TANISUJAN INFRA PRIVATE LIMITED ,MYSURU V. ACIT, CIRCLE-1(1) & TPS, MYSURU

ITA 1293/BANG/2025

AI Insights

The case involves Tanisujan Infra Private Limited, which appealed against the order of the CIT(A)/NFAC that upheld a late fee levied under section 234E of the Income Tax Act for belated filing of TDS statements. The late fee was imposed for the second, third, and fourth quarters of the financial year 2012-13. The primary legal contention was whether the late fee could be levied for periods prior to the amendment of section 200A(1)(c) of the Act on June 1, 2015, which provided the mechanism for such levies. The Tribunal, referencing a decision by the Karnataka High Court, found that the levy was not applicable for the period in question as the necessary charging provision was not in effect.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 772045 (ITAT-BANGALORE)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-08-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Assessment Year: 2013-2014
• Other Referred Cases: Fatheraj Singhvi Vs. UOI
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SUBRAMANIAN S.
• Assessee Lawyers: SRIKANTA PRASAD
• Keywords: Retrospective amendment; TDS

Judgement Text

"ITA No.1293/Bang/2025 Tanisujan Infra Private Limited, Mysuru IN THE INCOME TAX APPELLATE TRIBUNAL “B’’ BENCH: BANGALORE BEFORE SHRI LAXMI PRASAD SAHU, ACCOUNTANT MEMBER AND SHRI KESHAV DUBEY, JUDICIAL MEMBER ITA No.1293/Bang/2025 Assessment Year : 2013-14 Tanisujan Infra Private Limited 1134, Karuna Marga Siddatharatha Nagar Mysuru 570 011 Karnataka PAN NO : AADCT6102E Vs. ACIT Circle -1(1) & TPS Mysuru APPELLANT RESPONDENT Appellant by : Sri Srikanta Prasad, A.R. Respondent by : Sri Subramanian S., D.R. Date of Hearing : 18.08.2025 Date of Pronouncement : 26.08.2025 O R D E R PER KESHAV DUBEY, JUDICIAL MEMBER: This appeal at the instance of the assessee is directed against the order of ld. CIT(A)/NFAC dated 21.3.2025 vide DIN & Order No. ITBA/NFAC/S/250/2024-25/1074814958(1) for the assessment year 2012-13 passed u/s 250 of the Income Tax Act, 1961 (in short “The Act”.) 2. The brief facts of the case are that the assessee being a company registered under the Companies Act filed the quarterly statement of deduction of tax at source u/s 200(3) of the Act in Form No.26Q for the quarters 2, 3 & 4 of the financial year 2012-13 belatedly and accordingly an intimation u/s 200A of the Act levying a late fee u/s 234E of the Act amounting to Rs.1,58,800/- was raised for the delay in filing the said TDS statements. Printed from counselvise.com ITA No.1293/Bang/2025 Tanisujan Infra Private Limited, Mysuru Page 2 of 4 3. Aggrieved by the intimation passed u/s 200A of the Act dated 14.2.2019, the assessee preferred an appeal before the ld. CIT(A)/NFAC. 4. The ld. CIT(A)/NFAC dismissed the appeal of the assessee by following the decision of Hon’ble Madras High Court which held that section 234E of the Act by itself creates a liability and the liability to pay the late fee is not dependent on section 200A(1)(c) of the Act which only prescribes the recovery mechanism reflects the true intent & purpose of Section 234E. Section 234E of the Act is the substantive provision and section 200A(1)(c) of the Act prescribes the recovery mechanism. Therefore, the court held that the provision of section 234E has to be effective from 01/07/2012 and not from 01.06.2015. 5. Aggrieved by the order of ld. CIT(A)/NFAC, the assessee has filed the present appeal before this Tribunal. 6. Before us, the ld. A.R. of the assessee vehemently submitted that the judgement of jurisdictional high court in the case of Fatheraj Singhvi Vs. UOI (2016) 289 CTR 602 (Karn HC) is squarely covered in the present case which prohibits such levy prior to 1.6.2015 and accordingly prayed to allow the appeal of the assessee. 7. Ld. D.R. on the other hand relied on the orders of the authorities below. 8. We have heard the rival submissions and perused the materials available on record. The solitary issue in the present appeal is whether the ld. CIT(A)/NFAC was justified in confirming the action of the AO/TDSCPC in levying late fee u/s 234E of the Printed from counselvise.com ITA No.1293/Bang/2025 Tanisujan Infra Private Limited, Mysuru Page 3 of 4 Act? Admittedly, the quarterly statement of TDS for Q2, Q3 & Q4 of financial year 2012-13 were filed belatedly. In our opinion, the late fee was levied for the period prior to the amendment to section 200A of the Act, which come into effect on 1.6.2015 enabling the levy of late fee by the AO/TDSCPC. It is also undisputed fact that the Hon’ble Karnataka High Court in the case of Shri Fatheraj Singhvi (supra) took a view that in the absence of charging provision, late fee u/s 234E of the Act cannot be levied for the period prior to 1.6.2015. 8.1 The Hon’ble jurisdictional high court held that the levy of late fee u/s 234E of the Act was introduced vide Finance Act, 2012 w.e.f. 1.7.2012 but it became operational/effective only w.e.f. 1.6.2015 when the section 200A(1)(c) of the Act was amended/substituted by Finance Act, 2015 with prospective effect from 1.6.2015 whereby the fees to be computed in accordance with the provision of section 234E of the Act stood included while processing the statement of tax deducted at source. The jurisdictional High Court further held that such amendment or mechanism introduced w.e.f. 1.6.2015 is not merely a regulatory mechanism but is substantive in nature. Thus, the amendment to section 200A(1)(c) of the Act cannot be given retrospective effect. Thereafter, by relying on the decision of Apex court in the case of B.C. Srinivasa Shetty reported in 21 CTR (SC) 138, the court held that “when the machinery provision is not provided the levy itself would fail” and accordingly, the Hon’ble Karnataka High court finally decided that levy of fees u/s 234E of the Act prior to 1.6.2015 is held to be without authority of law. 8.2 Considering the decision of Hon’ble jurisdictional High court which is binding on us, respectfully following the decision of Hon’ble jurisdictional high court in the case of Shri Fatheraj Printed from counselvise.com ITA No.1293/Bang/2025 Tanisujan Infra Private Limited, Mysuru Page 4 of 4 Singhvi & Ors. Vs. UOI (supra), we delete the levy of late fee u/s 234E of the Act amounting to Rs.1,58,800/- for Q2, Q3 & Q4 of the financial year 2012-13 as it is without Authority of Law. 9. In the result, appeal filed by the assessee is allowed. Order pronounced in the open court on 26th Aug, 2025 Sd/- (Laxmi Prasad Sahu) Accountant Member Sd/- (Keshav Dubey) Judicial Member Bangalore, Dated 26th Aug, 2025. VG/SPS Copy to: 1. The Applicant 2. The Respondent 3. The CIT 4. The DR, ITAT, Bangalore. 5 Guard file By order Asst. Registrar, ITAT, Bangalore. Printed from counselvise.com "