Appeal Tribunal Overturns Late Fee under Section 234E in TDS Returns

In the case involving ITA No. 177/Hyd/2018, the appellate tribunal set aside the CIT(A) order and directed to condone the delay in filing the appeal against the late fee u/s 234E on the TDS return, allowing the appeal for statistical purposes. In ITA No. 178/Hyd/2018, the tribunal directed the AO to delete the late fee imposed u/s 234E on the TDS return, as it was held that such levy before the Finance Act 2015 was without authority of law. Consequently, both appeals were allowed, with the late fee u/s 234E being deleted in both cases.

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Issues:
Late fee u/s 234E levied on TDS return, condonation of delay in filing appeal, inclusion of late fee u/s 234E in intimation u/s 200A, validity of late fee levy before Finance Act 2015.

Analysis:
In the case involving ITA No. 177/Hyd/2018, the assessee appealed against the late fee u/s 234E levied on the TDS return. The CIT(A) rejected the appeal, citing that the delay in filing the appeal was not condoned due to misconstrued arguments by the appellant. However, the appellate tribunal set aside the CIT(A) order, directing to condone the delay and adjudicate the appeal on merits after providing a reasonable opportunity to the assessee. The tribunal found it necessary to meet the ends of justice by allowing the appeal for statistical purposes.

Moving on to ITA No. 178/Hyd/2018, the AO levied late fee u/s 234E on the assessee's TDS return. The assessee contended that including late fee u/s 234E in the intimation u/s 200A was impermissible before the Finance Act 2015. The CIT(A) upheld the AO's action, referring to a judgment of the Gujarat High Court. However, the appellate tribunal referred to a similar case where it was held that prior to 1.6.2015, the levy of late fee u/s 234E on TDS returns was without authority of law. Consequently, the tribunal directed the AO to delete the late fee imposed u/s 234E, allowing the appeal.

In conclusion, both appeals were allowed, with the tribunal setting aside the CIT(A) orders and directing the deletion of late fee u/s 234E in both cases. The judgments were pronounced on 26th October 2018.

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