Tribunal rules in favor of assessee on late fees, cites Karnataka High Court ruling.

The tribunal allowed all eleven appeals by the assessee, emphasizing the prospective application of late fees under section 234E as per the Karnataka High Court's ruling. The judgment maintained that the constitutional validity of section 234E remains open for further examination by the Division Bench.

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Issues:
Appeal against levy of late fee under section 234E of the Income Tax Act, 1961 for assessment years 2013-14, 2014-15, and 2015-16.

Analysis:
For the assessment year 2013-14, the appellant challenged the late fee imposed under section 234E by the DCIT, TDS (CPC), Ghaziabad. The appeal was dismissed by the ld. CIT(A) citing lack of reasonable cause for the delay. The main issue was the levy of late fees under section 234E, which the appellant contested. The Karnataka High Court's ruling in Fatheraj Singhvi vs. Union of India clarified that the late fees under section 234E can only be levied prospectively from 01.06.2015. The tribunal followed this precedent and directed the DCIT to delete the late fee imposed, as the demand notices were without legal authority for the period prior to 01.06.2015. The judgment emphasized that the constitutional validity of section 234E remains open for further examination by the Division Bench.

For the remaining appeals for assessment years 2014-15 and 2015-16, the tribunal applied the decision from the 2013-14 appeal mutatis mutandis. Consequently, all eleven appeals by the assessee were allowed based on the ruling regarding the prospective application of late fees under section 234E. The tribunal directed the deletion of late fees imposed by the DCIT in all cases.

In conclusion, the tribunal allowed all eleven appeals by the assessee, emphasizing the prospective application of late fees under section 234E as per the Karnataka High Court's ruling. The judgment maintained that the constitutional validity of section 234E remains open for further examination by the Division Bench.

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