Khanna Watches Ltd., Chandigarh V. DCIT, Chandigarh

ITA 731/CHANDI/2015

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 95633 (ITAT-CHANDIGARH)
• Duration Of Justice: 2 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-10-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2014-2015
• Appeal Filed On: 11-08-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MANJIT SINGH
• Assessee Lawyers: PRAVEEN KAPOOR
• Keywords: Opportunity of being heard

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DIVISION BENCH,CHANDIGARH BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND MS.ANNAPURNA MEHROTRA, ACCOUNTANT MEMBER ITA NOS. 731 TO 735/CHD/2015 A.Y: 2014-15 & 2013-14 M/S KHANNA WATCHES LTD., VS THE DCIT(CPC)-TDS, 82, INDUSTRIAL AREA-I VAISHALI, CHANDIGARH. AYAKA R BHAWAN, SECTOR 3, PAN: AAACK8559 GHAZIABAD (UP). (ASSESSED AT ITO, TDS-I, CHANDIGARH). (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI PRAVEEN KAPOOR RESPONDENT BY : SHRI MANJIT SINGH DATE OF HEARING : 28.10.2015 DATE OF PRONOUNCEMENT : 29.10.2015 O R D E R PER BHAVNESH SAINI,JM ALL THE APPEALS BY ASSESSEE ARE DIRECTED AGAINST TW O DIFFERENT ORDERS OF LD. CIT(APPEALS)-I, CHANDIGARH DATED 20.05.2015 FOR ABOVE ASSESSMENT YEARS, CHALLENGING THE LEVY OF FEES UNDER SECTION 234E OF THE INCOME TAX A CT. 2. THE ISSUE IS COMMON IN ALL THE APPEALS, THEREFOR E, ALL APPEALS WERE HEARD TOGETHER AND WE DISPOSE OF T HE SAME THROUGH THIS COMMON CONSOLIDATED ORDER. 3. BRIEFLY THE FACTS OF THE CASE ARE THAT THESE APP EALS ARE AGAINST INTIMATION UNDER SECTION 200A OF THE IN COME TAX ACT, WHEREBY LATE FILING FEE UNDER SECTION 234E HAS BEEN LEVIED AND THE ONLY EFFECTIVE GROUND OF APPEAL TAKEN 2 IN ALL THE APPEALS ARE AGAINST CHARGING OF LATE FEE S UNDER SECTION 234E OF THE ACT. THE ASSESSEE CONTENDED BE FORE LD. CIT(APPEALS) THAT THE INTIMATION WAS PASSED WIT HOUT PROVIDING ANY OPPORTUNITY OF BEING HEARD BECAUSE TH E TAX WAS DEPOSITED IN TIME AND LATE FILING WAS ONLY ON TECHNICAL ERROR RESULTING IN NO LOSS TO THE REVENUE AND FEE CAN BE RECOVERED ONLY AT THE TIME OF FILING RET URN. IT WAS ALSO SUBMITTED THAT THE IMPUGNED RETURNS WERE L ATE DUE TO ACCOUNTANTS FAULT. IT WAS ALSO CONTENDED T HAT FEES UNDER SECTION 234E CAN BE RECOVERED AT THE TIM E OF FILING OF THE RETURN AND NOT THEREAFTER. 4. THE LD. CIT(APPEALS), CONSIDERING THE SUBMISSION S OF THE ASSESSEE NOTED THAT IN ALL THE INTIMATIONS U NDER SECTION 200A OF THE ACT, LATE FEES UNDER SECTION 23 4E OF THE ACT HAS BEEN CHARGED. A DEDUCTOR IS ALLOWED TO FILE THE TDS STATEMENT BEYOND THE PRESCRIBED TIME PROVID ED HE PAYS THE FEES AS PRESCRIBED UNDER SECTION 234E O F THE ACT. IN OTHER WORDS, LATE FILING OF THE TDS STATEM ENT IS REGULARIZED UPON PAYMENT OF THE FEE AS SET OUT IN S ECTION 234E. THE LATE FEE UNDER SECTION 234E IS TO BE MANDATORILY LEVIED AND SO THE SAME CANNOT BE WAIVED . THE LD. CIT(APPEALS) REJECTED THE CONTENTION OF THE ASSESSEE THAT SINCE THERE WAS NO LOSS OF REVENUE, N O FEES CAN BE LEVIED. IT COULD BE RECOVERED ONLY AT THE T IME OF FILING OF THE RETURN. THE LD. CIT(APPEALS), ACCORD INGLY, DISMISSED ALL THE APPEALS OF THE ASSESSEE. 3 5. THE LD. COUNSEL FOR THE ASSESSEE REITERATED THE SUBMISSIONS MADE BEFORE AUTHORITIES BELOW AND SUBMITTED THAT IN ALL THE CASES, THE INTIMATION WAS ISSUED UNDER SECTION 200A OF THE ACT WHEREBY THE LA TE FILING FEE UNDER SECTION 234E HAS BEEN LEVIED. HE HAS SUBMITTED THAT SECTION 200A(1)(C) WAS SUBSTITUTED B Y FINANCE ACT, 2015 W.E.F. 01.06.2015 WHEREBY THE PROVISION WAS MADE WHICH READS AS UNDER : C- THE FEE, IF ANY, SHALL BE COMPUTED IN ACCORDANCE WITH THE PROVISIONS OF SECTION 234E. 6. THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT SINCE THERE WERE NO PROVISIONS FOR LEVY OF THE FEES UNDER SECTION 200A, IT WAS LATER ON INSERTED IN SECTION 200A(1)(C) W.E.F. 01.06.2015 AND THE CASES OF THE ASSESSEE PERTAIN TO THE PRIOR PERIOD BEFORE 01.06.2 015, THEREFORE, NO FEE CAN BE LEVIED UNDER SECTION 234E OF THE ACT. HE HAS SUBMITTED THAT THE ISSUE IS COVERED IN FAVOUR OF THE ASSESSEE BY ORDER OF ITAT AMRITSAR BENCH IN THE CASE OF SIBIA HEALTHCARE PRIVATE LTD. V DCIT (TDS) IN ITA 90/2015 VIDE ORDER DATED 09.06.2015 IN WHICH IN PAR AS 4 TO 10, IDENTICAL ISSUE HAS BEEN DECIDED IN FAVOUR O F THE ASSESSEE. THE ORDER OF THE TRIBUNAL IS REPRODUCED AS UNDER : 4. WE HAVE HEARD THE RIVAL CONTENTIONS, PERUSED THE MATERIAL ON RECORD AND DULY CONSIDERED FACTS OF THE CASE IN THE LIGHT OF THE APPLICABLE LEGAL POSITION. IN ADDITION TO HIS ARGUM ENT ON THE MERITS, LEARNED COUNSEL HAS ALSO INVITED OUR ATTENTION TO T HE REPORTS ABOUT THE DECISIONS OF VARIOUS HON'BLE HIGH COURTS, INCLU DING HON'BLE 4 KERALA HIGH COURT, IN THE CASE OF NARATH MAPILA LP SCHOOL VS UNION OF INDIA [WP (C) 31498/2013(J)], HON'BLE KARANATAKA HIGH COURT IN THE CASE OF ADITHYA BIZOR P SOLUTIONS VS UNION OF I NDIA [WP NO. 6918-6938/2014(T-IT), HON'BLE RAJASTHAN HIGH COURT IN THE CASE OF OM PRAKASH DHOOT VS UNION OF INDIA [WP NO. 1981 OF 2014] AND OF HON'BLE BOMBAY HIGH COURT IN THE CASE OF RASHMIKANT KUNDALIA VS UNION OF INDIA [WP NO. 771 OF 2014], GRANTING STAY ON THE DEMANDS RAISED IN RESPECT OF FEES UNDER SECTION 234E. THE F ULL TEXT OF THESE DECISIONS WERE NOT PRODUCED BEFORE US. HOWEVER, AS ADMITTEDLY THERE ARE NO ORDERS FROM THE HON'BLE COURTS ABOVE RETRAIN ING US FROM OUR ADJUDICATION ON MERITS IN RESPECT OF THE ISSUES IN THIS APPEAL, AND AS, IN OUR HUMBLE UNDERSTANDING, THIS APPEAL REQUIRES A DJUDICATION ON A VERY SHORT LEGAL ISSUE, WITHIN A NARROW COMPASS OF MATERIAL FACTS, WE ARE PROCEEDING TO DISPOSE OF THIS APPEAL ON MERITS. 5. WE MAY PRODUCE, FOR READY REFERENCE, SECTION 234 E OF THE ACT, WHICH WAS INSERTED BY THE FINANCE ACT 2012 AND WAS BROUGHT INTO EFFECT FROM 1 ST JULY 2012. THIS STATUTORY PROVISION IS AS FOLLOWS: 234E. FEE FOR DEFAULTS IN FURNISHING STATEMENTS (1) WITHOUT PREJUDICE TO THE PROVISIONS OF THE ACT, WHE RE A PERSON FAILS TO DELIVER OR CAUSE TO BE DELIVERED A STATEMENT WITHIN THE TIME PRESCRIBED IN SUB-SECTION (3) OF SECTION 200 OR THE PROVISO TO SUB SECTION (3) OF SECTION 206C, HE SHALL BE LIABLE TO PAY, BY WAY OF FEE, A SUM OF TWO HUNDRED RUPEES FOR EVERY DAY DURING WHIC H THE FAILURE CONTINUES. (2) THE AMOUNT OF FEE REFERRED TO IN SUB-SECTION (1) SH ALL NOT EXCEED THE AMOUNT OF TAX DEDUCTIBLE OR COLLECTIBLE, AS THE CAS E MAY BE. (3) THE AMOUNT OF FEE REFERRED TO IN SUB-SECTION (1) SH ALL BE PAID BEFORE DELIVERING OR CAUSING TO BE DELIVERED A STATEMENT I N ACCORDANCE WITH SUB-SECTION (3) OF SECTION 200 OR THE PROVISO TO SU B-SECTION (3) OF SECTION 206C. (4) THE PROVISIONS OF THIS SECTION SHALL APPLY TO A STA TEMENT REFERRED TO IN SUB-SECTION (3) OF SECTION 200 OR THE PROVISO TO SUB-SECTION (3) OF SECTION 206C WHICH IS TO BE DELIVERED OR CAUSED TO BE DELIVERED FOR TAX DEDUCTED AT SOURCE OR TAX COLLECTED AT SOURCE, AS T HE CASE MAY BE, ON OR AFTER THE 1ST DAY OF JULY, 2012 6. WE MAY ALSO REPRODUCE THE SECTION 200A WHICH WAS INSERTED BY THE FINANCE ACT 2009 WITH EFFECT FROM 1 ST APRIL 2010. THIS STATUTORY PROVISION, AS IT STOOD AT THE RELEVANT POINT OF TIM E, WAS AS FOLLOWS: 200A: PROCESSING OF STATEMENTS OF TAX DEDUCTED AT SOURCE 5 (1) WHERE A STATEMENT OF TAX DEDUCTION AT SOURCE, O R A CORRECTION STATEMENT, HAS BEEN MADE BY A PERSON DED UCTING ANY SUM (HEREAFTER REFERRED TO IN THIS SECTION AS DEDUC TOR) UNDER 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 INFORMAT ION IN THE STATEMENT; (B) THE INTEREST, IF ANY, SHALL BE COMPUTED ON THE BASI S 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 (D) AGAINST ANY AMOUNT PAID UNDER SECTION 200 AND SECTI ON 201, AND ANY AMOUNT PAID OTHERWISE BY WAY OF TAX OR INTE REST; (D) AN INTIMATION SHALL BE PREPARED OR GENERATED AND SENT TO THE DEDUCTOR SPECIFYING THE SUM DETERMINED TO BE PA YABLE BY, OR THE AMOUNT OF REFUND DUE TO. HIM UNDER CLAUSE (C); AND (E) THE AMOUNT OF REFUND DUE TO THE DEDUCTOR IN PURSUAN CE 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 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 TH E STATEMENT' SHALL MEAN A CLAIM, ON THE BASIS OF AN ENTRY, IN TH E STATEMENT (1) OF AN ITEM, WHICH IS INCONSISTENT WITH ANOTHER ENTRY 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 TH IS ACT; (2) FOR THE PURPOSES OF PROCESSING OF STATEMENTS U NDER 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 . 7. BY WAY OF FINANCE ACT 2015, AND WITH EFFECT FROM 1 ST JUNE 2015, THERE IS AN AMENDMENT IN SECTION 200A AND THIS AMEN DMENT, AS STATED IN THE FINANCE ACT 2015, IS AS FOLLOWS: IN SECTION 200A OF THE INCOME-TAX ACT, IN SUB- SECTION (1), FOR CLAUSES (C) TO (E), THE FOLLOWING CLAUSES SHALL BE SUBSTITUTED WITH EFFECT FROM THE 1ST DAY OF JUNE, 2015, NAMELY: 6 '(C) THE FEE, IF ANY, SHALL BE COMPUTED IN ACCORDANCE WITH THE PROVISIONS OF SECTION 234E; (D) THE SUM PAYABLE BY, OR THE AMOUNT OF REFUND DUE TO, THE DEDUCTOR SHALL BE DETERMINED AFTER ADJUSTMENT OF THE AMOUNT COMPUTED UNDER CLAUSE (B) AND CLAUSE (C) AGAINST ANY AMOUNT PAID UNDER SECTION 200 OR SECTION 201 OR SECTION 234E AND ANY AMOUNT PAID OTHERWISE BY WAY OF TAX OR INTEREST OR FEE; (E) AN INTIMATION SHALL BE PREPARED OR GENERATED AND SENT TO THE DEDUCTOR SPECIFYING THE SUM DETERMINED TO BE PAYABLE BY, OR THE AMOUNT OF REFUND DUE TO, HIM UNDER CLAUSE (D); AND (F) THE AMOUNT OF REFUND DUE TO THE DEDUCTOR IN PURSUANCE OF THE DETERMINATION UNDER CLAUSE (D) SHALL BE GRANTED TO THE DEDUCTOR. 8. IN EFFECT THUS, POST 1 ST JUNE 2015, IN THE COURSE OF PROCESSING OF A IDS STATEMENT AND ISSUANCE OF INTIMATION UNDER SECT ION 200A IN RESPECT THEREOF, AN ADJUSTMENT COULD ALSO BE MADE I N RESPECT OF THE 'FEE, IF ANY, SHALL BE COMPUTED IN ACCORDANCE WITH THE PROVISIONS OF SECTION 234E'. THERE IS NO DISPUTE THAT WHAT IS IMPUGNED IN APPEAL BEFORE US IS THE INTIMATION UNDER SECTION 200A OF T HE ACT, AS STATED IN SO MANY WORDS IN THE IMPUGNED INTIMATION ITSELF, AN D, AS THE LAW STOOD, PRIOR TO 1 ST JUNE 2015, THERE WAS NO ENABLING PROVISION THEREIN FOR RAISING A DEMAND IN RESPECT OF LEVY OF FEES UNDER SECTION 234E. WHILE EXAMINING THE CORRECTNESS OF THE INTIMA TION UNDER SECTION 200A, WE HAVE TO BE GUIDED BY THE LIMITED M ANDATE OF SECTION 200A, WHICH, AT THE RELEVANT POINT OF TIME, PERMITT ED COMPUTATION OF AMOUNT RECOVERABLE FROM, OR PAYABLE TO, THE TAX DE DUCTOR AFTER MAKING THE FOLLOWING ADJUSTMENTS: (A), AFTER MAKING ADJUSTMENT ON ACCOUNT OF ' ARITHMETICAL ERRORS' AND 'INCORRECT CLAIMS APPARENT FROM ANY INF ORMATION IN HE STATEMENT' - SECTION 200A(1)(A) (B). AFTER MAKING ADJUSTMENT FOR 'INTEREST, IF ANY, COMPUTED ON THE BASIS OF SUMS DEDUCTIBLE AS COMPUTE D IN THE STATEMENT'. - SECTION 200A(1)(B) 9. NO OTHER ADJUSTMENTS IN THE AMOUNT REFUNDAB LE TO, OR RECOVERABLE FROM, THE TAX DEDUCTOR, WERE PERMISSIBL E IN ACCORDANCE WITH THE LAW AS IT EXISTED AT THAT POINT OF TIME. 7 10. IN VIEW OF THE ABOVE DISCUSSIONS, IN OUR CO NSIDERED VIEW, THE ADJUSTMENT IN RESPECT OF LEVY OF FEES UNDER SECTION 234E WAS INDEED BEYOND THE SCOPE OF PERMISSIBLE ADJUSTMENTS CONTEMP LATED UNDER SECTION 200A. THIS INTIMATION IS AN APPEALABLE ORDE R UNDER SECTION 246A(A), AND, THEREFORE, THE CIT(A) OUGHT TO HAVE E XAMINED LEGALITY OF THE ADJUSTMENT MADE UNDER THIS INTIMATION IN THE LIGHT OF THE SCOPE OF THE SECTION 200A. LEARNED CIT(A) HAS NOT D ONE SO. HE HAS JUSTIFIED THE LEVY OF FEES ON THE BASIS OF THE PROV ISIONS OF SECTION 234E. THAT IS NOT THE ISSUE HERE. THE ISSUE IS WHET HER SUCH A LEVY COULD BE EFFECTED IN THE COURSE OF INTIMATION UNDER SECTION 200A. THE ANSWER IS CLEARLY IN NEGATIVE. NO OTHER PROVISI ON ENABLING A DEMAND IN RESPECT OF THIS LEVY HAS BEEN POINTED OUT TO US AND IT IS THUS AN ADMITTED POSITION THAT IN THE ABSENCE OF TH E ENABLING PROVISION UNDER SECTION 200A, NO SUCH LEVY COULD BE EFFECTED. AS INTIMATION UNDER SECTION 200A, RAISING A DEMAND OR DIRECTING A REFUND TO THE TAX DEDUCTOR, CAN ONLY BE PASSED WITH IN ONE YEAR FROM THE END OF THE FINANCIAL YEAR WITHIN WHICH THE RELA TED TDS STATEMENT IS FILED, AND AS THE RELATED TDS STATEMENT WAS FILE D ON 19 TH FEBRUARY 2014, SUCH A LEVY COULD ONLY HAVE BEEN MAD E AT BEST WITHIN 31 ST MARCH 2015. THAT TIME HAS ALREADY ELAPSED AND THE DEFECT IS THUS NOT .CURABLE EVEN AT THIS STAGE. IN VIEW OF THESE DISCUSSIONS AS ALSO BEARING IN MIND ENTIRETY OF THE CASE, THE IMPUGNED LEVY OF FEES UNDER SECTION 234 E IS UNSUST AINABLE IN LAW. WE, THEREFORE, UPHOLD THE GRIEVANCE OF THE ASSESSEE AND DELETE THE IMPUGNED LEVY OF FEE UNDER SECTION 234E OF THE ACT. THE ASSESSEE GETS THE RELIEF ACCORDINGLY. 7. ON THE OTHER HAND, LD. DR OPPOSED THE SUBMISSION S OF LD. COUNSEL FOR THE ASSESSEE AND RELIED UPON ORD ERS OF THE AUTHORITIES BELOW. HE HAS RELIED UPON DECISION OF BOMBAY HIGH COURT IN THE CASE RASHMIKANT KUNDALIA V S UNION OF INDIA DATED 06.02.2015 IN WRIT PETITION NO . 771/2014 AND DECISION OF RAJASTHAN HIGH COURT IN TH E 8 CASE OF M/S DUNDLOD SHIKSHAN SANSTHAN VS UOI DATED 28.07.2015 IN WRIT PETITION NO. 8672/2014. 8. WE HAVE CONSIDERED RIVAL SUBMISSIONS AND MATERIA L AVAILABLE ON RECORD. SECTION 234E PROVIDES FEES FOR DEFAULTING IN FURNISHING STATEMENTS. SECTION 200A OF THE INCOME TAX ACT PROVIDES PROVISIONS FOR PROCESSING O F STATEMENTS OF TAX DEDUCTED AT SOURCE. SUB SECTION (C) OF SECTION 200A(1) WAS SUBSTITUTED W.E.F. 01.06.2015 A ND FROM 01.06.2015, THE SAME READS AS UNDER : C- THE FEE, IF ANY, SHALL BE COMPUTED IN ACCORDANCE WITH THE PROVISIONS OF SECTION 234E OF THE INCOME TAX ACT. 9. THE IDENTICAL ISSUE WAS CONSIDERED BY ITAT AMRITSAR BENCH IN THE CASE OF SIBIA HEALTHCARE PVT. LTD. (SUPRA) AND THE ISSUE HAS BEEN DECIDED IN FAVOUR OF THE ASSESSEE. IN THE CASE OF THE ASSESSEE, THE FEE UND ER SECTION 234E OF THE ACT HAS BEEN LEVIED FOR ASSESSM ENT YEARS PRIOR TO THE AMENDMENT IN SUB CLAUSE (C) OF S ECTION 200A(1) OF THE ACT I.E. PRIOR TO 01.06.2015. THERE FORE, ISSUE IS COVERED IN FAVOUR OF THE ASSESSEE BY ORDER OF ITAT AMRITSAR BENCH IN THE CASE OF SIBIA HEALTHCARE PVT. LTD.(SUPRA). 9(I) IDENTICAL ISSUE WAS ALSO CONSIDERED BY ITAT CHANDIGARH BENCH IN THE CASE OF THE PUNJAB STATE COOPERATIVE BANK EMPLOYEES PENSION FUND TRUST VS DC IT IN ITA 728-730/2015 FOR ASSESSMENT YEAR 2014-15 AND 9 VIDE ORDER DATED 28.10.2015, THE APPEALS OF THE ASS ESSEE ARE ALLOWED. THE FINDINGS OF THE TRIBUNAL IN PARAS 8 TO 11 OF THE ABOVE ORDER ARE REPRODUCED AS UNDER : 8. WE FIND THAT THE INTIMATION UNDER SECTION 200A, IN WHICH THE LATE FILING FEE UNDER SECTION 234E WAS LEVIED, WAS DT. 07/05/20 14. ON THE SAID DATE THE APPLICABLE PROVISIONS OF SECTION 200A WAS AS FOLLOW S: 200A. (1) WHERE A STATEMENT OF TAX DEDUCTION AT S OURCE OR A CORRECTION STATEMENT HAS BEEN MADE BY A PERSON DEDU CTING ANY SUM (HEREAFTER REFERRED TO IN THIS SECTION AS DEDUCTOR) UNDER SECTION 200, SUCH STATEMENT SHALL BE PROCESSED IN THE FOLLOWING MANNE R, NAMELY:- (A) THE SUMS DEDUCTIBLE UNDER THIS CHAPTER SHALL BE 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; A BARE PERUSAL OF THE READING OF SECTION 200A MAKES IT CLEAR THAT WHILE PROCESSING TDS STATEMENTS UNDER SECTION 200A THE ON LY ADJUSTMENTS WHICH COULD BE MADE WERE ON ACCOUNT OF ANY ARITHMETICAL E RROR IN THE STATEMENT OR ANY INCORRECT CLAIM APPARENT FROM ANY INFORMATION IN TH E STATEMENT OR THE LEVY OF ANY INTEREST ON TDS. NO OTHER ADJUSTMENT COULD BE M ADE WHILE PROCESSING THE TDS STATEMENTS UNDER SECTION 200A. THE LEVY OF FEE UNDER SECTION 234E, IN THE IMPUGNED CASE WAS CLEARLY THEREFORE BEYOND THE POWE RS PRESCRIBED UNDER SECTION 200A. IT IS PERTINENT TO POINT OUT THAT BY VIRTUE OF AMENDMENT TO SECTION 200A BROUGHT ABOUT BY THE FINANCE ACT 2015, WITH EF FECT FROM 01/06/2015 , THE POWER TO LEVY FEES UNDER SECTION 234E HAS BEEN SPEC IFICALLY INCORPORATED UNDER SECTION 200A. THUS PRIOR TO 01/06/2015 NO FEE UNDER SECTION 234E COULD BE LEVIED WHILE PROCESSING TDS STATEMENTS UNDER SECTIO N 200A. THIS VIEW HAS BEEN AFFIRMED BY THE AMRITSAR BENCH OF THE ITAT IN CASE OF SIBLA HEALTHCARE PRIVATE LIMITED VS. DCIT(TDS) IN ITA NO. 90/ASR/2015 DT 09/ 06/2015, WHEREIN THE LEVY OF FEE UNDER SECTION 234E WHILE PROCESSING TDS ST ATEMENTS U/S 200A PRIOR TO 01/06/2015 WAS DELETED BY HOLDING AT PARA 10 AS FOL LOWS: 10. IN VIEW OF THE ABOVE DISCUSSIONS, IN OUR CONS IDERED VIEW, THE ADJUSTMENT IN RESPECT OF LEVY OF FEES UNDER SECTION 234E WAS INDEED BEYOND THE SCOPE OF PERMISSIBLE ADJUSTMENTS CONTEMPLATED UNDER SECTION 200A. THIS INTIMATION IS AN APPEALABLE ORDER UNDER SECTION 246A(A), AND, THEREF ORE, THE CIT(A) OUGHT OT HAVE EXAMINED LEGALITY OF THE ADJUS TMENT MADE UNDER THIS INTIMATION IN THE LIGHT OF THE SCOPE OF THE SECTION 200A. LEARNED CIT(A) HAS NOT DONE SO. HE HAS JUSTIFIED TH E LEVY OF FEES ON THE BASIS OF THE PROVISIONS OF SECTION 234E. THA T IS NOT THE ISSUE HERE. THE ISSUE IS WHETHER SUCH A LEVY COULD BE EFF ECTED IN THE 10 COURSE OF INTIMATION UNDER SECTION 200A. THE ANSWER IS CLEARLY IN NEGATIVE. NO OTHER PROVISION ENABLING A DEMAND IN R ESPECT OF THIS LEVY HAS BEEN POINTED OUT TO US AND IT IS THUS AN ADMITTED POSITION THAT IN THE ABSENCE OF THE ENABLING PROVIS ION UNDER SECTION 200A, NO SUCH LEVY COULD BE EFFECTED. AS IN TIMATION UNDER SECTION 200A, RAISING A DEMAND OR DIRECTING A REFUND TO THE TAX DEDUCTOR, CAN ONLY BE PASSED WITHIN ONE YEA R FROM THE END OF THE FINANCIAL YEAR WITHIN WHICH THE RELATED TDS STATEMENT IS FILED, AND AS THE RELATED TDS STATEMENT WAS FILE D ON 19 TH FEBRUARY 2014, SUCH A LEVY COULD ONLY HAVE BEEN MAD E AT BEST WITHIN 31 ST MARCH 2015. THAT TIME HAS ALREADY ELAPSED AND THE DEFECT IS THUS NOT CURABLE EVEN AT THIS STAGE. IN V IEW OF THESE DISCUSSIONS, AS ALSO BEARING IN MIND ENTIRETY OF TH E CASE, THE IMPUGNED LEVY OF FEES UNDER SECTION 234E IS UNSUSTA INABLE IN LAW. WE, THEREFORE, UPHOLD THE GRIEVANCE OF THE ASSESSEE AND DELETE THE IMPUGNED LEVY OF FEE UNDER SECTION 234E OF THE ACT. THE ASSESSEE GETS THE RELIEF ACCORDINGLY. FOLLOWING THIS ORDER THE CHENNAI BENCH OF THE ITAT HAS ALSO DELETED THE LEVY OF FEE UNDER SECTION 234 E WHILE PROCESSING STATEMENT OF TAX DEDUCTED AT SOURCE UNDER SECTION 200A PRIOR TO 01/06/2015 VIDE THEIR O RDER IN ITA NO. 1019, 1020 & 1021/MDS/2015 DT. 10/07/2015 BY HOLDING AT PARA 1 1 OF THE ORDER AS FOLLOWS: 11. IN VIEW OF THE ABOVE DISCUSSION, THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THE ASSESSING OFFICER HAS E XCEEDED HIS JURISDICTION IN LEVYING FEE UNDER SECTION 234E WHIL E PROCESSING THE STATEMENT AND MAKE ADJUSTMENT UNDER SECTION 200A OF THE ACT. THEREFORE, THE IMPUGNED INTIMATION OF THE LOWER AUT HORITIES LEVYING FEE UNDER SECTION 234E OF THE ACT CANNOT BE SUSTAINED IN LAW. 9. AT THIS JUNCTURE IT IS IMPERATIVE TO STATE THAT THE BENCH HAS ONLY ADJUDICATED UPON THE ISSUE OF LEVY OF FEE U/S 234E WHILE PROCESSING TDS STATEMENTS U/S 200A AND NOT THE LEVY OF FEE U/S 234 E PER SE. IN FACT WITH RESPECT TO THE SAME WE CONCUR WITH THE VIEW OF LD. CIT(A) T HAT THE SAME HAS TO BE MANDATORILY LEVIED AND CANNOT BE WAIVED. BUT, PRIOR TO 01/06/2015, THE AO CANNOT LEVY THE SAME WHILE PROCESSING TDS STATEMENT S U/S 200A. THE AO CAN PASS A SEPARATE ORDER LEVYING SUCH FEE. 10. IN VIEW OF THE ABOVE DISCUSSION WE ARE OF THE C ONSIDERED VIEW THAT THE AO HAD EXCEEDED HIS JURISDICTION IN LEVYING FEE UND ER SECTION 234E WHILE PROCESSING THE STATEMENT UNDER SECTION 200A OF THE ACT AND THEREFORE THE INTIMATION BY THE LOWER AUTHORITY CANNOT BE SUSTAIN ED IN LAW. HOWEVER, IT IS OPEN TO THE AO TO PASS A SEPARATE ORDER UNDER SECTI ON 234E LEVYING FEE FOR DELAY IN FILING STATEMENT UNDER SECTION 200 (3) OF THE ACT, PROVIDED THE LIMITATION FOR SUCH A REMEDY HAS NOT EXPIRED. ACCORDINGLY THE INTIMATION UNDER SECTION 200A SET ASIDE AND THE FEE LEVIED IS DELETED. 11. IN THE RESULT, ALL THE APPEALS OF THE ASSESSEE ARE ALLOWED. 11 10. THE DECISIONS RELIED UPON BY LD. DR PERTAIN TO THE ISSUE OF CONSTITUTIONAL VALIDITY OF SECTION 234E OF THE INCOME TAX ACT IN WHICH CONSTITUTIONAL VALIDITY OF THIS PROVISION WAS UPHELD. THE ISSUE IN THE PRESENT APP EAL HAVE NOT BEEN CONSIDERED IN THESE DECISIONS, THEREFORE, CLEARLY DISTINGUISHABLE ON FACTS AND ISSUE. 11. IN VIEW OF THE ABOVE, WE ARE OF THE CONSIDERED VIEW THAT ASSESSING OFFICER HAD EXCEEDED HIS JURISDICTIO N IN LEVYING FEES UNDER SECTION 234E OF THE INCOME TAX A CT. ACCORDINGLY, THE INTIMATION UNDER SECTION 200A READ WITH SECTION 234E OF THE INCOME TAX ACT ARE SET ASIDE AN D THE FEE LEVIED ARE DELETED. 12. IN THE RESULT, ALL THE APPEALS OF THE ASSESSEE ARE ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT. SD/- SD/- (ANNAPURNA MEHROTRA) (BHAVNESH SAINI) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 29 TH OCT., 2015. POONAM COPY TO: THE APPELLANT, THE RESPONDENT, THE CIT(A), THE CIT, DR ASSISTANT REGISTRAR, ITAT/CHD