Late fee for delayed TDS statements could not be levied during processing before the Section 200A machinery amendment.

Late fee under Section 234E could not be computed or levied while processing TDS statements under Section 200A for assessment years before 01.06.2015, because the machinery provision in Section 200A(1)(c) came into force only from that date. Although Section 234E created the fee liability from 01.07.2012, the processing mechanism necessary to determine and impose the fee was absent for the earlier period. The later amendment was treated as supplying that missing mechanism, not as operating retrospectively. The impugned levy was therefore impermissible for the relevant earlier years and liable to be set aside.

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Issues: Whether late fee under Section 234E of the Income-tax Act, 1961 could be levied while processing TDS statements under Section 200A of the Income-tax Act, 1961 for assessment years prior to 01.06.2015.

Analysis: Section 234E created the liability for fee for delayed furnishing of TDS statements with effect from 01.07.2012, but the mechanism for computing and levying that fee during processing under Section 200A was introduced only by insertion of clause (c) to Section 200A(1) with effect from 01.06.2015. The objects and reasons for the amendment showed that the amendment was intended to supply the missing processing mechanism. For the relevant assessment years, the returns were processed under Section 200A before that machinery provision came into force, and the later amendment could not be applied retrospectively to sustain the impugned levy.

Conclusion: The levy of late fee under Section 234E while processing the TDS statements for the relevant assessment years was impermissible, and the impugned orders were liable to be set aside in favour of the petitioner.

Ratio Decidendi: A fee under Section 234E cannot be computed or levied at the stage of processing TDS statements under Section 200A for periods prior to the insertion of Section 200A(1)(c), because the processing machinery provision is a prerequisite for such levy.

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