TaxTMI 
TaxTMI 
2023 (6) TMI 868
X X X X Extracts X X X X
X X X X Extracts X X X X
....the Act; and main plea of the assessee against the imposition of late fees u/s 234E of the Act is that since the cause of action in both the appeals took place before 01.06.2015, the levy of 'late fee' u/s 234E of the Act is bad in law since the Hon'ble Jurisdictional High Court in the case of M/s. Sarala Memorial Hospital Vs. Union of India held that the amendment brought in by insertion of clause 'C' in section 200A(1) of the Act [Processing of statements of tax deducted at source] is prospective in nature; and that only post 01.06.2015, processing of return entails levy of late fee as envisaged u/s 234E of the Act. It would be gainful to refer to the relevant extracts of the order of the Hon'ble High Court which are germane to the issue ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e deductor specifying the sum determined to be payable by, or the amount of refund due to him under clause (c); and (e) amount of refund due to the deductor in pursuance of the determination under clause (c) shall be granted to the deductor; (f) the amount of refund due to the deductor in pursuance of the determination under clause (d) shall be granted to the deductor; Provided that no intimation under this sub-section shall be sent after the expiry of one year from the end of the financial year in which the statement is filed. Explanation.-For the purposes of this sub-section, "an incorrect claim apparent from any information in the statement" shall mean a claim, on the basis of an entry, in the statement- (i) of an item, wh....
X X X X Extracts X X X X
X X X X Extracts X X X X
....(1) shall be paid before delivering or causing to be delivered a statement in accordance with sub-section (3) of section 200 or the proviso to sub-section (3) of section 206C." 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 sec....
X X X X Extracts X X X X
X X X X Extracts X X X X
....cessing q statement for tax deduction and the method in which the same, would be done. When Section 234E has already created a charge for levying fee that would thereafter not have been necessary to have another provision creating the same charge. Viewing Section 200A as creating a new charge would bring about, dichotomy. In plain terms, the provision is a machinery provision and at best provides for a mechanism for processing and computing besides other, fee payable under section 234E for late filing of the statements" 11. There is cleavage in judicial opinion. But I am afraid, elaborate s the judgment may be in Rajesh Kourani, it does not seem to have considered the Circular No. 19 of 2015, which in para no. 47.3 clarifies: "47.3 Fi....
X X X X Extracts X X X X
X X X X Extracts X X X X
....f 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." At Paras 21 & 22 of the decision in Fatheraj Singhvi (supra) Hon'ble High Court (Kar) specifically held that the amendment vide Finance Act, 2015, w.e.f. 01/6/2015 would not have a retroactive effect as it confers a substantive power on the AO, and is not merely a regulatory mechanism, as held by the Hon'ble Gujarat High Court in Rajesh Kourani (supra). We also extract the afore-referred para 6.2, as follows, for ready reference: ....
X X X X Extracts X X X X
X X X X Extracts X X X X
..../s. 200A(1) for any period prior to 01.6.2015. In the light of the aforesaid decision of the Hon'ble Jurisdictional High Court, we find in the instant appeals that the 'late filing fee' u/s 234E of the Act has been levied for Quarter-4 ending for FY. 2012-13 Rs.6,200/- (ITA. No.887/Coch/2022) and late filing 'fee' u/s 234E of the Act for Quarter-2 for FY. 2012-13 at Rs.9,153/- (ITA. No.888/Coch/2022) has been levied. We note that only after 1st June, 2015 while processing of a TDS/TCS statement and issuance of intimation u/s 200A/206CB of the Act in respect thereof, an adjustment could have been made in respect of 'fee', if any shall be computed in accordance with the provisions of section 234E of the Act. Prior to 1st June, 2015, there was....