ASIAN PIPES & PROFILES P. LTD, AMBERNATH V. A.O. TDS WD KALYAN, MUMBAI

ITA 4741/MUM/2016

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 8423 (ITAT-MUMBAI)
• Duration Of Justice: 7 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-03-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: I
• Assessment Year: misc
• Appeal Filed On: 14-07-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: HEMA BHANUSHALI; KAPIL D TALREJA
• Keywords: Recovery proceedings; Right to appeal; Condonation of delay
• Section: 154

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL 'I' BENCH, MUMBAI BEFORE SHRI JASON P. BOAZ, ACCOUNTANT MEMBER AND SHRI SANJAY GARG, JUDICIAL MEMBER ITA NOS. 4740 & 4741/MUM/2016 (ASSESSMENT YEAR: 2013-14) M/S. ASIAN PIPES & PROFILES VS. ASSESSING OFFICER, TDS WARD PVT. LTD. PLOT NO. 70, MIDC, CHIKLOLI AREA, AMBERNATH (W), 421501 RANI MANSION, MURBAD ROAD KALYAN (W), 421301 PAN AAACA5091N APPELLANT RESPONDENT ITA NO. 4742/MUM/2016 (ASSESSMENT YEAR: 2013-14) M/S. DISHA DISTRIBUTORS VS. ASSESSING OFFICER, TDS WARD B - 208, PRATIK INDL. ESTATE MULUND (W), MUMBAI 400078 RANI MANSION, MURBAD ROAD KALYAN (W), 421301 PAN ADQPB6130P APPELLANT RESPONDENT APPELLANT BY: SHRI KAPIL D. TALREJA & MS. HEMA BHANUSHALI RESPONDENT BY: SHRI SAURABH KUMAR RAI DATE OF HEARING: 27.02.2017 DATE OF PRONOUNCEMENT: 01.03.2017 O R D E R PER BENCH THESE APPEALS BY THE ASSESSEES ARE DIRECTED AGAINST THE ORDERS OF THE CIT(A)-I, THANE DATED 21.03.2016 FOR A.Y. 2013-14. SINCE COMMON ISSUES ARE INVOLVED, THESE APPEALS WERE HEARD TOGETHER AND ARE BEING DISPOSED OFF BY WAY OF A COMMON ORDER FOR THE SAKE OF CONVENIENC E. 2. ORDER ON PETITION FOR CONDONATION OF DELAY IN FILIN G THESE APPEALS 2.1 ADMITTEDLY, THERE WAS A DELAY OF 17 DAYS IN FIL ING THESE THREE APPEALS IN THE CASE OF M/S. ASIAN PIPES & PROFILES PVT. LTD . (ITA NOS. 4740 & 4741/MUM/2016) AND M/S. DISHA DISTRIBUTORS (ITA NO. 4742/MUM/ 2016). THE ASSESSEES HAVE FILED SEPARATE PETITIONS FOR CONDONATION OF THE ITA NOS. 4740, 4741 & 4742/MUM/2016 ASIAN PIPES & PROFILES & DISHA DISTRIBUTORS 2 AFORESAID DELAY IN FILING THESE THREE APPEALS. WE H AVE HEARD BOTH THE PARTIES AND PERUSED THE MATERIAL ON RECORD. THE HON 'BLE APEX COURT IN THE CASE OF COLLECTOR, LAND ACQUISITION VS. MST. KATIJI & OTHERS (1987) (167 ITR 471) (SC), WHILE LAYING DOWN THE PRINCIPLES FOR CON SIDERING MATTERS OF CONDONATION OF DELAY IN FILING APPEALS, HAS STATED THAT SUBSTANTIAL JUSTICE SHOULD PREVAIL OVER TECHNICAL CONSIDERATIONS. THE H ON'BLE COURT ALSO EXPLAINED THAT EVERY DAYS DELAY MUST BE EXPLAINED, DOES NOT MEAN THAT A PEDANTIC APPROACH SHOULD BE TAKEN. THE DOCTRINE MUS T BE APPLIED IN A NATURAL AND PRAGMATIC MANNER. CONSIDERING THE AFORE SAID PRINCIPLES LAID DOWN BY THE HON'BLE APEX COURT, THE EXPLANATION PUT FORTH BY THE ASSESSEES AND THE MATERIAL ON RECORD, WE ARE OF THE CONSIDERED OPINION THAT THESE ARE FIT CASES FOR CONDONATION OF DELAY O F 17 DAYS IN FILING EACH OF THESE THREE APPEALS AND ACCORDINGLY IN THE INTEREST OF EQUITY AND JUSTICE CONDONE THE SAME. THESE THREE APPEALS ARE ACCORDING LY ADMITTED FOR ADJUDICATION. 3.1 IN THE ABOVE THREE APPEALS, THE ASSESSEES HAVE RAISED THE FOLLOWING IDENTICAL GROUNDS: - ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW: 1. THAT THE COMMISSIONER OF INCOME TAX (APPEALS) HAS D ISMISSED THE REQUEST OF THE ASSESSEE IN THE APPEAL TO WAIVE THE LATE FEE LEVIED U/S 234E OF THE ACT, WITHOUT CONSIDERING THE SUBMIS SIONS ON MERITS. 2. THAT THE SUB SECTION (3) OF THE SECTION 234E OF THE ACT STATES THAT IT SHALL BE PAID BEFORE DELIVERING A TDS STATEMENT. IT MEANS THAT ANY LATE FEES SHOULD HAVE BEEN DEPOSITED JUST AT THE TI ME OF DELIVERING TDS STATEMENT AND NOT LATER THAN THIS. 3. THAT ONCE THE TDS STATEMENT HAS BEEN ACCEPTED WITHO UT LATE FEES, THEN SUCH LATE FEE CANNOT BE RECOVERED LATER ON. IN THE VIEW OF THE ABOVE, LATE FEE CANNOT BE RECOVERED LATER ON BY WAY OF ANY NOTICE, NO NOTICE OF DEMAND U/S 156 CAN BE ISSUED FOR THIS. 4. THAT THE SEC.200A OF THE ACT DOES NOT PERMIT PROCES SING OF TDS STATEMENT FOR DEFAULT IN PAYMENT OF LATE FEES, EXCE PT ANY ARITHMETICAL ERROR, OR INCORRECT CLAIM, OR DEFAULT IN PAYMENT OF INTEREST AND TDS PAYABLE OR REFUNDABLE ETC. HENCE L ATE FEES FOR TDS QUARTERLY STATEMENT CANNOT BE RECOVERED BY WAY OF PROCESSING UNDER SECTION 200A. THEREFORE NO DEMAND NOTICE CANNOT BE ISSUED UNDER THIS SECTION, BUT IF ISSUED, THEN IT IS ILLEGAL. HENCE LIABLE TO BE CANCELLED. ITA NOS. 4740, 4741 & 4742/MUM/2016 ASIAN PIPES & PROFILES & DISHA DISTRIBUTORS 3 5. THAT THE BASIC CONCEPT BEHIND TDS IS, TO DEPOSIT TH E TAX ON THE INCOME OF DEDUCTEE AS HE EARNS THE INCOME. THEREFOR E DEDUCTOR/ RECIPIENT HAS DEPOSITED THE TAX TIMELY. NO SUCH OFF ENCE HAS BEEN COMMITTED BY THE ASSESSEE THAT HE DEDUCTED THE TDS & NOT DEPOSITED THE TAX AND UTILIZING THE MONEY FOR HIS P URPOSE. THEREFORE NO LATE FEES CAN BE IMPOSED ON THE ASSESS EE. 6. IN VIEW OF THE ABOVE SUBMISSIONS ORDER U/S 200A OF THE ACT IMPOSING LATE FEES U/S 234E HAS TO BE CANCELLED AND QUASHED. 7. THE DEPARTMENT VIDE ITS PRESS RELEASE DATED 12 TH MAY 2016 MADE KNOW THAT 'THE INCOME DECLARATION SCHEME 2016 & THE DIRECT TAX DISPUTE RESOLUTION SCHEME 2016' ('SCHEME' FOR SHORT ) CAME INTO FORCE WITH EFFECT FROM 1 ST JUNE, 2016, HAVING RETROSPECT EFFECT. THE SCHEME WAS BENEFICIAL TO THE CLASS OF ASSESSEE WHO HAD ARREARS OF TAX, WHICH IN SHORT MEANS AMOUNT OF TAX, INTERES T OR PENALTY DETERMINED UNDER THE IT ACT OR WT ACT, IN RESPECT O F WHICH APPEAL IS PENDING BEFORE THE CIT(A) OR CWT(A) AS ON 29.02. 2016. THE PENDING APPEAL COULD BE AGAINST AN ASSESSMENT ORDER OR A PENALTY ORDER AS ON 29TH FEBRUARY, 2016. NOW THE MA TTER AS IT STANDS THAT WHETHER THE ASSESSEE BE GIVEN BENEFIT O F THE SCHEME TO SETTLE THE DUES WITH THE FRAMEWORK OF THE SCHEME . 8. THE APPELLANT CRAVES, LEAVE TO ADD, ALTER, AMEND, M ODIFY OR SUBSTITUTE ANY OR ALL THE ABOVE GROUNDS OF THE APPE AL, INCLUDING ARISING CONSEQUENTIAL TO THE POINTS RAISED DURING T HE APPEAL PROCEEDINGS TILL THE FINAL DISPOSAL OF APPEAL, WHIC H ARE WITHOUT PREJUDICE TO ONE ANOTHER. 9. THE APPELLANT THEREFORE PRAYS FOR THE RELIEF REQUES TED IN THE ABOVE GROUNDS. 3.2 FROM A PERUSAL OF THE GROUND RAISED (SUPRA) THE ISSUE RAISED IN ALL THESE APPEALS IS AGAINST THE INTIMATIONS ISSUED UNDER SEC TION 200A OF THE INCOME TAX ACT, 1961 (IN SHORT 'THE ACT') IN CHARGING FEES PAYABLE UNDER SECTION 234E OF THE ACT FOR DEFAULT IN FURNISHING STATEMENTS PRI OR TO THE AMENDMENT TO SECTION 200A(1)(C) OF THE ACT BY FINANCE ACT, 2015 W.E.F. 01.06.2015, WHILE PROCESSING TDS RETURNS. THE LEARNED A.R. OF THE ASS ESSEE WAS HEARD IN SUPPORT OF THE GROUND RAISED. THE LEARNED A.R. POINTED OUT THAT THE LEGISLATURE HAD INSERTED CLAUSE (C) TO SECTION 200A(1) OF THE ACT S PECIFICALLY W.E.F. 01.06.2015 AND SUBMITTED THAT THERE IS NOTHING THEREIN TO SUGG EST THAT THE SAID AMENDMENT WAS CLARIFICATORY OR RETROSPECTIVE IN NAT URE AND THEREFORE IN RESPECT OF TDS STATEMENTS FILED FOR THE PERIOD PRIO R TO 01.06.2015, LATE FEES CHARGEABLE UNDER SECTION 234E OF THE ACT COULD NOT BE LEVIED BY THE ASSESSING OFFICER (AO) IN THE INTIMATION ISSUED UNDER SECTION 200A OF THE ACT. ITA NOS. 4740, 4741 & 4742/MUM/2016 ASIAN PIPES & PROFILES & DISHA DISTRIBUTORS 4 4. THE LEARNED A.R. OF THE ASSESSEE WAS HEARD IN SUPPO RT OF THE GROUNDS RAISED. IT WAS SUBMITTED THAT THE ISSUE RAI SED IN THESE APPEALS IS SQUARELY COVERED IN FAVOUR OF THE ASSESSEES BY THE DECISION OF THE ITAT PUNE BENCH IN THE CASE OF GAJANAN CONSTRUCTIONS AND OTHERS IN ITA NOS.1292 & 1293/PN/2015 AND OTHERS DATED 23.09.2016 WHEREIN IT WAS HELD THAT THE AO IS NOT EMPOWERED TO CHARGE THE FEE S WHILE PROCESSING TDS STATEMENTS AND RETURNS FOR DEFAULT IN FURNISHING ST ATEMENTS UNDER SECTION 234E OF THE ACT, BY WAY OF INTIMATIONS ISSUED UNDER SECTION 200A OF THE ACT, IN RESPECT OF DEFAULTS BEFORE 01.06.2015. 5. PER CONTRA, THE LEARNED D.R. FOR REVENUE EMPHATICAL LY SUPPORTED AND PLACED RELIANCE ON THE ORDERS OF THE AUTHORITIES BE LOW. 6.1 WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED AND CAREFULLY CONSIDERED THE MATERIAL ON RECORD, INCLUDING THE JU DICIAL PRONOUNCEMENTS CITED. WE FIND THAT THE VERY SAME ISSUE WAS CONSIDE RED AT LENGTH AND HELD IN FAVOUR OF THE ASSESSEE BY, INTER ALIA, THE DECIS ION OF THE ITAT PUNE BENCH IN THE CASE OF GAJANAN CONSTRUCTIONS AND OTHE RS IN ITA NOS.1292 & 1293/PN/2015 AND OTHERS DATED 23.09.2016 WHEREIN AT PARAS 15 TO 37 IT HAS BEEN HELD A UNDER: - 15. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSE D THE RECORD. THE ISSUE ARISING IN THIS BUNCH OF APPEALS IS AGAINST L EVY OF FEES UNDER SECTION 234E OF THE ACT. IN ORDER TO ADJUDICATE THE ISSUE, FIRST REFERENCE IS BEING MADE TO THE RELEVANT PROVISIONS OF THE ACT. UNDER CHAPTER XVII HEADED COLLECTION AND RECOVERY OF TAX ES AND UNDER CLAUSE B, DEDUCTION AT SOURCE, THE STATUTE LAYS D OWN THE DUTY OF THE PAYER OF CERTAIN AMOUNTS TO DEDUCT TAX AT SOURCE UN DER SECTIONS 192 TO 194LD, 195 TO 196D OF THE ACT. UNDER SECTION 198 OF THE ACT, IT IS PROVIDED THAT THE TAX DEDUCTED AT SOURCE SHALL FOR THE PURPOSE OF COMPUTING THE INCOME OF ASSESSEE BE DEEMED TO BE IN COME RECEIVED. UNDER SECTION 199 OF THE ACT, IT IS FURTHER PROVIDE D THAT ANY DEDUCTION MADE IN ACCORDANCE WITH THE PROVISIONS OF CHAPTER A ND PAID TO THE CENTRAL GOVERNMENT SHALL BE TREATED AS PAYMENT OF T AX ON BEHALF OF THE PERSON FROM WHOSE INCOME THE DEDUCTION WAS MADE . THE SUM REFERRED TO IN SUB-SECTION (1A) OF SECTION 192 OF T HE ACT AND PAID TO THE CENTRAL GOVERNMENT SHALL BE TREATED AS THE TAX PAID ON BEHALF OF THE PERSON IN RESPECT OF WHOSE INCOME SUCH PAYMENT OF T AX HAS BEEN MADE. 16. SECTION 200 OF THE ACT LAYS DOWN THE DUTY OF TH E PERSON DEDUCTING TAX, WHICH READS AS UNDER:- ITA NOS. 4740, 4741 & 4742/MUM/2016 ASIAN PIPES & PROFILES & DISHA DISTRIBUTORS 5 200. (1) ANY PERSON DEDUCTING ANY SUM IN ACCORDANC E WITH THE FOREGOING PROVISIONS OF THIS CHAPTER SHALL PAY WITH IN THE PRESCRIBED TIME, THE SUM SO DEDUCTED TO THE CREDIT OF THE CENTRAL GOVERNMENT OR AS THE BOARD DIRECTS. (2) ANY PERSON BEING AN EMPLOYER, REFERRED TO IN SUB-SECTION (1A) OF SECTIO N 192 SHALL PAY, WITHIN THE PRESCRIBED TIME, THE TAX TO THE CREDIT O F THE CENTRAL GOVERNMENT OR AS THE BOARD DIRECTS. (2A) IN CASE OF AN OFFICE OF THE GOVERNMENT, WHERE THE SUM DEDUCTED IN ACCORDANCE WITH THE FOREGOING PROVISION S OF THIS CHAPTER OR TAX REFERRED TO IN SUB-SECTION(1A) OF SE CTION 192 HAS BEEN PAID TO THE CREDIT OF THE CENTRAL GOVERNMENT W ITHOUT THE PRODUCTION OF A CHALLAN, THE PAY AND ACCOUNTS OFFIC ER OR THE TREASURY OFFICER OR THE CHEQUE DRAWING AND DISBURSI NG OFFICER OR ANY OTHER PERSON, BY WHATEVER NAME CALLED, WHO I S RESPONSIBLE FOR CREDITING SUCH SUM OR TAX TO THE CR EDIT OF THE CENTRAL GOVERNMENT, SHALL DELIVER OR CAUSE TO BE DE LIVERED TO THE PRESCRIBED INCOME-TAX AUTHORITY, OR TO THE PERSON A UTHORISED BY SUCH AUTHORITY, A STATEMENT IN SUCH FORM, VERIFIED IN SUCH MANNER, SETTING FORTH SUCH PARTICULARS AND WITHIN S UCH TIME AS MAY BE PRESCRIBED. (3) ANY PERSON DEDUCTING ANY SUM ON OR AFTER THE 1S T DAY OF APRIL, 2005 IN ACCORDANCE WITH THE FOREGOING PROVIS IONS OF THIS CHAPTER OR, AS THE CASE MAY BE, ANY PERSON BEING AN EMPLOYER REFERRED TO IN SUBSECTION (1A) OF SECTION 192 SHALL , AFTER PAYING THE TAX DEDUCTED TO THE CREDIT OF THE CENTRAL GOVER NMENT WITHIN THE PRESCRIBED TIME, PREPARE SUCH STATEMENTS FOR SU CH PERIOD AS MAY BE PRESCRIBED AND DELIVER OR CAUSE TO BE DELIVE RED TO THE PRESCRIBED INCOME-TAX AUTHORITY OR THE PERSON AUTHO RISED BY SUCH AUTHORITY SUCH STATEMENT IN SUCH FORM AND VERIFIED IN SUCH MANNER AND SETTING FORTH SUCH PARTICULARS AND WITHI N SUCH TIME AS MAY BE PRESCRIBED: PROVIDED THAT THE PERSON MAY ALSO DELIVER TO THE PR ESCRIBED AUTHORITY A CORRECTION STATEMENT FOR RECTIFICATION OF ANY MISTAKE OR TO ADD, DELETE OR UPDATE THE INFORMATION FURNISH ED IN THE STATEMENT DELIVERED UNDER THIS SUB-SECTION IN SUCH FORM AND VERIFIED IN SUCH MANNER AS MAY BE SPECIFIED BY THE AUTHORITY. 17. UNDER SECTION 200(1) OF THE ACT, IT IS PROVIDED THAT ANY PERSON DEDUCTING ANY SUM IN ACCORDANCE WITH THE PROVISIONS OF THE CHAPTER SHALL PAY WITHIN THE PRESCRIBED TIME, THE SUM SO DE DUCTED TO THE CREDIT OF THE CENTRAL GOVERNMENT OR AS THE BOARD DI RECTS. UNDER SECTION 200(2) OF THE ACT, ANY PERSON BEING AN EMPL OYER, AS REFERRED TO IN SUB-SECTION (1A) OF SECTION 192 OF THE ACT SHALL PAY, WITHIN THE PRESCRIBED TIME, THE TAX TO THE CREDIT OF THE CENTR AL GOVERNMENT OR AS THE BOARD DIRECTS. UNDER SUBSECTION (2A) OF THE ACT , IT IS PROVIDED THAT WHERE THE SUM HAS BEEN DEDUCTED IN ACCORDANCE WITH FOREGOING PROVISIONS OF THE CHAPTER, BY THE OFFICE OF THE GOV ERNMENT, THEN DUTY IS UPON THE TREASURY OFFICER OR THE DRAWING & DISBU RSING OFFICER OR ITA NOS. 4740, 4741 & 4742/MUM/2016 ASIAN PIPES & PROFILES & DISHA DISTRIBUTORS 6 ANY OTHER PERSON, TO DELIVER OR CAUSE TO BE DELIVER ED TO THE PRESCRIBED INCOME TAX AUTHORITIES, OR TO THE PERSON AUTHORIZED BY SUCH AUTHORITY, STATEMENT IN SUCH FORM, VERIFIED IN SUCH MANNER, SE TTING FORTH SUCH PARTICULARS WITHIN SUCH TIME AS MAY BE PRESCRIBED. UNDER SECTION 200(3) OF THE ACT, SIMILAR RESPONSIBILITY IS ON ANY PERSON DEDUCTING ANY SUM ON OR AFTER FIRST DAY OF APRIL, 2005 IN ACC ORDANCE WITH FOREGOING PROVISIONS OF THE CHAPTER, INCLUDING ANY PERSON AS AN EMPLOYER REFERRED TO IN SECTION 192(1A) OF THE ACT. THE ONUS IS UPON SUCH PERSON THAT HE SHALL AFTER PAYING THE TAX TO T HE CREDIT OF CENTRAL GOVERNMENT WITHIN PRESCRIBED TIME, PREPARE SUCH STA TEMENT FOR SUCH PERIOD AS MAY BE PRESCRIBED AND DELIVER OR CAUSE TO BE DELIVERED TO THE PRESCRIBED INCOME TAX AUTHORITY OR ANY PERSON S O AUTHORIZED, SUCH STATEMENT IN SUCH FORM AND VERIFIED IN SUCH MANNER AND SETTING FORTH SUCH PARTICULARS AND WITHIN SUCH TIME AS MAY BE PRO VIDED. THE DUTY IS UPON A PERSON DEDUCTING ANY SUM IN ACCORDANCE WI TH VARIOUS PROVISIONS UNDER THE CHAPTER AND ALSO UPON AN EMPLO YER WHO IS MAKING DEDUCTION OUT OF THE PAYMENTS MADE TO THE EM PLOYEES, THEN SUB-SECTION (3) REQUIRES THAT THE DEDUCTOR IS TO PR EPARE A STATEMENT FOR SUCH PERIOD AS MAY BE PRESCRIBED, WHICH IS TO BE DE LIVERED TO THE PRESCRIBED AUTHORITY, IN SUCH FORM AND VERIFIED AND SETTING FORTH SUCH PARTICULARS AS MAY BE PRESCRIBED. THE SAID STATEMEN T IS TO BE DELIVERED WITHIN SUCH TIME AS MAY BE PRESCRIBED. 18. RULE 31A OF THE INCOME TAX RULES, 1962 (IN SHOR T THE RULES) PROVIDES THAT EVERY PERSON WHO IS RESPONSIBLE FOR D EDUCTION OF TAX UNDER CHAPTER XVIIB SHALL IN ACCORDANCE WITH THE PR OVISIONS OF SECTION 200(3) OF THE ACT, DELIVER OR CAUSE TO BE D ELIVERED, THE QUARTERLY STATEMENTS TO THE DIRECTOR GENERAL OF INC OME TAX (SYSTEMS) OR THE PERSONS AUTHORIZED BY THEM I.E. IN RESPECT O F DEDUCTIONS UNDER VARIOUS PROVISIONS OF THE CHAPTER XVIIB. THE RULE F URTHER PROVIDES THAT THE STATEMENTS REFERRED TO IN SUBRULE (1) ARE TO BE DELIVERED QUARTERLY AND THE STIPULATED PERIOD OF DUE DATE OF FILING THE SAID STATEMENT IN RESPECT OF DEDUCTOR BEING AN OFFICE OF THE GOVERNMENT AND THE DEDUCTOR BEING OTHER THAN GOVERNMENT, ARE P ROVIDED. THE SUB-RULE (3) OF RULE 31A OF THE RULES FURTHER PROVI DES THAT THE STATEMENT REFERRED TO IN SUB-RULE (1) MAY BE FURNIS HED IN ANY OF THE FOLLOWING MANNERS I.E. BY WAY OF FURNISHING THE STA TEMENT IN PAPER FORM OR FURNISHING THE STATEMENT ELECTRONICALLY UND ER DIGITAL SIGNATURE OR AFTER VERIFICATION. INITIALLY, SUCH STATEMENT HA D TO BE FURNISHED IN PAPER FORM AND LATER BY WAY OF AMENDMENT, THE PROCE DURE FOR FURNISHING THE STATEMENT ELECTRONICALLY WAS PROVIDE D. ONCE THE STATEMENT HAS BEEN SO SUBMITTED BY THE DEDUCTOR OF TAX DEDUCTED AT SOURCE, THEN PROCESSING OF STATEMENT IS AS PER THE PROVISIONS OF SECTION 200A OF THE ACT. THE SAID SECTION WAS INSER TED BY THE FINANCE (NO.2) ACT, 2009 W.E.F. 01.04.2010. THE SAID SECTIO N 200A OF THE ACT READS AS UNDER:- 200A. (1) WHERE A STATEMENT OF TAX DEDUCTION AT SO URCE OR A CORRECTION STATEMENT HAS BEEN MADE BY A PERSON DEDU CTING ANY SUM (HEREAFTER REFERRED TO IN THIS SECTION AS DEDUC TOR) UNDER ITA NOS. 4740, 4741 & 4742/MUM/2016 ASIAN PIPES & PROFILES & DISHA DISTRIBUTORS 7 SECTION 200, SUCH STATEMENT SHALL BE PROCESSED IN T HE FOLLOWING MANNER, NAMELY: (A) THE SUMS DEDUCTIBLE UNDER THIS CHAPTER SHALL B E COMPUTED AFTER MAKING THE FOLLOWING ADJUSTMENTS, NAMELY: (I) ANY ARITHMETICAL ERROR IN THE STATEMENT; OR (II) AN INCORRECT CLAIM, APPARENT FROM ANY INFORMA TION 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 DU E TO, THE DEDUCTOR SHALL BE DETERMINED AFTER ADJUSTMENT OF AMOUNT COMPUTED UNDER CLAUSE (B) AGAINST ANY AMOUNT PAID UNDER SECTION 200 AND SECTION 201, AND ANY AMOUNT PAID OTHERWISE BY WAY OF TAX OR INTEREST; (D) AN INTIMATION SHALL BE PREPARED OR GENERATED A ND SENT TO THE DEDUCTOR SPECIFYING THE SUM DETERMINED TO BE PAYABLE BY, OR THE AMOUNT OF REFUND DUE TO, HIM UND ER CLAUSE (C); AND (E) THE AMOUNT OF REFUND DUE TO THE DEDUCTOR IN PU RSUANCE OF THE DETERMINATION UNDER CLAUSE (C) SHALL BE GRAN TED 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 FI NANCIAL YEAR IN WHICH THE STATEMENT IS FILED. EXPLANATION.FOR THE PURPOSES OF THIS SUB-SECTION, 'AN INCORRECT CLAIM APPARENT FROM ANY INFORMATION IN THE STATEMEN T' SHALL MEAN A CLAIM, ON THE BASIS OF AN ENTRY, IN THE STAT EMENT (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 SOURCE, W HERE SUCH RATE IS NOT IN ACCORDANCE WITH THE PROVISIONS OF TH IS ACT. (2) FOR THE PURPOSES OF PROCESSING OF STATEMENTS UN DER SUB- SECTION (1), THE BOARD MAY MAKE A SCHEME FOR CENTRA LISED PROCESSING OF STATEMENTS OF TAX DEDUCTED AT SOURCE TO EXPEDITIOUSLY DETERMINE THE TAX PAYABLE BY, OR THE REFUND DUE TO, THE DEDUCTOR AS REQUIRED UNDER THE SAID SUB-SECTION . 19. SECTION 200A OF THE ACT LAYS DOWN THE MANNER IN WHICH THE STATEMENTS OF TAX DEDUCTED AT SOURCE ARE TO BE PROC ESSED FOR ISSUING THE INTIMATION. FIRST OF ALL, THE SUMS DEDUCTIBLE U NDER THE CHAPTER ARE TO BE COMPUTED AND INTEREST, IF ANY, SHALL BE COMPU TED ON THE BASIS OF SUCH SUMS DEDUCTIBLE AS COMPUTED IN THE STATEMENTS AS PER CLAUSE (A) AND (B) UNDER SECTION 200A(1) OF THE ACT. CLAUSES ( C) TO (F) REPRODUCED ABOVE WERE SUBSTITUTED FOR CLAUSES (C) TO (E) BY TH E FINANCE ACT, 2015 W.E.F. 01.06.2015. PRIOR TO THE SUBSTITUTION, CLAUS ES (C) TO (E) READ AS UNDER:- (C) THE SUM PAYABLE BY, OR THE AMOUNT OF REFUND D UE TO, THE DEDUCTOR SHALL BE DETERMINED AFTER ADJUSTMENT OF AM OUNT ITA NOS. 4740, 4741 & 4742/MUM/2016 ASIAN PIPES & PROFILES & DISHA DISTRIBUTORS 8 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 A ND SENT TO THE DEDUCTOR SPECIFYING THE SUM DETERMINED TO BE PAYABL E BY, OR THE AMOUNT OF REFUND DUE TO, HIM UNDER CLAUSE (C); AND (E) THE AMOUNT OF REFUND DUE TO THE DEDUCTOR IN PU RSUANCE OF THE DETERMINATION UNDER CLAUSE (C) SHALL BE GRANTED TO THE DEDUCTOR. 20. AS PER NEWLY SUBSTITUTED CLAUSE (C) W.E.F. 01.0 6.2015, THE FEES, IF ANY, IS TO BE COMPUTED IN ACCORDANCE WITH THE PROVI SIONS OF SECTION 234E OF THE ACT. HOWEVER, UNDER THE EARLIER CLAUSE (C), THERE WAS NO SUCH PROVISION. 21. SECTION 234E(1) OF THE ACT PROVIDES THAT WHERE A PERSON FAILS TO DELIVER OR CAUSE TO BE DELIVERED, A STATEMENT WITHI N TIME PRESCRIBED IN SECTION 200(3) OF THE ACT OR THE PROVISO TO SECTION 206C(3) OF THE ACT, HE SHALL BE LIABLE TO PAY, BY WAY OF FEES, SUM OF R S.200/- FOR EVERY DAY DURING WHICH THE FAILURE CONTINUES. THE SAID PR OVISIONS WERE INSERTED BY THE FINANCE ACT, 2012 W.E.F. 01.07.2012 . UNDER SUB- SECTION (2), IT IS FURTHER PROVIDED THAT THE AMOUNT OF FEES REFERRED TO IN SUB-SECTION (1) SHALL NOT EXCEED THE AMOUNT OF TAX DEDUCTIBLE OR COLLECTABLE, AS THE CASE MAY BE. SUB-SECTION (3) FU RTHER LAYS DOWN THAT THE AMOUNT OF FEES REFERRED TO IN SUB-SECTION (1) S HALL BE PAID BEFORE DELIVERING OR CAUSING TO BE DELIVERED A STATEMENT I N ACCORDANCE WITH SUB-SECTION 200(3) OF THE ACT OR THE PROVISO TO SEC TION 206C(3) OF THE ACT. THE PROVISIONS OF SAID SECTION HAVE BEEN MADE APPLICABLE TO A STATEMENT TO BE DELIVERED OR CAUSE TO BE DELIVERED ON OR AFTER THE FIRST DAY OF JULY, 2012. 22. READING THE ABOVE SAID PROVISIONS OF THE ACT, I T TRANSPIRES THAT WHERE TAX HAS BEEN DEDUCTED AT SOURCE BY A DEDUCTOR OUT OF THE ACCOUNT OF DEDUCTEE, THEN THE ONUS IS UPON THE DEDU CTOR UNDER SECTION 200 OF THE ACT TO PREPARE A STATEMENT IN SUCH FORM AND VERIFIED IN SUCH MANNER WHICH IS PRESCRIBED UNDER THE ACT IN WH ICH THE PARTICULARS OF TAX DEDUCTION AT SOURCE ARE TO BE PR OVIDED AND THE SAID STATEMENT IS TO BE DELIVERED OR CAUSE TO BE DELIVER ED WITHIN SUCH TIME AS MAY BE PRESCRIBED. RULE 31A OF THE RULES PROVIDE D THE TIME LIMIT FOR THE FURNISHING OF STATEMENT FOR TAX DEDUCTION A T SOURCE ON QUARTERLY BASIS. SECTION 234E OF THE ACT LEVIES FEE S FOR DEFAULT IN FURNISHING THE STATEMENTS OF TAX DEDUCTED AT SOURCE . SUCH FEES IS TO BE PAID BEFORE DELIVERING OR CAUSING TO BE DELIVERED A STATEMENT IN ACCORDANCE WITH SECTION 200(3) OF THE ACT OR PROVIS O TO SECTION 206C(3) OF THE ACT. IN OTHER WORDS, IN CASE THE ASSESSEE HA S DEFAULTED IN NOT DELIVERING THE STATEMENT OR CAUSING TO DELIVER THE STATEMENT WITHIN TIME PRESCRIBED, THEN HE IS LIABLE TO PAY THE FEES WHICH IS SO PRESCRIBED UNDER THE ACT AND SUCH FEES SHALL NOT EX CEED THE AMOUNT OF TAX DEDUCTIBLE OR COLLECTABLE AT SOURCE BUT THE SAME HAS TO BE PAID ALONG WITH STATEMENT WHICH IS TO BE DELIVERED UNDER THE PROVISIONS OF ITA NOS. 4740, 4741 & 4742/MUM/2016 ASIAN PIPES & PROFILES & DISHA DISTRIBUTORS 9 SECTION 200(3) OF THE ACT. THOUGH THE STATEMENT OF TAX DEDUCTED AT SOURCE HAS TO BE FURNISHED BY THE DEDUCTOR, NO DOUB T, UNDER SECTION 200 OF THE ACT, BUT THE SAME HAS TO BE PROCESSED BY THE PRESCRIBED AUTHORITY AS PER PROVISIONS OF SECTION 200A OF THE ACT. IN CASE THERE IS ANY VARIATION IN THE TAX, SUM DEDUCTIBLE UNDER THE CHAPTER AND / OR THEIR PAYMENT, THE ASSESSING OFFICER IS EMPOWERED T O MAKE ADJUSTMENTS IN THIS REGARD AND ALSO REJECT INCORREC T CLAIM MADE BY THE DEDUCTOR WHICH IS APPARENT FROM THE INFORMATION IN THE STATEMENT FILED BY THE DEDUCTOR. FURTHER, THE INCOME-TAX AUTHORITY IS AUTHORIZED TO CHARGE INTEREST, IF ANY, AND THE SAME SHALL BE COMP UTED ON THE BASIS OF SUMS DEDUCTIBLE IN ADDITION TO THE AMOUNT OF TAX DEDUCTED AT SOURCE, WHICH IS TO BE PAID TO THE ACCOUNT OF TREAS URY BY THE DEDUCTOR. IN CASE OF ANY DEFAULT, INTEREST IS TO BE CHARGED A GAINST SUCH DEDUCTOR AND THE SAME IS TO BE COMPUTED AS PER PROVISIONS OF SECTION 200A(1)(B) OF THE ACT. FURTHER, IN ADDITION TO BOTH THESE AMOUNTS, CLAUSE (C) TO SECTION 200A OF THE ACT PROVIDES FEES TO BE LEVIED WHICH SHALL BE COMPUTED IN ACCORDANCE WITH THE PROVISIONS OF SECTION 234E OF THE ACT. THE SAID PROVISION TO CHARGE FEES BY TH E PRESCRIBED AUTHORITY HAS BEEN SUBSTITUTED FOR EARLIER PROVISIO NS BY THE FINANCE ACT, 2015 W.E.F. 01.06.2015. PRIOR TO THE SAID SUBS TITUTION THOUGH THE PROVISIONS OF SECTION 234E OF THE ACT FOR PAYMENT O F FEES FOR DEFAULT IN FURNISHING THE STATEMENT WERE INSERTED BY THE FINAN CE ACT, 2012 W.E.F. 01.07.2012, THE PRESCRIBED AUTHORITY DID NOT HAVE THE POWER TO CHARGE THE SAID FEES, WHILE PROCESSING THE QUARTERL Y STATEMENTS / RETURNS UNDER SECTION 200A OF THE ACT. 23. NOW, LOOKING AT VARIOUS PROVISIONS OF THE ACT, THE ISSUE NEEDS TO BE ADJUDICATED IN THE CASE OF ASSESSEE, WHEREIN ADM ITTEDLY, TDS RETURNS WHICH WERE DEEMED TO BE FILED BY THE ASSESS EE WERE FILED AFTER DELAY AND THE QUESTION WAS WHETHER THE ASSESS ING OFFICER WHICH PROCESSING THE INTIMATION UNDER SECTION 200A OF THE ACT COULD CHARGE LATE FEE UNDER THE PROVISIONS OF SECTION 234 E OF THE ACT. THE ASSESSEE CLAIMS THAT THE ASSESSING OFFICER AT BEST COULD CHARGE THE DIFFERENCE IN TAX DEDUCTED AND NOT PAID IN TREASURY FROM THE DEDUCTOR AND / OR ANY INTEREST PAYABLE ON SUCH DEDUCTION OF TAX AT SOURCE. HOWEVER, TILL SUBSTITUTION OF CLAUSE (C) TO SECTION 200A(1) OF THE ACT BY THE FINANCE ACT, 2015 W.E.F. 01.06.2015, THE ASSESS ING OFFICER WAS NOT EMPOWERED TO CHARGE FEES UNDER SECTION 234E OF THE ACT. THE CASE OF REVENUE ON THE OTHER HAND, WAS THAT IT WAS THE D UTY OF DEDUCTOR WHILE FURNISHING THE STATEMENT UNDER SECTION 200(3) OF THE ACT TO DEPOSIT THE FEES REFERRED TO IN SECTION 234E(1) OF THE ACT. THE LEARNED CIT-DR STRESSED THAT FEES REFERRED TO IN SUB-SECTIO N (1) HAD TO BE PAID WHILE DELIVERING OR CAUSING TO DELIVER THE STATEMEN T IN ACCORDANCE WITH PROVISIONS OF SECTION 200(3) OF THE ACT OR THE PROVISO TO SECTION 206C(3) OF THE ACT. HOWEVER, VARIOUS REGULATIONS AN D THE STATUTORY PROVISIONS IN THIS REGARD POINT OUT THAT UNDOUBTEDL Y, THE RESPONSIBILITY OF THE DEDUCTOR WAS TO DEPOSIT THE TAX DEDUCTED AT SOURCE IN TIME AND IF NOT SO, THEN WITH INTEREST AND CONSEQUENTLY, WHE RE THE TAX WAS NOT PAID IN TIME AND INTEREST WAS NOT PAID IN TIME AND THEN, WHERE THE STATEMENT OF TAX DEDUCTED AT SOURCE COULD NOT BE FI LED BEFORE THE ITA NOS. 4740, 4741 & 4742/MUM/2016 ASIAN PIPES & PROFILES & DISHA DISTRIBUTORS 10 PRESCRIBED AUTHORITY WITHIN STIPULATED TIME, THE AS SESSEE WAS LIABLE TO LEVY OF FEES UNDER SECTION 234E OF THE ACT. HOWEVER , IN CASE ANY DEFAULT OCCURS DUE TO THE NON-PAYMENT OF FEES BY TH E ASSESSEE IN THIS REGARD, THEN THE PROVISIONS WHICH HAS TO BE CONSIDE RED IS SECTION 200A(1)(C) OF THE ACT. THE POWER TO CHARGE / COLLEC T FEES AS PER PROVISIONS OF SECTION 234E OF THE ACT WAS VESTED WI TH THE PRESCRIBED AUTHORITY UNDER THE ACT ONLY ON SUBSTITUTION OF EAR LIER CLAUSE (C) TO SECTION 200A OF THE ACT BY THE FINANCE ACT, 2015 W. E.F. 01.06.2015. ONCE ANY PROVISION OF THE ACT HAS BEEN MADE APPLICA BLE FROM A RESPECTIVE DATE, THEN THE REQUIREMENT OF THE STATUT E IS TO APPLY THE SAID PROVISIONS FROM THE SAID DATE. 24. IN RESPECT OF THE ISSUE RAISED BEFORE US, IT IS CLEAR THAT THE PRESCRIBED AUTHORITY HAS BEEN VESTED WITH THE POWER TO CHARGE FEES UNDER SECTION 234E OF THE ACT ONLY WITH REGARD TO L EVY OF FEES BY THE SUBSTITUTION MADE BY FINANCE (NO.2) ACT, 2015 W.E.F . 01.06.2015. ONCE THE POWER HAS BEEN GIVEN, UNDER WHICH ANY LEVY HAS TO BE IMPOSED UPON TAX PAYER, THEN SUCH POWER COMES INTO EFFECT FROM THE DATE OF SUBSTITUTION AND CANNOT BE APPLIED RETROSPE CTIVELY. THE SAID EXERCISE OF POWER HAS BEEN PROVIDED BY THE STATUTE TO BE FROM 01.06.2015 AND HENCE, IS TO BE APPLIED PROSPECTIVEL Y. THERE IS NO MERIT IN THE CLAIM OF REVENUE THAT EVEN WITHOUT INS ERTION OF CLAUSE (C) UNDER SECTION 200A(1) OF THE ACT, IT WAS INCUMBENT UPON THE ASSESSEE TO PAY FEES, IN CASE THERE IS DEFAULT IN FURNISHING THE STATEMENT OF TAX DEDUCTED AT SOURCE. ADMITTEDLY, THE ONUS WAS UPON T HE ASSESSEE TO PREPARE STATEMENTS AND DELIVER THE SAME WITHIN PRES CRIBED TIME BEFORE THE PRESCRIBED AUTHORITY, BUT THE POWER TO C OLLECT THE FEES BY THE PRESCRIBED AUTHORITY VESTED IN SUCH AUTHORITY O NLY BY WAY OF SUBSTITUTION OF CLAUSE (C) TO SECTION 200A(1) OF TH E ACT BY THE FINANCE ACT, 2015 W.E.F. 01.06.2015. PRIOR TO SAID SUBSTATI ON, THE ASSESSING OFFICER HAD NO AUTHORITY TO CHARGE THE FEES UNDER S ECTION 234E OF THE ACT WHILE ISSUING INTIMATION UNDER SECTION 200A OF THE ACT. BEFORE EXERCISING THE AUTHORITY OF CHARGING ANY SUM FROM A NY DEDUCTOR OR THE ASSESSEE, THE PRESCRIBED AUTHORITY SHOULD HAVE NECE SSARY POWER VESTED IN IT AND BEFORE VESTING OF SUCH POWER, NO O RDER CAN BE PASSED BY THE PRESCRIBED AUTHORITY IN CHARGING OF SUCH FEE S UNDER SECTION 234E OF THE ACT, WHILE EXERCISING JURISDICTION UNDE R SECTION 200A OF THE ACT. THUS, IN THE ABSENCE OF ENABLING PROVISION S, UNDER WHICH THE PRESCRIBED AUTHORITY IS EMPOWERED TO CHARGE THE FEE S, THE ASSESSING OFFICER WHILE PROCESSING THE RETURNS FILED BY THE D EDUCTOR IN RESPECT OF TAX DEDUCTED AT SOURCE CAN RAISE THE DEMAND ON ACCO UNT OF TAXES, IF ANY, NOT DEPOSITED AND CHARGE INTEREST. HOWEVER, PR IOR TO 01.06.2015, THE ASSESSING OFFICER DOES NOT HAVE THE POWER TO CH ARGE FEES UNDER SECTION 234E OF THE ACT WHILE PROCESSING TDS RETURN S. IN THE ABSENCE OF ENABLING PROVISIONS, LEVY OF FEES COULD NOT BE E FFECTED IN THE COURSE OF INTIMATION ISSUED UNDER SECTION 200A OF THE ACT PRIOR TO 01.06.2015. 25. THE AMRITSAR BENCH OF TRIBUNAL IN SIBIA HEALTHC ARE (P) LTD. VS. DCIT (2015) 121 DTR 81 (ASR) (TRIB) HAD HELD THAT T HE ADJUSTMENT IN ITA NOS. 4740, 4741 & 4742/MUM/2016 ASIAN PIPES & PROFILES & DISHA DISTRIBUTORS 11 RESPECT OF LEVY OF FEES UNDER SECTION 234E OF THE A CT WAS INDEED BEYOND THE SCOPE OF PERMISSIBLE ADJUSTMENTS CONTEMP LATED UNDER SECTION 200A OF THE ACT. SUCH A LEVY COULD NOT BE E FFECTED IN THE COURSE OF INTIMATION UNDER SECTION 200A OF THE ACT AND IN THE ABSENCE OF ANY OTHER PROVISIONS ENABLING THE DEMAND IN RESP ECT OF THIS LEVY HAVING BEEN POINTED OUT, NO SUCH LEVY COULD BE EFFE CTED. THE SAID PROPOSITION HAS BEEN APPLIED IN VARIOUS DECISIONS O F DIFFERENT BENCHES OF TRIBUNAL. REFERENCE WAS MADE TO THE DECISIONS OF CHENNAI BENCH OF TRIBUNAL IN G. INDIRANI VS. DCIT (SUPRA), AHMEDABAD BENCH OF TRIBUNAL IN M/S. GLOBE ECOLOGISTICS LTD. VS. DCIT I N ITA NOS.2689- 2691/AHD/2015, ITA NO.2692/AHD/2015, RELATING TO AS SESSMENT YEAR 2014-15, ITA NO.2693/AHD/2015, RELATING TO ASS ESSMENT YEAR 2013-14 AND ITA NOS.2694-2695/AHD/2014, RELATING TO ASSESSMENT YEAR 2013-14, VIDE CONSOLIDATED ORDER DATED 26.11.2 015 AND CHANDIGARH BENCH OF TRIBUNAL IN M/S. KHANNA WATCHES LTD. VS. DCIT IN ITA NOS.731 TO 735/CHD/2015, RELATING TO ASSESSM ENT YEARS 2014-15 & 2013-14, ORDER DATED 29.10.2015. 26. WHILE DECIDING THE PRESENT BUNCH OF APPEALS, TH E REVENUE HAD PLACED RELIANCE ON THE RATIO LAID DOWN BY THE HONB LE BOMBAY HIGH COURT IN RASHMIKANT KUNDALIA VS. UNION OF INDIA (SU PRA) WHEREIN, THE CONSTITUTIONAL VALIDITY OF SECTION 234E OF THE ACT WAS CHALLENGED. THE HONBLE HIGH COURT NOTED THE FACT THAT WHERE THE DE DUCTOR WAS REQUIRED TO FURNISH PERIODICAL QUARTERLY STATEMENTS CONTAINING THE DETAILS OF DEDUCTION OF TAX MADE DURING THE QUARTER , BY THE PRESCRIBED DUE DATE AND THE DELAY IN FURNISHING SUCH TDS RETUR NS WOULD HAVE CASCADING EFFECT. IT WAS FURTHER OBSERVED BY THE HO NBLE HIGH COURT THAT UNDER THE INCOMETAX ACT, WHERE THERE IS AN OBL IGATION ON THE INCOME-TAX DEPARTMENT TO PROCESS THE INCOME-TAX RET URNS WITHIN SPECIFIED PERIOD FROM THE DATE OF FILING, THE RETUR NS COULD NOT BE ACCURATELY PROCESSED OF SUCH PERSON ON WHOSE BEHALF TAX HAS BEEN DEDUCTED I.E. DEDUCTEE, UNTIL INFORMATION OF SUCH D EDUCTIONS IS FURNISHED BY THE DEDUCTOR WITHIN THE PRESCRIBED TIM E. SINCE THE SUBSTANTIAL NUMBER OF DEDUCTORS WERE NOT FILING THE IR TDS RETURNS / STATEMENTS WITHIN PRESCRIBED TIME FRAME, THEN IT LE AD TO AN ADDITIONAL WORK BURDEN UPON THE DEPARTMENT DUE TO THE FAULT OF THE DEDUCTOR AND IN THIS LIGHT AND TO COMPENSATE FOR ADDITIONAL WORK BURDEN FORCED UPON THE DEPARTMENT, FEES WAS SOUGHT TO BE LEVIED U NDER SECTION 234E OF THE ACT. THE HONBLE HIGH COURT HELD THAT L OOKING AT THIS FROM THIS PERSPECTIVE, SECTION 234E OF THE ACT WAS NOT P UNITIVE IN NATURE BUT A FEE WHICH WAS A FIXED CHARGE FOR THE EXTRA SE RVICE WHICH THE DEPARTMENT HAD TO PROVIDE DUE TO THE LATE FILING OF TDS STATEMENTS. IT WAS FURTHER HELD BY THE HONBLE HIGH COURT THAT LAT E FILING OF TDS RETURNS / STATEMENTS WAS REGULARIZED BY PAYMENT OF FEES AS SET OUT IN SECTION 234E OF THE ACT. THEREFORE, THE FINDINGS OF HONBLE HIGH COURT WERE THUS, THAT THE FEES SOUGHT TO BE LEVIED UNDER SECTION 234E OF THE ACT WAS NOT IN THE GUISE OF TAX SOUGHT TO BE LEVIED ON THE DEDUCTOR. THE PROVISIONS OF SECTION 234E OF THE ACT WERE HELD TO BE NOT ONEROUS ON THE GROUND THAT SECTION DOES NOT EMPOWER THE ASS ESSING OFFICER TO CONDONE THE DELAY IN LATE FILING THE INCOME TAX RET URNS OR THAT NO ITA NOS. 4740, 4741 & 4742/MUM/2016 ASIAN PIPES & PROFILES & DISHA DISTRIBUTORS 12 APPEAL IS PROVIDED FROM ARBITRARY ORDER PASSED UNDE R SECTION 234E OF THE ACT. THE HONBLE HIGH COURT HELD THAT THE RIGHT TO APPEAL WAS NOT A MATTER OF RIGHT BUT WAS CREATURE OF STATUTE AND I F THE LEGISLATURE DEEMS FIT NOT TO PROVIDE REMEDY OF APPEAL, SO BE IT . THE HONBLE HIGH COURT FURTHER HELD THAT A PERSON CAN ALWAYS APPROAC H THE COURT IN EXTRAORDINARY EQUITABLE JURISDICTION UNDER ARTICLE 226/227 OF THE CONSTITUTION AS THE CASE MAY BE. THE HONBLE HIGH C OURT THEREFORE, OBSERVED THAT SIMPLY BECAUSE NO REMEDY OF APPEAL WA S PROVIDED FOR THE PROVISIONS OF SECTION 234E OF THE ACT, THE SAME CANNOT BE SAID TO BE ONEROUS AND SECTION 234E OF THE ACT WAS HELD TO BE CONSTITUTIONALLY VALID. THE CONSTITUTIONAL VALIDITY OF PROVISIONS OF SECTION 234E OF THE ACT HAS ALSO BEEN UPHELD BY THE HONBLE RAJASTHAN H IGH COURT IN M/S. DUNDLOD SHIKSHAN SANSTHAN & ANR. VS. UNION OF INDIA AND ORS (SUPRA). 27. IN VIEW OF THE ABOVE SAID RATIO LAID DOWN BY TH E HONBLE BOMBAY HIGH COURT, THE CASE OF THE LEARNED CIT-DR BEFORE U S WAS THAT THERE IS NO MERIT IN THE PRESENT SET OF APPEALS FILED BY THE ASSESSEE AS THE HONBLE HIGH COURT HAS LAID DOWN THAT NO APPEAL IS PROVIDED FROM AN ORDER PASSED UNDER SECTION 234E OF THE ACT AND THE SAME MERITS TO BE DISMISSED AT THE OUTSET. IN THIS REGARD, HE HAS RAI SED TWO ISSUES THAT (A) THE APPEAL FILED BY THE ASSESSEE IS NOT MAINTAI NABLE AND ALSO (B) THERE IS NO MERIT IN THE CLAIM OF THE ASSESSEE THAT THE ASSESSING OFFICER IS NOT EMPOWERED TO CHARGE FEES UNDER SECTI ON 234E OF THE ACT BEFORE INSERTION OF CLAUSE (C) TO SECTION 200A(1) O F THE ACT BY THE FINANCE ACT, 2015 W.E.F. 01.06.2015. THE LEARNED AU THORIZED REPRESENTATIVE FOR THE ASSESSEE ON THE OTHER HAND, DREW OUR ATTENTION TO THE MEMORANDUM TO THE FINANCE BILL, 2015 WHILE I NTRODUCING THE SAID CLAUSE (C) TO SECTION 200A(1) OF THE ACT. THE FINANCE BILL TOOK NOTE OF THE PROVISIONS OF CHAPTER XVIIB, UNDER WHICH THE PERSON DEDUCTING TAX I.E. DEDUCTOR WAS REQUIRED TO FILE QUARTERLY TA X DEDUCTION AT SOURCE STATEMENT CONTAINING THE DETAILS OF DEDUCTION OF TA X MADE DURING THE QUARTER BY THE PRESCRIBED DUE DATES. SIMILAR RESPON SIBILITY IS ON A PERSON REQUIRED TO COLLECT TAX OF CERTAIN SPECIFIED RECEIPTS UNDER SECTION 206C OF THE ACT. IN ORDER TO PROVIDE EFFECT IVE DETERRENCE AGAINST THE DELAY IN FURNISHING TDS / TCS STATEMENT S, THE FINANCE ACT, 2012 INSERTED SECTION 234E OF THE ACT TO PROVI DE FOR LEVY OF FEES ON LATE FURNISHING OF TDS / TCS STATEMENTS. THE MEM O FURTHER TOOK NOTE OF THE FACT THAT THE FINANCE (NO.2) ACT, 2009 INSERTED SECTION 200A IN THE ACT, WHICH PROVIDED FOR FURNISHING OF T DS STATEMENTS FOR DETERMINING THE AMOUNT PAYABLE OR REFUNDABLE TO THE DEDUCTOR. IT FURTHER TOOK NOTE THAT HOWEVER, AS SECTION 234E OF THE ACT WAS INSERTED AFTER THE INSERTION OF SECTION 200A IN THE ACT, THE EXISTING PROVISIONS OF SECTION 200A OF THE ACT DOES NOT PROV IDE FOR DETERMINATION OF FEES PAYABLE UNDER SECTION 234E OF THE ACT AT THE TIME OF PROCESSING OF TDS STATEMENTS. IT WAS THUS, PROPOSED TO AMEND THE PROVISIONS OF SECTION 200A OF THE ACT SO AS TO ENABLE THE COMPUTATION OF FEES PAYABLE UNDER SECTION 234E OF T HE ACT AT THE TIME OF PROCESSING OF TDS STATEMENTS UNDER SECTION 200A OF THE ACT. THE MEMO EXPLAINING THE FINANCE BILL, 2015 VERY CATEGOR ICALLY HELD THAT ITA NOS. 4740, 4741 & 4742/MUM/2016 ASIAN PIPES & PROFILES & DISHA DISTRIBUTORS 13 CURRENTLY THERE DOES NOT EXIST ANY PROVISION IN THE ACT TO ENABLE THE PROCESSING OF TCS RETURNS AND HENCE, A PROPOSAL WAS MADE TO INSERT A PROVISION IN THIS REGARD AND ALSO THE POST PROVISIO N SHALL INCORPORATE THE MECHANISM FOR COMPUTATION OF FEES PAYABLE UNDER SECTION 234E OF THE ACT. THE FINANCE BILL FURTHER REFERS TO THE EXI STING PROVISIONS OF THE ACT I.E. AFTER PROCESSING OF TDS STATEMENT, INTIMAT ION IS GENERATED SPECIFYING THE AMOUNT PAYABLE OR REFUNDABLE. THIS I NTIMATION GENERATED AFTER PROCESSING OF TDS STATEMENT IS (I) SUBJECT TO RECTIFICATION UNDER SECTION 154 OF THE ACT; (II) AP PEALABLE UNDER SECTION 246A OF THE ACT; AND (III) DEEMED AS NOTICE OF PAYM ENT UNDER SECTION 156 OF THE ACT. THE FINANCE BILL FURTHER PROVIDED T HAT INTIMATION GENERATED AFTER THE PROPOSED PROCESSING OF TCS STAT EMENT SHALL BE AT PAR WITH THE INTIMATION GENERATED AFTER PROCESSING OF TDS STATEMENT AND ALSO PROVIDED THAT FAILURE TO PAY TAX SPECIFIED IN THE INTIMATION SHALL ATTRACT LEVY OF INTEREST AS PER PROVISIONS OF SECTION 220(2) OF THE ACT. FURTHER, AMENDMENTS WERE ALSO MADE IN RESPECT OF THE SCHEME OF PAYMENT OF TDS / TCS BY THE GOVERNMENT, DEDUCTOR / COLLECTOR WHICH ARE NOT RELEVANT FOR DECIDING THE ISSUE IN THE PRES ENT APPEAL AND HENCE, THE SAME ARE NOT BEING REFERRED TO. THE FINA NCE BILL FURTHER PROVIDED THAT THE AMENDMENT WOULD TAKE EFFECT FROM 01.06.2015. 28. THE PERUSAL OF MEMO EXPLAINING THE PROVISION RE LATING TO INSERTION OF CLAUSE (C) TO SECTION 200A OF THE ACT CLARIFIES THE INTENTION OF LEGISLATURE IN INSERTING THE SAID PROVISION. THE PR OVISIONS OF SECTION 234E OF THE ACT WERE INSERTED BY THE FINANCE ACT, 2 012, UNDER WHICH THE PROVISION WAS MADE FOR LEVY OF FEES FOR LATE FU RNISHING TDS / TCS STATEMENTS. BEFORE INSERTION OF SECTION 234E OF THE ACT, THE FINANCE (NO.2) ACT, 2009 HAD INSERTED SECTION 200A IN THE A CT, UNDER THE SAID SECTION, MECHANISM WAS PROVIDED FOR PROCESSING OF T DS STATEMENTS FOR DETERMINING THE AMOUNT PAYABLE OR REFUNDABLE TO THE DEDUCTOR, UNDER WHICH THE PROVISION WAS ALSO MADE FOR CHARGIN G OF INTEREST. HOWEVER, SINCE THE PROVISIONS OF SECTION 234E OF TH E ACT WERE NOT ON STATUTE WHEN THE FINANCE (NO.2) ACT, 2009 WAS PASSE D, NO PROVISION WAS MADE FOR DETERMINING THE FEES PAYABLE UNDER SEC TION 234E OF THE ACT AT THE TIME OF PROCESSING THE TDS STATEMENTS. S O, WHEN SECTION 234E OF THE ACT WAS INTRODUCED, IT PROVIDED THAT TH E PERSON WAS RESPONSIBLE FOR FURNISHING THE TDS RETURNS / STATEM ENTS WITHIN STIPULATED PERIOD AND IN DEFAULT, FEES WOULD BE CHA RGED ON SUCH PERSON. THE SAID SECTION ITSELF PROVIDED THAT FEES SHALL NOT EXCEED THE AMOUNT OF TAX DEDUCTED AT SOURCE OR COLLECTED AT SO URCE. IT WAS FURTHER PROVIDED THAT THE PERSON RESPONSIBLE FOR FURNISHING THE STATEMENTS SHALL PAY THE SAID AMOUNT WHILE FURNISHING THE STAT EMENTS UNDER SECTION 200(3) OF THE ACT. HOWEVER, POWER ENABLING THE ASSESSING OFFICER TO CHARGE / LEVY THE FEE UNDER SECTION 234E OF THE ACT WHILE PROCESSING THE TDS RETURNS / STATEMENTS FILED BY A PERSON DID NOT EXIST WHEN SECTION 234E OF THE ACT WAS INSERTED BY THE FINANCE ACT, 2012. THE POWER TO CHARGE FEES UNDER THE PROVISIONS OF SECTION 234E OF THE ACT WHILE PROCESSING THE TDS STATEMENTS, WAS DWELLED UPON BY THE LEGISLATURE BY WAY OF INSERTION OF CLAUSE (C) T O SECTION 200A(1) OF THE ACT BY THE FINANCE ACT, 2015 W.E.F. 01.06.2015. ACCORDINGLY, WE ITA NOS. 4740, 4741 & 4742/MUM/2016 ASIAN PIPES & PROFILES & DISHA DISTRIBUTORS 14 HOLD THAT WHERE THE ASSESSING OFFICER HAS PROCESSED THE TDS STATEMENTS FILED BY THE DEDUCTOR, WHICH ADMITTEDLY, WERE FILED BELATEDLY BUT BEFORE INSERTION OF CLAUSE (C) TO SEC TION 200A(1) OF THE ACT W.E.F. 01.06.2015, THEN IN SUCH CASES, THE ASSESSIN G OFFICER IS NOT EMPOWERED TO CHARGE FEES UNDER SECTION 234E OF THE ACT WHILE PROCESSING THE TDS RETURNS FILED BY THE DEDUCTOR. 29. THE HONBLE BOMBAY HIGH COURT IN RASHMIKANT KUN DALIA VS. UNION OF INDIA (SUPRA) HAS UPHELD THE CONSTITUTIONA L VALIDITY OF SAID SECTION INTRODUCED BY THE FINANCE ACT, 2015 W.E.F. 01.06.2015 BUT WAS NOT ABREAST OF THE APPLICABILITY OF THE SAID SE CTION 234E OF THE ACT BY THE ASSESSING OFFICER WHILE PROCESSING TDS STATE MENT FILED BY THE DEDUCTOR PRIOR TO 01.06.2015. IN SUCH SCENARIO, WE FIND NO MERIT IN THE PLEA OF LEARNED CIT-DR THAT THE HONBLE BOMBAY HIGH COURT IN RASHMIKANT KUNDALIA VS. UNION OF INDIA (SUPRA) HAS LAID DOWN THE PROPOSITION THAT FEES UNDER SECTION 234E OF THE ACT IS CHARGEABLE IN THE CASE OF PRESENT SET OF APPEALS, WHERE THE ASSES SING OFFICER HAD ISSUED THE INTIMATION UNDER SECTION 200A OF THE ACT PRIOR TO 01.06.2015. 30. ANOTHER ASPECT OF THE ISSUE IS WHETHER THE AMEN DMENT BROUGHT IN BY THE FINANCE ACT, 2015 W.E.F. 01.06.2015 BY WAY O F INSERTION OF CLAUSE (C) TO SECTION 200A(1) OF THE ACT IS CLARIFI CATORY OR IS PROSPECTIVE IN NATURE AND IS NOT APPLICABLE TO THE PENDING ASSE SSMENTS. UNDOUBTEDLY, THE PROVISIONS OF SECTION 234E OF THE ACT WERE INSERTED BY THE FINANCE ACT, 2012, UNDER WHICH THE LIABILITY WAS IMPOSED UPON THE DEDUCTOR IN SUCH CASES WHERE TDS STATEMENTS / R ETURNS WERE FILED BELATEDLY TO PAY THE FEES AS PER SAID SECTION. HOWE VER, IN CASES, WHERE THE ASSESSEE HAS FAILED TO DEPOSIT THE SAID F EES, THEN IN ORDER TO ENABLE THE ASSESSING OFFICER TO COLLECT THE SAID FEES CHARGEABLE UNDER SECTION 234E OF THE ACT, IT IS INCUMBENT UPON THE LEGISLATURE TO PROVIDE MECHANISM FOR THE ASSESSING OFFICER TO CHAR GE AND COLLECT SUCH FEES. IN THE ABSENCE OF ENABLING PROVISIONS, T HE ASSESSING OFFICER WHILE PROCESSING THE TDS STATEMENTS, EVEN IF THE SA ID STATEMENTS ARE BELATED, IS NOT EMPOWERED TO CHARGE THE FEES UNDER SECTION 234E OF THE ACT. THE AMENDMENT WAS BROUGHT IN BY THE FINANC E ACT, 2015 W.E.F. 01.06.2015 AND SUCH AN AMENDMENT WHERE EMPOW ERMENT IS GIVEN TO THE ASSESSING OFFICER TO LEVY OR CHARGE TH E FEES CANNOT BE SAID TO BE CLARIFICATORY IN NATURE AND HENCE, APPLI CABLE FOR PENDING ASSESSMENTS. 31. THE HONBLE SUPREME COURT IN CIT VS. VATIKA TOW NSHIP PVT. LTD. (SUPRA) HAS EXPLAINED THE GENERAL PRINCIPLE CONCERN ING RETROSPECTIVITY AND HAVE HELD THAT OF THE VARIOUS RULES GUIDING HO W A LEGISLATION HAS TO BE INTERPRETED, ONE ESTABLISHED RULE IS THAT UNL ESS CONTRARY INTENTION APPEARS, A LEGISLATION IS PRESUMED NOT TO BE INTENDED TO HAVE A RETROSPECTIVE OPERATION. IDEA BEHIND THE RUL E IS THAT CURRENT LAW SHOULD GOVERN CURRENT ACTIVITIES. THE MEMO EXP LAINING THE FINANCE BILL, 2015 VERY CLEARLY ALSO RECOGNIZES THA T AND REFERS TO THE CURRENT PROVISIONS OF SUB-SECTION (3) TO SECTION 20 0 OF THE ACT, UNDER WHICH THE DEDUCTOR IS TO FURNISH TDS STATEMENTS. HO WEVER, AS SECTION ITA NOS. 4740, 4741 & 4742/MUM/2016 ASIAN PIPES & PROFILES & DISHA DISTRIBUTORS 15 234E OF THE ACT WAS INSERTED AFTER INSERTION OF SEC TION 200A IN THE ACT, THE EXISTING PROVISIONS OF SECTION 200A OF THE ACT DID NOT PROVIDE FOR DETERMINATION OF FEES PAYABLE UNDER SECTION 234 E OF THE ACT AT THE TIME OF PROCESSING OF TDS STATEMENTS. IN THIS REGAR D, IT WAS THUS, PROPOSED TO AMEND THE PROVISIONS OF SECTION 200A OF THE ACT SO AS TO ENABLE THE COMPUTATION OF FEES PAYABLE UNDER SECTIO N 234E OF THE ACT AT THE TIME OF PROCESSING OF TDS STATEMENTS UNDER S ECTION 200A OF THE ACT. IN OTHER WORDS, THE ASSESSING OFFICER IS EMPOW ERED TO CHARGE FEES PAYABLE UNDER SECTION 234E OF THE ACT IN THE I NTIMATION ISSUED AFTER INSERTION OF CLAUSE (C) TO SECTION 200A(1) OF THE ACT W.E.F. 01.06.2015. THE LEGISLATURE ITSELF RECOGNIZED THAT UNDER THE EXISTING PROVISIONS OF SECTION 200A OF THE ACT I.E. PRIOR TO 01.06.2015, THE ASSESSING OFFICER AT THE TIME OF PROCESSING THE TDS STATEMENTS DID NOT HAVE POWER TO CHARGE FEES UNDER SECTION 234E OF THE ACT AND IN ORDER TO COVER UP THAT, THE AMENDMENT WAS MADE BY WAY OF INSERTION OF CLAUSE (C) TO SECTION 200A OF THE ACT. IN SUCH SCEN ARIO, IT CANNOT BE SAID THAT INSERTION MADE BY SECTION 200A(1)(C) OF T HE ACT IS RETROSPECTIVE IN NATURE, WHERE THE LEGISLATURE WAS AWARE THAT THE FEES COULD BE CHARGED UNDER SECTION 234E OF THE ACT AS PER FINANCE ACT, 2012 AND ALSO THE PROVISIONS OF SECTION 200A O F THE ACT WERE INSERTED BY FINANCE (NO.2) ACT, 2009, UNDER WHICH T HE MACHINERY WAS PROVIDED FOR THE ASSESSING OFFICER TO PROCESS THE T DS STATEMENTS FILED BY THE ASSESSEE. THE INSERTION CATEGORICALLY BEING MADE W.E.F. 01.06.2015 LAYS DOWN THAT THE SAID AMENDMENT IS PRO SPECTIVE IN NATURE AND CANNOT BE APPLIED TO PROCESSING OF TDS R ETURNS / STATEMENTS PRIOR TO 01.06.2015. 32. WE FURTHER FIND THAT IN RECENT JUDGMENT DATED 2 6.08.2016, THE HONBLE KARNATAKA HIGH COURT IN WRIT APPEAL NOS.266 3- 2674/2015(T-IT) & ORS IN SRI FATHERAJ SINGHVI & ORS VS. UNION OF INDIA & ORS HAS QUASHED THE INTIMATION ISSUED UNDER SECTION 200A OF THE ACT LEVYING THE FEES FOR DELAYED FILING THE TDS STATEMENTS UNDER SECTION 234E OF THE ACT. THE HONBLE HIGH COURT NOT ES THAT THE FINANCE ACT, 2015 HAD MADE AMENDMENTS TO SECTION 20 0A OF THE ACT ENABLING THE ASSESSING OFFICER TO MAKE ADJUSTMENTS WHILE LEVYING FEES UNDER SECTION 234E OF THE ACT WAS APPLICABLE W .E.F. 01.06.2015 AND HAS HELD THAT IT HAS PROSPECTIVE EFFECT. ACCORD INGLY, THE HONBLE HIGH COURT HELD THAT INTIMATION RAISING DEMAND PRI OR TO 01.06.2015 UNDER SECTION 200A OF THE ACT LEVYING SECTION 234E OF THE ACT LATE FEES IS NOT VALID. HOWEVER, THE HONBLE HIGH COURT KEPT OPEN THE ISSUE ON CONSTITUTIONAL VALIDITY OF SECTION 234E OF THE ACT. WE HAVE ALREADY REFERRED TO THE DECISION OF HONBLE BOMBAY HIGH COU RT IN RASHMIKANT KUNDALIA VS. UNION OF INDIA (SUPRA) IN THIS REGARD, WHEREIN THE CONSTITUTIONAL VALIDITY OF SECTION 234E OF THE ACT HAS BEEN UPHELD. 33. ACCORDINGLY, WE HOLD THAT THE AMENDMENT TO SECT ION 200A(1) OF THE ACT IS PROCEDURAL IN NATURE AND IN VIEW THEREOF, TH E ASSESSING OFFICER WHILE PROCESSING THE TDS STATEMENTS / RETURNS IN TH E PRESENT SET OF APPEALS FOR THE PERIOD PRIOR TO 01.06.2015, WAS NOT EMPOWERED TO CHARGE FEES UNDER SECTION 234E OF THE ACT. HENCE, T HE INTIMATION ITA NOS. 4740, 4741 & 4742/MUM/2016 ASIAN PIPES & PROFILES & DISHA DISTRIBUTORS 16 ISSUED BY THE ASSESSING OFFICER UNDER SECTION 200A OF THE ACT IN ALL THESE APPEALS DOES NOT STAND AND THE DEMAND RAISED BY WAY OF CHARGING THE FEES UNDER SECTION 234E OF THE ACT IS NOT VALID AND THE SAME IS DELETED. THE INTIMATION ISSUED BY THE ASSES SING OFFICER WAS BEYOND THE SCOPE OF ADJUSTMENT PROVIDED UNDER SECTI ON 200A OF THE ACT AND SUCH ADJUSTMENT COULD NOT STAND IN THE EYE OF LAW. 34. BEFORE PARTING WE MAY REFER TO RELIANCE PLACED UPON BY THE LEARNED CIT-DR ON THE RATIO LAID DOWN BY CHENNAI BE NCH OF TRIBUNAL IN G. INDIRANI VS. DCIT (SUPRA) ON ANOTHER ASPECT W HEREIN IT WAS HELD THAT BEFORE 01.06.2015, WHETHER THE ASSESSING OFFIC ER HAD AUTHORITY TO PASS A SEPARATE ORDER UNDER SECTION 234E OF THE ACT LEVYING FEES FOR DELAY IN FILING THE TDS STATEMENTS UNDER SECTIO N 200(3) OF THE ACT; THE TRIBUNAL HELD YES THAT THE ASSESSING AUTHORIT Y HAD SUCH POWER AND AFTER 01.06.2015, THE ASSESSING OFFICER WAS WIT HIN HIS LIMIT TO LEVY FEES UNDER SECTION 234E OF THE ACT EVEN WHILE PROCESSING THE TDS STATEMENTS UNDER SECTION 200A OF THE ACT. IN VIEW O F THE PRESENT SET OF FACTS, WHERE THE ASSESSING OFFICER HAD CHARGED FEES UNDER SECTION 234E OF THE ACT WHILE PROCESSING THE STATEMENTS UND ER SECTION 200A OF THE ACT BEFORE 01.06.2015, THERE IS NO MERIT IN THE RELIANCE PLACED UPON BY THE LEARNED CIT-DR ON THE SAID PROPOSITION LAID DOWN BY THE CHENNAI BENCH OF TRIBUNAL AND WE DISMISS THE SAME. 35. ANOTHER RELIANCE PLACED UPON BY THE LEARNED CIT -DR WAS IN RESPECT OF AMENDMENT BEING RETROSPECTIVE OR PROSPEC TIVE AND RELIANCE WAS PLACED ON THE RATIO LAID DOWN BY HONBLE DELHI HIGH COURT IN CIT VS. NARESH KUMAR (SUPRA). HOWEVER, IN VIEW OF OUR D ECISION IN THE PARAS HEREINABOVE, WHERE POWER IS BEING ENSHRINED U PON THE ASSESSING OFFICER TO LEVY OR CHARGE WHILE PROCESSIN G THE TDS RETURNS W.E.F. 01.06.2015, SUCH PROVISION CANNOT HAVE RETRO SPECTIVE EFFECT AS IT WOULD BE DETRIMENTAL TO THE CASE OF TAX PAYER. T HE HONBLE DELHI HIGH COURT WAS CONSIDERING THE APPLICATION OF AMEND MENT TO SECTION 40(A)(IA) OF THE ACT BY THE FINANCE ACT, 2010, UNDE R WHICH CERTAIN RELAXATIONS WERE GIVEN TO THE APPLICATION OF SAID S ECTION AND IT WAS HELD THAT THE SAME APPLIES RETROSPECTIVELY TO EARLI ER YEARS. HOWEVER, IN THE PRESENT SET OF APPEALS, THE ISSUE IS AGAINST THE PROVISION UNDER WHICH A NEW ENABLING POWER IS BEING GIVEN TO CHARGE FEES UNDER SECTION 234E OF THE ACT WHILE PROCESSING TDS RETURN S / STATEMENTS AND SUCH POWER IS TO BE APPLIED PROSPECTIVELY. IN A NY CASE, THE PARLIAMENT ITSELF HAS RECOGNIZED ITS OPERATION TO B E PROSPECTIVE IN NATURE WHILE INTRODUCING CLAUSE (C) TO SECTION 200A (1) OF THE ACT AND HENCE, CANNOT BE APPLIED RETROSPECTIVELY. SIMILARLY , RELIANCE PLACED UPON BY THE LEARNED CIT-DR ON THE RATIO LAID DOWN B Y THE HONBLE SUPREME COURT IN GOVINDDAS VS. ITO (SUPRA) IS MISPL ACED BECAUSE OF THE DISTINGUISHABLE FACTS AND ISSUES. 36. NOW, COMING TO THE CONNECTED ISSUE RAISED BY TH E LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE BY WAY O F GROUND OF APPEAL NO.1 THAT WHETHER ANY APPEAL IS MAINTAINABLE AGAINST THE INTIMATION ISSUED UNDER SECTION 200A OF THE ACT AND / OR ORDER PASSED UNDER SECTION 154 R.W.S. 200A OF THE ACT BY ASSESSI NG OFFICER IN ITA NOS. 4740, 4741 & 4742/MUM/2016 ASIAN PIPES & PROFILES & DISHA DISTRIBUTORS 17 CHARGING THE FEES UNDER SECTION 234E OF THE ACT. BO TH THE LEARNED AUTHORIZED REPRESENTATIVES HAVE RAISED VARIED ARGUM ENTS IN RESPECT OF SAID ISSUE AND THE LEARNED CITDR HAS REFERRED TO THE ORDER OF CIT(A), WHO HAD HELD THAT NO APPEAL IS MAINTAINABLE AGAINST THE ORDER OF ASSESSING OFFICER PASSED WHILE PROCESSING THE TD S RETURNS / STATEMENTS AND CHARGING OF FEES UNDER SECTION 234E OF THE ACT. WITHOUT GOING INTO VARIOUS ASPECTS OF THE ISSUE, WE MAKE REFERENCE TO THE MEMORANDUM EXPLAINING THE FINANCE BILL, 2015, U NDER WHICH THE HEADING WAS RATIONALIZATION OF PROVISIONS RELATING TO TAX DEDUCTION AT SOURCE (TDS) AND TAX COLLECTION AT SOURCE (TCS). TH E SAID MEMORANDUM CATEGORICALLY RECOGNIZED THAT UNDER THE EXISTING PROVISIONS OF THE ACT, AFTER PROCESSING OF TDS STAT EMENTS, AN INTIMATION IS GENERATED SPECIFYING THE AMOUNT PAYAB LE OR REFUNDABLE. IT WAS FURTHER NOTED THAT THIS INTIMATION GENERATED AFTER PROCESSING TDS STATEMENT IS (I) SUBJECT TO RECTIFICATION UNDER SECTION 154 OF THE ACT; (II) APPEALABLE UNDER SECTION 246A OF THE ACT; AND (III) DEEMED AS NOTICE OF PAYMENT UNDER SECTION 156 OF THE ACT. UND ER THE AMENDMENT, SIMILAR POSITION WAS GIVEN TO THE PROCES SING OF TCS STATEMENTS. IN OTHER WORDS, THE LEGISLATURE RECOGNI ZES THAT A DEDUCTOR WHO HAS FILED HIS STATEMENT OF TAX DEDUCTED AT SOUR CE, WHICH IN TURN, HAS BEEN PROCESSED BY THE ASSESSING OFFICER AND INT IMATION IS GENERATED UNDER WHICH, IF ANY AMOUNT IS FOUND TO BE PAYABLE, THEN SUCH INTIMATION GENERATED AFTER PROCESSING OF TDS R ETURNS IS SUBJECT TO RECTIFICATION UNDER SECTION 154 OF THE ACT AND / OR IS ALSO APPEALABLE UNDER SECTION 246A OF THE ACT, SINCE THE DEMAND ISS UED BY THE ASSESSING OFFICER IS DEEMED TO BE A NOTICE OF PAYME NT UNDER SECTION 156 OF THE ACT. SINCE THE INTIMATION IN QUESTION IS SUED BY THE ASSESSING OFFICER WAS APPEALABLE ORDER UNDER SECTIO N 246A(1)(A) OF THE ACT, THEREFORE, THE CIT(A) SHOULD HAVE EXAMINED THE LEGALITY OF ADJUSTMENT MADE UNDER INTIMATION ISSUED UNDER SECTI ON 200A OF THE ACT. THE CIT(A) HAS REJECTED THE PRESENT SET OF APP EALS ON THE SURMISE THAT FIRST OF ALL, NO APPEAL IS PROVIDED AGAINST TH E INTIMATION ISSUED UNDER SECTION 200A OF THE ACT. FURTHER, THE CIT(A) HAS ALSO DECIDED THE ISSUE ON MERITS AND THE ASSESSEE IS IN APPEAL B EFORE US ON BOTH THESE GROUNDS. VIS--VIS THE FIRST ISSUE OF MAINTAI NABILITY OF APPEAL AGAINST THE INTIMATION ISSUED UNDER SECTION 200A OF THE ACT, WE HOLD THAT SUCH INTIMATION ISSUED BY THE ASSESSING OFFICE R AFTER PROCESSING THE TDS RETURNS IS APPEALABLE. THE DEMAND RAISED BY WAY OF CHARGING OF FEES UNDER SECTION 234E OF THE ACT IS U NDER SECTION 156 OF THE ACT AND ANY DEMAND RAISED UNDER SECTION 156 OF THE ACT IS APPEALABLE UNDER SECTION 246A(1)(A) AND (C) OF THE ACT. ACCORDINGLY, WE REVERSE THE FINDINGS OF CIT(A) IN THIS REGARD. W E FIND SUPPORT FROM THE SIMILAR PROPOSITION BEING LAID DOWN BY MUMBAI B ENCH OF TRIBUNAL IN BUNCH OF CASES WITH LEAD ORDER IN M/S. KASH REAL TORS PVT. LTD. VS. ITO IN ITA NO.4199/M/2015, RELATING TO ASSESSMENT Y EAR 2013- 14, CONSOLIDATED ORDER DATED 27.07.2016, WHICH HAD ALSO DECIDED THE ISSUE OF CHARGING OF FEES UNDER SECTION 234E OF THE ACT IN FAVOUR OF THE ASSESSEE FOLLOWING THE DECISIONS OF OTHER BENCHES O F TRIBUNAL. ONCE INTIMATION ISSUED UNDER SECTION 200A(1) OF THE ACT IS APPEALABLE ORDER ITA NOS. 4740, 4741 & 4742/MUM/2016 ASIAN PIPES & PROFILES & DISHA DISTRIBUTORS 18 BEFORE THE CIT(A) UNDER SECTION 246A(1)(A) OF THE A CT, THEN SUCH APPEALABLE ORDER PASSED BY THE CIT(A) UNDER SECTION 250 OF THE ACT IS FURTHER APPEALABLE BEFORE THE TRIBUNAL UNDER SECTIO N 253 OF THE ACT. HENCE, WE ADMIT THE PRESENT APPEALS FILED BY THE AS SESSEE EVEN ON THIS PRELIMINARY ISSUE. WE HAVE ALREADY ADJUDICATED THE ISSUE OF CHARGING FEES UNDER SECTION 234E OF THE ACT BY THE ASSESSING OFFICER WHILE PROCESSING RETURNS / STATEMENTS IN THE PARAS HEREINABOVE AND IN VIEW THEREOF, WE HOLD THAT THE ASSESSING OFFICER IS NOT EMPOWERED TO CHARGE THE FEES UNDER SECTION 234E OF THE ACT BY WAY OF INTIMATION ISSUED UNDER SECTION 200A OF THE ACT IN RESPECT OF DEFAULTS BEFORE 01.06.2015, WE ALLOW THE CLAIM OF ASSESSEE ON BOTH THE ASPECTS. THE GROUNDS OF APPEAL RAISED BY THE ASSESSEE ARE THUS, ALLOWED. 37. IN THE RESULT, ALL THE APPEALS FILED BY DIFFERE NT ASSESSEES FOR DIFFERENT QUARTERS RELATING TO DIFFERENT YEARS ARE ALLOWED. 6.2 FOLLOWING THE ABOVE REFERRED DECISION OF THE HO N'BLE ITAT PUNE BENCH IN THE CASE OF GAJANAN CONSTRUCTIONS AND OTHE RS IN ITA NOS.1292 & 1293/PN/2015 AND OTHERS DATED 23.09.2016, WE HOLD T HAT THE AMENDMENT TO SECTION 200A(1) OF THE ACT IS PROSPECTIVE IN NAT URE AND THEREFORE THE AO WHILE PROCESSING THE TDS STATEMENTS/RETURNS IN THE PRESENT THREE APPEALS FOR THE PERIOD PRIOR TO 01.06.2015 WAS NOT EMPOWERE D TO CHARGE FEES UNDER SECTION 234E OF THE ACT. THEREFORE THE INTIMATIONS ISSUED BY THE AO UNDER SECTION 200A OF THE ACT IN THESE APPEALS ARE UNSUST AINABLE AND THE DEMAND RAISED BY WAY OF CHARGING OF THE FEES UNDER SECTION 234E OF THE ACT NOT BEING VALID IS DELETED. IN THIS VIEW OF THE MATTER, WE HOLD THAT THE AO IS NOT EMPOWERED TO CHARGE FEES UNDER SECTION 23 4E OF THE ACT BY WAY OF INTIMATIONS ISSUED UNDER SECTION 200A OF THE ACT IN RESPECT OF DEFAULTS BEFORE 01.06.2015 AND CONSEQUENTLY ALLOW THE GROUND OF ALL APPEALS RAISED BY THE ASSESSEES. 7. IN THE RESULT, THE ASSESSEES APPEAL FOR A.Y. 2013- 14, FOR THE DIFFERENT QUARTERS AS STATED THEREIN, ARE ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 1 ST MARCH, 2017. SD/ - SD/ - (SANJAY GARG) (JASON P. BOAZ) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI, DATED: 1 ST MARCH, 2017 ITA NOS. 4740, 4741 & 4742/MUM/2016 ASIAN PIPES & PROFILES & DISHA DISTRIBUTORS 19 COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A) -1, THANE 4. THE CIT (TDS), PUNE 5. THE DR, I BENCH, ITAT, MUMBAI BY ORDER //TRUE COPY// ASSISTANT REGISTRAR ITAT, MUMBAI BENCHES, MUMBAI N.P.