Tribunal rules in favor of Assessee, deleting late fee under Income-Tax Act

The Tribunal ruled in favor of the Assessee, directing the deletion of the late fee levied under section 234E of the Income-Tax Act for TDS returns filed before 1.6.2015. The Tribunal followed the decision of the jurisdictional High Court, holding that the levy of late fee was not valid based on the Karnataka High Court's decision. The Assessee's appeals were allowed, emphasizing the binding nature of the jurisdictional High Court's decisions on authorities within its jurisdiction.

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Issues:
Appeal against levy of late fee under section 234E of the Income-Tax Act for delayed filing of TDS statements for assessment years 2013-14 to 2015-16.

Detailed Analysis:
1. The Appellant filed 11 appeals against orders passed by the National Faceless Appeal Centre (NFAC) for late fee levied under section 234E of the Income-Tax Act due to delayed filing of TDS statements. The late fee is imposed at Rs. 200 per day for each day of delay in filing the TDS statement.

2. The Assessee contended that the provisions of section 234E were inserted by the Finance Act, 2012, effective from 1.7.2012. The Assessee argued that the authority could not levy the fee under section 234E for TDS statements filed before 1.6.2015, as the relevant provisions of section 200A came into force only from 1.6.2015. The Assessee relied on the decision of the Hon'ble Karnataka High Court in a similar case.

3. The NFAC/CIT(A) upheld the levy of late fee under section 234E, citing decisions from Madras, Gujarat, and Kerala High Courts, which supported the revenue's right to demand and collect the fee even without the provisions of section 200A. The Assessee appealed to the Tribunal against this decision.

4. The Tribunal considered the conflicting views of different High Courts but emphasized that the decision of the jurisdictional High Court, i.e., the Hon'ble Karnataka High Court, should be followed. The Tribunal held that the levy of late fee under section 234E for TDS returns filed before 1.6.2015 was not valid based on the Karnataka High Court's decision.

5. Referring to the case law, the Tribunal reiterated that the decision of the jurisdictional High Court is binding on the authorities within its jurisdiction. The Tribunal also highlighted a recent case where it was emphasized that the NFAC must follow the decision of the jurisdictional High Court, even if there are conflicting decisions from non-jurisdictional High Courts.

6. In conclusion, the Tribunal ruled in favor of the Assessee, directing the deletion of the late fee levied under section 234E of the Income-Tax Act. The Tribunal held that the levy of late fee for TDS returns filed before 1.6.2015 was not sustainable based on the decision of the jurisdictional High Court and allowed the Assessee's appeals.

This detailed analysis of the judgment provides a comprehensive understanding of the issues involved, the arguments presented by the parties, the decisions of the lower authorities, and the final ruling by the Tribunal, all while maintaining the legal terminology and significant details from the original text.

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