2018 (1) TMI 331 - AT - Income Tax

Tribunal rules in favor of appellant, deletes late filing fee under section 234E, emphasizes precedent. Appeal allowed.

Nimaben Rameshbhai Thakkar Versus The Dy. Commissioner of Income-tax TDS, Ghaziabad (UP)

The Tribunal upheld the assessee's grievance, ruling in favor of the appellant and deleting the late filing fee levy under section 234E. The Tribunal ... Levy of late filing fees u/s 234E in the course of processing under section 200A - Held that:- We find that the issue in appeal is covered by larger number of decisions, including several decisions of Ahmedabad benches of this tribunal in favour of the assessee. These decisions categorically hold that the amendment brought about in section 200A with effect from 1st June 2015 and by virtue of Finance Act, 2015 is prospective in effect and it cannot apply to the period prior to 1st June 2015. These appeals is now squarely covered in favour of the assessee by the decision of ITAT Amritsar Bench in the case of Sibia Healthcare Private Limited vs. DCIT [2015 (6) TMI 437 - ITAT AMRITSAR] adjustment in respect of levy of fees under section 234E was indeed beyond the scope of permissible adjustments contemplated under section 200A. We uphold the grievance of the assessee and delete the impugned levy of late filing fee u/s 234E - Decided in favour of assessee Issues Involved:1. Jurisdiction and permissibility of levying late filing fees under section 234E through the order of intimation under section 200A before 01.06.2015.2. Consideration of submissions, explanations, and information provided by the appellant.3. Retrospective effect of the amendment to section 200A with effect from 1st June 2015.Issue-Wise Detailed Analysis:1. Jurisdiction and Permissibility of Levying Late Filing Fees under Section 234E:The assessee challenged the correctness of the order passed by CIT(A)-8, Ahmedabad, regarding the levy of late filing fees under section 234E in the course of processing under section 200A for the assessment year 2014-15. The appellant argued that the CIT(A) erred in confirming the action of DCIT, TDS, CPC, Ghaziabad, as the levy of late filing fees under section 234E through the order of intimation under section 200A of the IT Act, 1961, before 01.06.2015, was without jurisdiction and not permissible either in law or on fact. The Tribunal noted that the issue in appeal was covered by a series of decisions in favor of the assessee, including the lead order in the case of Sibia Healthcare Private Limited Vs. DCIT, which held that prior to 1st June 2015, the levy of late filing fees under section 234E could not have been effected in the course of intimation under Section 200A of the Act.2. Consideration of Submissions, Explanations, and Information Provided by the Appellant:The appellant also contended that the CIT(A) grossly ignored various submissions, explanations, and information submitted by the appellant from time to time, which ought to have been considered before passing the impugned order. This action was claimed to be in clear breach of law and principles of natural justice. The Tribunal found that the CIT(A) had noted the binding judicial precedent but had gone on an elaborate analysis of the legal position, concluding that the amendment to section 200A with effect from 1st June 2015 was retrospective in effect. The Tribunal disapproved of the CIT(A)’s action, stating that the CIT(A) should have followed the binding judicial precedent rather than writing an antithesis of it.3. Retrospective Effect of the Amendment to Section 200A:The Tribunal examined whether the amendment brought about by the Finance Act, 2015, which allowed for the levy of fees under section 234E in the course of processing under section 200A, was retrospective in effect. The CIT(A) had held that the amendment was retrospective, relying on the decision in the case of Rajeev Kumar Agarwal Vs. Addl. CIT, which was approved by the Delhi High Court in CIT vs. Ansal Land Mark Township (P) Ltd. However, the Tribunal noted that the legal position, as settled by the Supreme Court in CIT vs. Vatika Townships (P) Ltd., was that when a tax legislation imposes a liability or a burden, the effect of such a legislative provision can only be prospective. The Tribunal concluded that the amendment in section 200A w.e.f. 1st June 2015 could not be retrospective in effect.Conclusion:In view of the above discussions, the Tribunal upheld the grievance of the assessee and deleted the impugned levy of late filing fee under section 234E of Rs. 39,200/-. The appeal of the assessee was allowed. The Tribunal emphasized that the CIT(A) should have followed the binding judicial precedent and noted that the amendment to section 200A could not be applied retrospectively. The judgment was pronounced in the open court on the 04th day of January, 2018.