMAN D RAISED U/S. 234E OF THE ACT IN THE INTIMATION PROCE SSED U/S. 200A OF THE ACT PRIOR TO 1.6.2015. 8. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. WE FIND THAT IN THE AFORESAID ORDER, THE TRIBUNAL HAS CONSIDERED THE DECISION IN THE CASE OF M/S KASH REALTORS PVT. LTD. & ORS. (ITA NO.4199/MU,/2015) DATED 27/07/2016 OF THE COORDINATE BENCH AND ALSO A DECISION FROM HON'BLE JURISDICTIONAL HIGH COURT I N THE CASE OF RASHMIKANT KUNDALIA VS UOI DATED 09/02/2015. FOLLOWING THE AFORESAID ORDER, WE SET- ASIDE THE DEMAND RAISED U/S 234E OF THE ACT IN THE INTIMATION PROCESSED U/S 200A OF THE ACT PRIOR TO 01/06/2015. SIMILAR VIEW HAS BEEN TAKEN BY THE HON'BLE KARNATAKA HIGH COURT IN THE CASE OF FATHERAJ MR. MANISH C. JAIN ITA NO.4369/MUM/2015 15 SINGHVI V. UNION OF INDIA [2016] 73 TAXMANN.COM 252 (KARNATAKA). FINALLY, ALL THE THREE APPEALS OF THE ASSESSEE ARE ALLOWED. WE FIND THAT IN THE AFORESAID ORDER, THE TRIBUNAL H AS CONSIDERED THE DECISION IN THE CASE OF M/S KASH REA LTORS PVT. LTD. & ORS. (ITA NO.4199/MUM/2015) DATED 27/07/2016 OF THE COORDINATE BENCH AND ALSO A DECIS ION FROM HON'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF RASHMIKANT KUNDALIA VS UOI DATED 09/02/2015. FOLLOW ING THE AFORESAID ORDER, WE SET-ASIDE THE DEMAND RAISED U/S 234E OF THE ACT IN THE INTIMATION PROCESSED U/S 200 A OF THE ACT PRIOR TO 01/06/2015. SIMILAR VIEW HAS BEEN TAKE N BY THE HON'BLE KARNATAKA HIGH COURT IN THE CASE OF FATHERAJ SINGHVI V. UNION OF INDIA [2016] 73 TAXMANN.COM 252 (KARNATAKA). FINALLY, THE APPEAL OF THE ASSESSEE IS ALLOWED. THIS ORDER WAS PRONOUNCED IN THE OPEN COURT IN THE PRESENCE OF LD. DR AT THE CONCLUSION OF THE HEARING ON 30/03/2017. SD/- SD/- ( RAMIT KOCHAR ) (JOGINDER SINGH) '# / ACCOUNTANT MEMBER $# / JUDICIAL MEMBER ' ( MUMBAI; + DATED : 06/04/2017 F{X~{T? P.S / ,& MR. MANISH C. JAIN ITA NO.4369/MUM/2015 16 %$&'()(*& / COPY OF THE ORDER FORWARDED TO : 1. -./0 / THE APPELLANT 2. 12/0 / THE RESPONDENT. 3. 3 3 ' 4! ( -. ) / THE CIT, MUMBAI. 4. 3 3 ' 4! / CIT(A)- , MUMBAI 5. 5&6 1! , 3 -.* - 7 , ' ( / DR, ITAT, MUMBAI 6. 8 9( / GUARD FILE. / BY ORDER, 25.! 1! //TRUE COPY// / (DY./ASSTT. REGISTRAR) , ' ( / ITAT, MUMBAI,