Late fee u/s 234F for delay in filing ITR deleted as CPC erred in due date applicable to partner

Late fee u/s 234F for delay in filing of ITR deleted as CPC erred in considering due date applicable to the partner assessee

ABCAUS Case Law Citation:
ABCAUS 3740 (2023) (05) ITAT

In the instant case, the assessee had challenged the order passed by the CIT(A) NFAC in confirming late fee u/s 234F of Income Tax Act, 1961 (the Act) for delay in furnishing of return of income for the relevant assessment year(s).

The appellant assessee was an individual. His return of income was processed by CPC u/s 143(1) of the Act.  An intimation was issued to the assessee u/s 143(1) of the Act imposing an amount of Rs. 5,000/- as fees u/s 234F of the Act on the ground that the return was filed after extended due date of filing of return.

The assessee filed a rectification petition u/s 154 of the Act against the aforesaid intimation u/s 143(1) requesting to delete the aforesaid levy of Rs. 5,000/- made u/s 234F of the Act.   

The assessee’s rectification petition was dismissed. Aggrieved, the assessee filed appeal with the office of Commissioner of Income Tax (CIT(A) who confirmed the late fee for default in furnishing return of income.

Before the ITAT, it was submitted that the assessee was a partner in a partnership firm and earned income by way of salary and interest from the partnership firm. It was further submitted that the aforesaid income by way of salary and interest from the partnership firm had been duly reflected by the assessee in the return of income.

It was also submitted that the said partnership firm was liable to get its accounts audited under relevant provisions of the Act.  Therefore, the due date of filing of return of income in the case of the assessee for the relevant assessment year was the due date applicable to the partnership firm and not the one applicable to normal individual.    

The Tribunal noted that there was no dispute that the assessee was a partner in partnership firm. It was also not in dispute that the aforesaid partnership firm was liable to get its accounts audited under the Act. It was further not in dispute that the assessee’s income from the aforesaid firm by way of salary and interest had already been reflected in the returns filed by the assessee.

The ITAT opined that under the facts and circumstances, the due date for filing of return applicable to the assessee was to be ascertained in accordance with Explanation 2(a)(iii) of Section 139(1) of the Act which was not the same as for a normal assessee.

Further, the Tribunal noted that for the relevant assessment year(s) the due date applicable to the assessee was extended by the CBDT vide orders passed u/s 119 of the Act.

The Tribunal held that the assessee had filed returns within the prescribed due dates and no case was made out for levy of fees u/s 234F.

Accordingly, the Tribunal directed the Assessing Officer to delete the late fees of Rs. 5,000/-

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