Late fees under section 234E cannot be levied for TDS returns filed before June 1, 2015

ITAT Jodhpur held that late fees under section 234E cannot be levied for delay in filing quarterly TDS returns prior to 01.06.2015, as this provision came into effect from that date and is prospective in nature. The tribunal ruled that intimations under section 200A for FY 2012-13 seeking late fees were not supported by law, following precedent from Madhya Pradesh Gramin Bank case. The assessee's appeal was allowed, confirming that the demand was not in accordance with law.

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Issues Involved:
1. Violation of the principle of faceless appeal.
2. Validity of the order passed under Section 154.
3. Condonation of delay in filing the appeal.
4. Levy of late fee under Section 234E.
5. Consideration of judicial decisions and submissions.
6. Analysis of the provision of law.
7. Erroneous and irrelevant findings in the order.

Summary:

1. Violation of the Principle of Faceless Appeal:
The assessee argued that the CIT(A) NFAC violated the principle of faceless appeal, which is intended to ensure justice for honest taxpayers and to avoid unnecessary litigation created by the AO.

2. Validity of the Order Passed Under Section 154:
The CIT(A) upheld the validity of the order passed by the AO under Section 154 of the Act. The assessee had requested rectification of the order under Section 200A, which the AO denied without providing the requested relief.

3. Condonation of Delay in Filing the Appeal:
The CIT(A) dismissed the appeal due to a delay of 1968 days in filing. The CIT(A) emphasized that the appellant must demonstrate "sufficient cause" for the delay, which the appellant failed to do. The appeal was filed against the rectification order dated 13.06.2019, challenging the original intimation dated 23.12.2013.

4. Levy of Late Fee Under Section 234E:
The CIT(A) upheld the levy of a late fee of Rs. 38,200 under Section 234E. The appellant contended that the power to charge fees under Section 234E came into effect on 01.06.2015 and should not apply retrospectively. The Tribunal agreed with the appellant, stating that the levy of late fees for the period prior to 01.06.2015 was not supported by law and thus, the demand was not in accordance with the law.

5. Consideration of Judicial Decisions and Submissions:
The CIT(A) did not discuss the appellant's submissions and judicial decisions on merits due to the appeal being filed belatedly. The Tribunal, however, considered similar cases and judicial precedents, such as Madhya Pradesh Gramin Bank vs. ACIT, which supported the appellant's contention that late fees under Section 234E could not be levied for periods before 01.06.2015.

6. Analysis of the Provision of Law:
The Tribunal noted that the power to levy late fees under Section 234E came into effect from 01.06.2015 and should be applied prospectively. Therefore, the levy of late fees for the assessment years prior to this date was incorrect.

7. Erroneous and Irrelevant Findings in the Order:
The Tribunal found that the CIT(A) made erroneous findings and sustained arbitrary additions, causing harassment and inconvenience to the assessee. The Tribunal vacated the levy of late fees under Section 234E and allowed the appeals.

Conclusion:
The appeals of the assessee for the assessment years 2013-14 and 2014-15 were allowed. The Tribunal vacated the levy of late fees under Section 234E, stating that the power to levy such fees came into effect from 01.06.2015 and should not be applied retrospectively. The Tribunal emphasized the importance of substantive justice and the correct application of the law.

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