Late fee for delayed TDS statements before 01.06.2015: s.234E fee via s.143(1) processing disallowed; levy deleted.

The dominant issue was whether late fee under s. 234E could be levied for delay in filing TDS statements for a period prior to 01.06.2015 while processing under s. 143(1). Applying its earlier decision, the ITAT held that, before 01.06.2015, the processing provisions did not permit imposition of s. 234E fee through an intimation under s. 143(1); accordingly, any such levy was without authority of law. The appeal was allowed and the late fee was deleted.

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1. ISSUES PRESENTED AND CONSIDERED

(i) Whether, for periods prior to 01.06.2015, a fee under section 234E could be levied while processing TDS statements (as reflected in the demand upheld by the first appellate authority), and whether such levy was sustainable in law.

2. ISSUE-WISE DETAILED ANALYSIS

Issue (i): Levy of fee under section 234E for pre-01.06.2015 period

Legal framework (as considered in the decision): The Court examined the permissibility of charging fee under section 234E in the context of processing of TDS statements, focusing on the effective date from which such levy could be made while processing, and applied the consistent view taken in Tribunal decisions referred to in the order.

Interpretation and reasoning: The Court treated the controversy as settled by consistent Tribunal view that, prior to 01.06.2015, no fee under section 234E was chargeable in the course of processing for delay in filing TDS returns. The Court relied on and followed the reasoning adopted in recent coordinate bench decisions (including a decision of the same Bench) holding that the levy of section 234E fee for earlier periods was not sustainable. The Court also noted that the same approach had been followed in another Delhi coordinate bench decision, and therefore applied judicial consistency in deciding the appeals.

Conclusions: The Court held that prior to 01.06.2015, no fee under section 234E is leviable for delay in filing TDS returns in the manner the fee had been charged and sustained. Consequently, the assessee's grounds on this point were allowed and the impugned sustenance of such fee was set aside, resulting in allowance of both appeals.

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