Levy of fee u/s 234E prior 01.06.2015. ITAT explains law on condonation of delay

Levy of fee us/ 234E prior to 01.06.2015. ITAT explains the law on condonation of delay by assessee in filing these appeals before the CIT(A)

ABCAUS Case Law Citation:
ABCAUS 2999 (2019) (06) ITAT

Important Case Laws Cited/relied upon by the parties:
Collector, Land Acquisition Vs. MST Katiji and Others (1987) 167 ITR 471 (SC),
Somerset Place Co-operative Housing Society Ltd., Vs. ITO (2015) 57 taxmann.com 7 (Bom)
First ITO Vs. A. N. Mafatlal (HUF) (1982) 2 ITD 61 (Bom)
Fatheraj Singhvi and Others Vs. UOI,

The assessee’s appeals was against the orders of CIT(A) for non-admission of the assessee’s appeals against the intimations issued by ACIT-TDS-CPC u/s 200A of the Income Tax Act, 1961 (the Act) requiring the assessee to pay late filing fees u/s 234E of the Act; by not condoning the delay in filing the appeals before him.  

The assessee filed the TDS statements for 4^th Quarter of Financial Year 2012-13. Subsequent thereto, the assessee received an intimation from ACIT, CPC-TDS, under section 200A of the Act levying fees under section 234E of the Act.

On appeal, the CIT(A) dismissed the assessee’s appeal, in limine, by refusing to condone the delay in filing the appeal before him.

The issue raised by the assessee was charging of late fees payable u/s 234E of the Act prior to the amendment to section 200A(1)(c) of the Act while processing the TDS returns. It was the assessee’s contention that the legislature had inserted clause (c) to section 200(1) of the Act specifically w.e.f. 01.06.2015 and therefore in respect of TDS statements filed for the period prior to 01.06.2015, late fees u/s 234E of the Act could not be levied in the intimation issued u/s 200A of the Act.

The issue of levy of fees under section 234E of the Act by means of issuing of intimation under section 200A prior to the amendment of Section 200A (1)(c) of the Act vide Finance Act, 2015, w.e.f. 01.06.2015 was under challenge in the Courts.

The Hon’ble jurisdictional High Court had quashed the intimation under section 200A of the Act by holding that there was no power under section 200A of the Act to levy any late fee under section 234E of the Act prior to the amendment to the section w.e.f. 01.06.2015.

It was submitted that only after the Hon’ble High Court had quashed the intimation issued under section 200A charging / levying fees under section 234E of the Act prior to 01.06.2015, the assessee had reason to file appeals before the CIT(A) and this, constituted “sufficient cause” for condoning the delay in filing both the present appeals before the CIT(A).

It was contended that the CIT(A) was wrong in not admitting both the appeals on technical grounds, which was also wrong.

The Tribunal opined that in view the decision of the Hon’ble High Court of judicature, the assessee has a favourable case on merits. When there is a decision of the jurisdictional High Court, judicial discipline and propriety requires that we are duty bound to follow the same.  The said decision of the Hon’ble High Court was squarely applicable to the facts of the case on hand.

The Tribunal stated that on the issue of condonation of delay on the part of the assessee in filing these appeals before the CIT(A) the settled principle, upheld and followed in a catena of decisions is that the expression “sufficient cause” ought to be interpreted in a manner which subserves and advances the cause of substantial justice. A case with arguable / favourable points / contentions on merits should not be shut out on the presumption of limitation, leading to such a case being thrown out at the threshold itself in limine.

The Tribunal observed that the Hon’ble Apex Court while laying down the principles for considering matters of condonation of delay in filing appeals, had stated that substantial justice should prevail over technical considerations.

Considering the aforesaid principles laid down by the Hon’ble Supreme Court, the facts and peculiar circumstances of the case on hand, the Tribunal opined that it was a fit case for condoning the delay in filing the nine appeals before the CIT(A).

Accordingly, the Tribunal condoned the delay and remanded the issue of levy of fee u/s 234E of the Act through intimation under section 200A, to the file of the CIT(A) for examination and adjudication on merits.  

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