TaxTMI 
TaxTMI 
2022 (2) TMI 1061
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.... the background of requirement of clause (c) of Section 200A(1) read with Section 234E of the Income Tax Act, 1961 (for short, 'the Act'). W.A. No.600/2017 challenges the constitutional validity of Section 234E of the Act. The cases have been heard as batch matters. Though the petitioners/assessees are separate, we prefer to dispose of the appeals/petition by this common judgment since the circumstances preceding the filing of the respective cases, grounds of challenge, etc are substantially same and similar. 2.1 W.A. Nos.722, 752 & 753/2019 are treated as lead matters, and the circumstances referred to and considered in W.A. No.722/2019 is stated as representative appeal. W.A.No.722/2019 3. The Income Tax Officer (TDS)/2nd respondent in the writ petition is the appellant. M/s. Sarala Memorial Hospital, represented by its Managing Partner/respondent herein is the writ petitioner. The parties are referred to as arrayed in the writ petition. The petitioner challenged Exts.P1 to P6, prayed for a writ of certiorari, quash Exts.P1 to P6 as illegal etc. Exts. P1 to P6 are intimations received by the writ petitioner under Section 154 of the Act calling upon the writ petition....
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.... Judge to accept the contention of petitioner. The respondent/Revenue does not deal with the effect and applicability of Circular referred to in the judgment for challenging the impugned judgment. 6. The grounds raised against the judgment under appeal are dealing with the very same arguments considered by the learned Single Judge. It is useful, at this juncture, to excerpt the operative portion of the learned Single Judge's judgment: "9. Interpreting Section 200A and Section 234E, the Karnataka High Court has held in Fatheraj that when the statute confers no express power under section 200A before 01.06.2015 on the authority either to compute and collect any fee under section 234E, the demand for the period before 01.06.2015 could not be sustained. Fatheraj in fact observes: 14. We may now deal with the contentions raised by the learned counsel for the appellants. The first contention for assailing the legality and validity of the intimation under section 200A was that, the provision of section 200A(1)(c), (d) and (f) have come into force only with effect from 1.6.2015 and hence, there was no authority or competence or jurisdiction on the part of the conce....
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....ons of section 200A of the Income Tax Act did not provide for determination of fee payable under Section 234E of the Income Tax Act at the time of processing of TDS statements. Therefore, the provisions of Section 200A of the Income Tax Act has been amended so as to enable computation of fee payable under Section 234E of the Income Tax Act at the time of processing of TDS Statement under Section 200A of the Income Tax Act." (italics supplied) 6.1 A Division Bench of Karnataka High Court in W.A. Nos.2663-2674/2015 was answering the question whether clause (c) of Section 200A(1) is prospective or retrospective. The Division Bench held as follows: "20. In view of the aforesaid observations and discussion, two aspects may transpire one, for Section 234E providing for fee and given privilege to the defaulter if he pays the fee and hence, when a privilege is given for a particular purpose which in the present case is to come out from rigors of penal provision of Section 271H(1)(a), it cannot be said that the provisions of fee since creates a counter benefit or reciprocal benefit in favour of the defaulter in the rigors of the penal provision, the provisions of Section 234E....
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....rospective effect and not retrospective effect. Under the circumstances, we find that substitution made by clause (c) to (t) of sub-section (1) of Section 200A can be read as having prospective effect and not having retroactive character or effect. Resultantly, the demand under Section 200A for computation and intimation for the payment of fee under Section 234E could not be made in purported exercise of power under Section 200A by the respondent for the period of the respective assessment year prior to 1.6.2015. However, we make it clear that, if any deductor has already paid the fee after intimation received under Section 200A, the aforesaid view will not permit the deductor to reopen the said question unless he has made payment under protest. 23. In view of the aforesaid observation and discussion, since the impugned intimation given by the respondent Department against all the appellants under Section 200A are so far as they are for the period prior to 1.6.2015 can be said as without any authority under law. Hence, the same can be said as illegal and invalid." 6.2 Firstly, we are convinced with the reasoning and basis for the view taken by the learned Single Judge i....