Tribunal dismisses late fee appeals, allows reconsideration on untimely orders

The Tribunal dismissed four appeals challenging late fees under section 234E of the Income Tax Act, following the High Court's decision that section 234E was a charging provision for late filing fees. However, the Tribunal allowed five appeals for reconsideration concerning the timeliness of orders under section 200A(1) as they were not passed within one year.

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Issues:
Appeal against levy of late fees under section 234E of the Income Tax Act for delayed filing of quarterly tax deduction statements.

Analysis:
The case involved nine appeals by the assessee for assessment years 2013-14 to 2015-16 challenging the late fees levied under section 234E of the Income Tax Act. The appeals were related to the delay in filing quarterly statements of deduction of taxes under section 200(3) of the Act. The lead case, ITA 324/Ahd/2018, set the precedent for the remaining appeals.

The assessee had filed quarterly tax deduction statements for the relevant years, which were processed by the Income Tax Centralized Processing Cell TDS, resulting in a late filing fee of Rs. 5,29,994 being charged under section 234E of the Act. The assessee appealed to the CIT(A) contending that there was no provision prior to June 2015 for raising a demand for late fees under section 234E. However, the CIT(A) upheld the late fee charges.

During the appellate proceedings, the assessee cited judicial pronouncements and argued that the demand raised under section 234E was not authorized as section 200A did not include provisions for computing fees prior to June 2015. The departmental representative supported the lower authorities' orders.

The Tribunal considered the arguments and referred to a judgment of the jurisdictional High Court of Gujarat in a similar case. The High Court held that section 234E was a charging provision creating a fee for late filing of statements, and it was not necessary to have another provision like section 200A for the same purpose. The High Court clarified that section 200A was a machinery provision for processing statements and did not create a charge. Therefore, the Tribunal dismissed the appeals related to late fees but restored five appeals where orders under section 200A(1) were not passed within one year for fresh consideration.

In conclusion, the Tribunal dismissed four appeals challenging late fees under section 234E, following the High Court's decision. However, it allowed five appeals for reconsideration regarding the timeliness of orders under section 200A(1).

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