Absterge Acme Filters I P Ltd, Aurangabad V. Assistant Commissioner of Income-Tax, TDS (AO), Ghaziabad

ITA 509/PUN/2021

• Counselvise Citation: [2022] 106 COUNSELVISE.COM (IT) 9545 (ITAT-PUNE)
• Duration Of Justice: 8 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-07-2022
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: misc
• Appeal Filed On: 17-10-2021
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Retrospective amendment; TDS; Set aside
• Section: 154; 234E; 200A; 272A

Judgement Text

आयकर अपीलीय अिधकरण “ए” Ɋायपीठ पुणे मŐ। IN THE INCOME TAX APPELLATE TRIBUNAL “A” BENCH, PUNE BEFORE SHRI S.S.GODARA, JUDICIAL MEMBER AND DR. DIPAK P. RIPOTE, ACCOUNTANT MEMBER आयकरअपीलसं. / ITA No.509/PUN/2021 िनधाᭅरणवषᭅ / Assessment Year : 2015-16 Absterge ACME Filters India Private Limited, Plot No.9, Sarang Society, Garkheda Road, Garkhe Area, Aurangabad – 431005. PAN: AABCC 6133 C Vs The Assistant Commissioner of Income Tax, CPC, TDS, (A.O.), Ghaziabad. Appellant/ Assessee Respondent /Revenue Assessee by None. Revenue by Shri Arvind Desai– DR Date of hearing 23/06/2022 Date of pronouncement 07/07/2022 आदेश/ ORDER PER DR. DIPAK P. RIPOTE, AM: This appeal filed by the Assessee is directed against the order of National Faceless Appeal Centre(NFAC), Delhi for the Assessment Year 2015-16, dated 23.08.2021. The Assessee has raised the following grounds of appeal: “1. The ld CIT(A) erred in law and on facts in not condoning the delay in filing of appeal and dismissing the same without appreciating that there was a sufficient cause for delay. 2. The learned CIT(A) erred in law and on facts in confirming levy of fees u/s 234E Rs.8524/- for non-filing of TDS statement. 3. The learned CIT(A) erred in law and on facts in upholding order u/s.200A even though the Section did not provide for levy of fees u/s.234E for the relevant Assessment Year. 4. The appellant craves to add, alter, modify or substitute any ITA No.509/PUN/2021 for A.Y.2015-16 Absterge ACME Filters India Pvt. Ltd., vs. ACIT, CPC,TDS(AO), Ghaziabad (A) 2 ground of appeal at the time of hearing.” 3. Brief facts of the case are that the assessee is a private limited company. The assessee is required to deduct tax and file TDS Returns. Here there is delay in filing TDS Returns. The Assessing Officer levied late filing fees under section 234E of the income Tax Act. 4. Aggrieved by the order of the AO, the assessee filed appeal before the ld.Commissioner of Income Tax(Appeal). The ld.CIT(A) dismissed the appeal as according to ld.CIT(A) there was delay of 1799 days in filing of appeal. The ld.CIT(A) has further held that the delay is not condoned as no “sufficient cause” has been shown under section 249(3) of the Act, accordingly, the appeal sought to be instituted belatedly is hereby rejected. Therefore, the ld.CIT(A) did not condone the delay and dismissed the appeal. 5. The only issue involved is levy of late fee u/s.234E of the Act, for delay in submitting TDS statement. There is no dispute regarding delay in submitting the TDS statements. This issue is covered in favour of the assessee. The ITAT Pune in the case of Medical Superintendent Rural Hospital, vs. DCIT, CPC(TDS) [2018] 100 taxmann.com 78 (Pune Tribunal) has observed as under: “11. We have heard the rival contentions and perused the record. The issue arising in the present bunch of appeals is against levy of late filing fees under section 234E of the Act while issuing intimation under section 200A of the Act, in the first bunch of ITA No.509/PUN/2021 for A.Y.2015-16 Absterge ACME Filters India Pvt. Ltd., vs. ACIT, CPC,TDS(AO), Ghaziabad (A) 3 appeals. The second bunch of appeals in the case of Junagade Healthcare Pvt. Ltd. is against order of Assessing Officer passed under section 154 of the Act rejecting rectification application moved by assessee against intimation issued levying late filing fees charged under section 234E of the Act. The case of assessee before us is that the issue is squarely covered by various orders of Tribunal, wherein the issue has been decided in respect of levy of late filing fees under section 234E of the Act, in the absence of empowerment by the Act upon Assessing Officer to levy such fees while issuing intimation under section 200A of the Act. The Tribunal vide order dated 21.09.2016 with lead order in Maharashtra Cricket Association v. Dy. CIT [2016] 74 taxmann.com 6 (Pune - Trib.) relating to assessment years 2013-14 and 2014-15 for the respective quarters deliberated upon the issue and held as under: — "34. Accordingly, we hold that the amendment to section 200A(1) of the Act is procedural in nature and in view thereof, the Assessing Officer while processing the TDS statements / returns in the 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, the intimation 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 Assessing Officer was beyond the scope of adjustment provided under section 200A of the Act and such adjustment could not stand in the eye of law." 12. The said proposition has been applied in the next bunch of appeals with lead order in Vidya Vardhani Education & Research Foundation v. Dy. CIT [2017] 88 taxmann.com 894 (Pune - Trib.) and also in Swami Vivekanand Vidyalaya (supra) and Medical Superintendant Rural Hospital v. ACIT [IT Appeal Nos.2072 & 2073 (PUN) of 2017, order dated 21-12-2017], which has been relied upon by the learned Authorized Representative for the assessee. 13. The Hon'ble High Court of Karnataka in the case of Fatheraj Singhvi (supra) had also laid down similar proposition that the amendment to section 200A of the Act w.e.f. 01.06.2015 has prospective effect and is not applicable for the period of respective assessment years prior to 01.06.2015. The relevant findings of the Hon'ble High Court are in paras 21 and 22, which read as under:— "21. However, if Section 234E providing for fee was brought on the state book, keeping in view the aforesaid purpose and ITA No.509/PUN/2021 for A.Y.2015-16 Absterge ACME Filters India Pvt. Ltd., vs. ACIT, CPC,TDS(AO), Ghaziabad (A) 4 the intention then, the other mechanism provided for computation of fee and failure for payment of fee under Section 200A which has been brought about with effect from 1.6.2015 cannot be said as only by way of a regulatory mode or a regulatory mechanism but it can rather be termed as conferring substantive power upon the authority. It is true that, a regulatory mechanism by insertion of any provision made in the statute book, may have a retroactive character but, whether such provision provides for a mere regulatory mechanism or confers substantive power upon the authority would also be a aspect which may be required to be considered before such provisions is held to be retroactive in nature. Further, when any provision is inserted for liability to pay any tax or the fee by way of compensatory in nature or fee independently simultaneously mode and the manner of its enforceability is also required to be considered and examined. Not only that, but, if the mode and the manner is not expressly prescribed, the provisions may also be vulnerable. All such aspects will be required to be considered before one considers regulatory mechanism or provision for regulating the mode and the manner of recovery and its enforceability as retroactive. If at the time when the fee was provided under Section 234E, the Parliament also provided for its utility for giving privilege under Section 271H(3) that too by expressly put bar for penalty under Section 272A by insertion of proviso to Section 272A(2), it can be said that a particular set up for imposition and the payment of fee under Section 234E was provided but, it did not provide for making of demand of such fee under Section 200A payable under Section 234E. Hence, considering the aforesaid peculiar facts and circumstances, we are unable to accept the contention of the learned counsel for respondent-Revenue that insertion of clause (c) to (f) under Section 200A(1) should be treated as retroactive in character and not prospective. 22. It is hardly required to be stated that, as per the well established principles of interpretation of statute, unless it is expressly provided or impliedly demonstrated, any provision of statute is to be read as having prospective effect and not retrospective effect. Under the circumstances, we find that substitution made by clause (c) to (f) of sub-section (1) of Section 200A can be read as having prospective effect and not having retroactive character or effect. Resultantly, the demand under Section 200A for computation and intimation for the payment of fee under Section 234E could not be made in purported exercise of power under Section 200A by the respondent for the period of the respective assessment year prior to 1.6.2015. However, we make it clear that, if any ITA No.509/PUN/2021 for A.Y.2015-16 Absterge ACME Filters India Pvt. Ltd., vs. ACIT, CPC,TDS(AO), Ghaziabad (A) 5 deductor has already paid the fee after intimation received under Section 200A, the aforesaid view will not permit the deductor to reopen the said question unless he has made payment under protest." 14. The Hon'ble High Court thus held that where the impugned notices given by Revenue Department under section 200A of the Act were for the period prior to 01.06.2015, then same were illegal and invalid. Vide para 27, it was further held that the impugned notices under section 200A of the Act were for computation and intimation for payment of fees under section 234E of the Act as they relate for the period of tax deducted at source prior to 01.06.2015 were being set aside. 6. Respectfully following the above decision of ITAT Pune Bench, we hold that the levy of late fee under section 234E of the Act for the Financial Year 2014-15 - Q1, is bad in law. Therefore, the Assessing Officer is directed to delete the said late fee. Accordingly, the appeal of the assessee is allowed. 7. In the result, appeal of the assessee is allowed. Order pronounced in the open Court on 7 th July, 2022. Sd/- Sd/- (S.S.GODARA) (DR. DIPAK P. RIPOTE) JUDICIAL MEMBER ACCOUNTANT MEMBER पुणे / Pune; ᳰदनांक / Dated : 7 th July, 2022/ SGR* आदेशकᳱᮧितिलिपअᮕेिषत / Copy of the Order forwarded to : 1. अपीलाथᱮ / The Appellant. 2. ᮧ᭜यथᱮ / The Respondent. 3. The CIT(A), concerned. 4. The Pr. CIT, concerned. 5. िवभागीयᮧितिनिध, आयकर अपीलीय अिधकरण, “ए” बᱶच, पुणे / DR, ITAT, “A” Bench, Pune. 6. गाडᭅफ़ाइल / Guard File. आदेशानुसार / BY ORDER, // TRUE COPY // Senior Private Secretary आयकरअपीलीयअिधकरण, पुणे/ITAT, Pune.