Section 234E late fees cannot be imposed for TDS returns filed before March 31, 2015

The ITAT Amritsar ruled in favor of the assessee regarding levy of late fees under section 234E for TDS statements filed beyond due date. The tribunal held that enabling clause (c) was inserted in section 200A effective from 01.06.2015, and prior to this date, there was no provision for raising demand for late fees under section 234E through section 200A. Following precedents from ITAT Agra and Karnataka HC, the tribunal concluded that late fees under section 234E cannot be imposed for TDS returns filed late under section 200A for periods prior to 31.03.2015, and deleted the demand.

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Issues Involved:
The judgment involves the levy of late fees under section 234E of the Income Tax Act, 1961, for two different assessment years, and the rejection of rectification applications under section 154.

Issue 1: Levy of Late Fees for Assessment Year 2013-14
The appellant, a Government Defence Department, filed quarterly TDS statements belatedly for F.Y. 2012-13, resulting in the imposition of late fees under section 234E. The Assessing Officer imposed late fees totaling Rs. 1,49,510, which was challenged through a rectification application under section 154. The appellant argued that prior to June 1, 2015, there was no provision allowing the levy of late fees under section 234E. The judgment cites precedents and legal provisions to support the appellant's contention that the late fees imposed were not legally sustainable.

Issue 2: Levy of Late Fees for Assessment Year 2014-15
The facts and grounds of appeal for Assessment Year 2014-15 mirror those of Assessment Year 2013-14, with the disputed late fees amounting to Rs. 68,320. Given the decision in favor of the appellant for the preceding year, the imposition of late fees for this assessment year was also deemed unjustified and subsequently canceled.

Conclusion:
The Appellate Tribunal, ITAT Amritsar, allowed both appeals of the assessee, ITA Nos. 334/Asr/2023 & 335/Asr/2023, concerning the levy of late fees under section 234E for the respective assessment years. The tribunal held that the late fees imposed on the delayed filing of TDS returns under section 200A could not be sustained, following legal precedents and the absence of enabling provisions prior to June 1, 2015. Consequently, the imposition of late fees was canceled for both assessment years, in line with the legal position established by the tribunal and other coordinating benches.

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