Retrospective application of new charging provisions barred; fee under the post enactment regime not leviable for pre enactment TDS periods.

Whether a post enactment machinery amendment can sustain demands for a newly created fee for earlier periods: the article explains that a machinery provision that was amended to provide for computation/intimation of a fee cannot be used to impose a charging provision retrospectively. The charging provision was introduced effective from its commencement date and, absent express retrospective effect, its liability cannot be visited on periods before that date. The operative effect: intimations issued under the amended processing provision cannot sustain fee demands for TDS periods predating the charging provision's commencement.

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Issues: Whether levy of late filing fee under section 234E of the Income-tax Act, 1961 by intimation issued under section 200A of the Income-tax Act, 1961 is sustainable for TDS statements pertaining to periods prior to 01.06.2015.

Analysis: Section 200A is a machinery provision for processing TDS statements and making adjustments; clauses (c) to (f) of section 200A were substituted w.e.f. 01.06.2015 to provide for computation/intimation of fee in accordance with section 234E. Section 234E is a charging provision introduced effective from 01.06.2015. Absent an enabling provision in section 200A prior to 01.06.2015, demands purportedly raised under section 200A for fee under section 234E for periods before 01.06.2015 amount to retrospective application of a substantive charging provision. The substituted provision and the charging mechanism operate prospectively unless expressly made retrospective; therefore demands for fee under section 234E based on section 200A intimation for periods prior to 01.06.2015 are not tenable. The Tribunal follows earlier consistent decisions applying the principle that where a statutory amendment creates a new charging mechanism from a specified date, liability cannot be imposed for earlier periods in absence of express retrospective effect.

Conclusion: Levy of fee under section 234E of the Income-tax Act, 1961 for TDS statements relating to periods prior to 01.06.2015, raised by intimation under section 200A of the Income-tax Act, 1961, is cancelled; appeals are allowed in favour of the assessee.

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