Tribunal Cancels Late Fee Penalties for TDS Statement Delay

The Tribunal allowed the assessee's appeals against late fee penalties imposed under section 234E for delayed filing of TDS statements. Relying on a Division Bench decision, the Tribunal held that the late fee provisions were prospective from June 1, 2015. In the absence of contrary binding precedents presented by the Revenue, the Tribunal directed the Assessing Officer to delete the penalties in all appeals within the consolidated batch. Consequently, the late fee penalties under section 234E were ordered to be deleted, and the appeals were allowed. The decision was pronounced on December 15, 2022.

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Issues:
Late fee penalty u/s 234E for late filing of TDS statements for various quarters and assessment years.

Analysis:
The appeals were filed against the Assessing Officer's orders levying late fee penalties under section 234E for delayed filing of TDS statements. The appeals covered multiple quarters and assessment years, which were consolidated for disposal. The primary argument was that the TDS returns were filed late but before specific dates, and the late fee was charged before a certain date. The assessee presented a detailed chart outlining the filing dates, delays, interest paid, and late fees charged for each quarter and assessment year.

The assessee relied on a Division Bench decision of the Tribunal and judgments from other courts to support their case. The Division Bench decision in a similar matter favored the assessee, stating that the late fee provisions introduced from June 1, 2015, were prospective in nature. It referred to conflicting decisions from different High Courts but emphasized following the view in favor of the assessee when faced with conflicting judgments. Consequently, the Division Bench directed the Assessing Officer to delete the late fee levied under section 234E for defaults before June 1, 2015.

The Tribunal noted that the Revenue did not present any other binding precedence favoring them. Therefore, based on the Division Bench's decision and the principles of following the view in favor of the assessee in conflicting judgments, the Tribunal directed the Assessing Officer to delete the impugned penalties in all appeals within the bunch. As a result, the assessee's appeals were allowed, and the late fee penalties under section 234E were ordered to be deleted. The order was pronounced in open court on December 15, 2022.

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