Solanki Polymers Pvt. Ltd.,, Jalgaon v. Deputy Commissioner of Income-tax,,

ITA 1622/PUN/2014 | 2013-2014
Pronouncement Date: 30-09-2016 | Result: Allowed

Appeal Details

RSA Number 162224514 RSA 2014
Assessee PAN AAFCS9224G
Bench Pune
Appeal Number ITA 1622/PUN/2014
Duration Of Justice 2 year(s) 1 month(s) 3 day(s)
Appellant Solanki Polymers Pvt. Ltd.,, Jalgaon
Respondent Deputy Commissioner of Income-tax,,
Appeal Type Income Tax Appeal
Pronouncement Date 30-09-2016
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted B
Tribunal Order Date 30-09-2016
Date Of Final Hearing 28-09-2016
Next Hearing Date 28-09-2016
Assessment Year 2013-2014
Appeal Filed On 27-08-2014
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH B PUNE BEFORE MS. SUSHMA CHOWLA JM AND SHRI ANIL CHATURVEDI AM SL. NO. ITA/CO NO. NAME OF APPELLANT NAME OF RESPONDENT ASST. YEAR QUARTER FORM 1 - 4 1619 /PN/201 4 TO 1622 /PN/201 4 SOLANKI POLYMERS PVT. LTD. 4 LUNKAD TOWER NEAR GPO JILHA PETH JALGAON - 425001 PAN: AA FCS9224G D CIT (CPC) - TDS GHAZIABAD 201 3 - 1 4 2013 - 14 2013 - 14 2013 - 14 QR - 2 QR - 2 QR - 3 QR - 3 2 6 Q 24Q 24Q 26Q / APPELLANT BY : SMT. DEEPA KHARE / RESPONDENT BY : SHRI P.L. KUREEL HEARD ON : 28 .0 9 .2016 SL. NO. ITA/CO NO. NAME OF APPELLANT NAME OF RESPONDENT ASST. YEAR QUARTER FORM 5 - 7 1623/PN/2014 TO 1625 /PN/201 4 SHRIRAM PRABHAKAR DAMLE 294 SHRINIVAS IRON D CIT (CPC) - TDS GHAZIABAD 201 3 - 1 4 2013 - 14 2013 - 14 QR - 2 QR - 3 QR - 4 26Q 26Q 26Q 1625 /PN/201 4 294 SHRINIVAS IRON WORKS BALIRAM PETH JALGAON 425001 PAN: AAKPD3898F GHAZIABAD 2013 - 14 QR - 4 26Q / APPELLANT BY : SMT. DEEPA KHARE / RESPONDENT BY : SHRI P.L. KUREEL HEARD ON : 2 9 .0 9 .2016 / ORDER PER SUSHMA CHOWLA JM: THIS BUNCH OF APPEALS FILED BY DIFFERENT ASSESSEE ARE AGAINST RESPECTIVE ORDERS OF CIT(A) RELATING TO ASSESSMENT YEAR 2013 - 14 AGAINST RESPECTIVE / DATE OF HEARING : 28 .0 9 .201 6 / 29.09.2016 / DATE OF PRONOUNCEMENT: 30 . 0 9 . 201 6 2 INTIMATION ISSUED UNDER SECTION 200A (3) OF THE INCOME - TAX ACT 1961 (I N SHORT THE ACT) . 2. BUNCH OF PRESENT APPEALS RELATING TO DIFFERENT ASSESSEE WERE HEARD TOGETHER ON DIFFERENT DATES AND ARE BEING DISPOSED OF BY THIS CONSOLIDATED ORDER AS THE ISSUE RAISED IN ALL THESE APPEALS WAS SIMILAR. 3. THE ISSUE ARISING IN THIS BUNCH OF APPEALS IS AGAINST THE INTIMATION ISSUED UNDER SECTION 200A OF THE ACT UNDER WHICH THE ASSESSING OFFICER HAS CHARGED FEES PAYABLE UNDER SECTION 234E OF THE ACT. 4. THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE AT THE OUTSET POI NTED OUT THAT THE ISSUE ARISING IN THE PRESENT APPEALS IS COVERED BY THE ORDER OF TRIBUN AL IN BUNCH OF APPEALS WITH LEAD ORDER IN ITA NOS. 560/PN/2016 & 561/PN/2016 1018/PN/2016 TO 1023/PN/2016 IN MAHARASHTRA CRICKET ASSOCIATION VS. DCIT (CPC) - TDS GHAZIABAD RELATING TO ASSESSMENT YEARS ASSOCIATION VS. DCIT (CPC) - TDS GHAZIABAD RELATING TO ASSESSMENT YEARS 2013 - 14 AND 2014 - 15 ORDER DATED 21.09.2016. 5. THE ISSUE WHICH ARISES IN THIS SET OF APPEALS IS CHARGING OF FEES PAYABLE UNDER SECTION 234E OF THE ACT PRIOR TO AMENDMENT TO SECTION 200A(1)( C ) OF THE ACT VIDE FINA NCE ACT 2015 W.E.F. 01.06.2015 WHILE PROCESSING THE TDS RETURNS BY THE ASSESSING OFFICER AND ISSUING THE INTIMATION IN THIS REGARD. THE CASE OF THE ASSESSEE BEFORE US WAS THAT WHERE THE LEGISLATURE HAD INSERTED CLAUSE (C) TO SECTION 200A(1) OF THE ACT S PECIFICALLY W.E.F. 01.06.2015 AND WHERE THERE IS NOTHING TO SUGGEST THAT THE SAID AMENDMENT WAS CLARIFICATORY OR RETROSPECTIVE IN NATURE HENCE IN RESPECT OF TDS STATEMENTS FILED FOR THE PERIOD PRIOR TO 01.06.2015 LATE FEES CHARGED UNDER SECTION 234E OF T HE ACT COULD NOT BE LEVIED IN THE INTIMATION ISSUED UNDER SECTION 200A OF THE ACT. 3 6. BRIEFLY IN THE FACTS OF THE CASE THE ASSESSEE WAS REQUIRED TO DEDUCT TAX AT SOURCE OUT OF PAYMENTS MADE ON ACCOUNT OF INTEREST FOR THE RESPECTIVE QUARTERS IN THE ACCOUN TING PERIOD 2012 - 13 . THE ASSESSEE WAS REQUIRED TO FILE QUARTERLY TDS RETURNS INTIMATING THE TAX DEDUCTED AT SOURCE FROM VARIOUS PAYMENTS MADE IN EACH OF THE QUARTER AS PER SECTION 200(3) OF THE ACT. FURTHER THE REQUIREMENT OF THE ACT WAS TO FILE THE SAID TDS RETURNS WITHIN STIP ULATED PERIOD AS PROVIDED UNDER THE SECTION. ADMITTEDLY IN THE PRESENT APPEALS THE TDS RETURNS WERE FILED BELATEDLY . THE ASSESSING OFFICER WHILE PROCESSING THE TDS RETURNS ISSUED INTIMATION TO THE RESPECTIVE ASSESSEE UNDER SECTION 200A OF THE ACT AND L EVIED LATE FILING FEES UNDER SECTION 234E OF THE ACT. 7. IN APPEAL THE CIT(A) HELD THAT THE ASSESSING OFFICER WAS EMPOWERED TO RAISE THE SAID DEMAND UNDER SECTION 234E OF THE ACT WHILE ISSUING INTIMATION UNDER SECTION 200A OF THE ACT. 8. THE ASSESSEE IS IN APPEAL AGAINST THE ORDERS OF AUTHORITIES BELOW. 9. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE RECORD. THE ISSUE ARISING IN THE PRESENT APPEALS I.E. AGAINST LEVY OF FEES UNDER SECTION 234E OF THE ACT WHILE ISSUING INTIMATION UNDER SECTION 200A OF THE ACT AROSE BEFORE THE TRIBUNAL IN BUNCH OF APPEALS. THE TRIBUNAL VIDE ORDER DATED 21.09.2016 WITH LEAD ORDER IN ITA NOS. 560/PN/2016 & 561/PN/2016 1018/PN/2016 TO 1023/PN/2016 IN MAHARASHTRA CRICKET ASSOCIATION VS. DCIT (CPC) - TDS GHAZIABAD RELATING TO ASSESSMENT YEARS 2013 - 14 AND 2014 - 15 FOR THE RESPECTIVE QUARTERS DELIBERATED UPON THE ISSUE AND HELD AS UNDER: - 16. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE RECORD. THE ISSUE ARISING IN THIS BUNCH OF APPEALS IS AGAINST LEVY OF FEES UNDER SECTION 234E OF THE ACT. IN ORDER TO ADJUDICATE THE ISSUE FIRST REFERENCE IS BEING MADE TO THE RELEVANT PROVISIONS OF THE ACT. UNDER CHA PTER XVII HEADED COLLECTION AND RECOVERY OF TAXES AND UNDER CLAUSE B DEDUCTION AT SOURCE THE STATUTE LAYS DOWN THE DUTY OF THE PAYER OF CERTAIN AMOUNTS TO DEDUCT TAX AT SOURCE UNDER 4 SECTIONS 192 TO 194LD 195 TO 196D OF THE ACT . UNDER SECTION 198 OF THE ACT IT IS PROVIDED THAT THE TAX DEDUCTED AT SOURCE SHALL FOR THE PURPOSE OF COMPUTING THE INCOME OF ASSESSEE BE DEEMED TO BE INCOME RECEIVED. UNDER SECTION 199 OF THE ACT IT IS FURTHER PROVIDED THAT ANY DEDUCTION MADE IN ACCORDANCE WITH THE PROVISIONS OF CHAPTER AND PAID TO THE CENTRAL GOVERNMENT SHALL BE TREATED AS PAYMENT OF TAX ON BEHALF OF THE PERSON FROM WHOSE INCOME THE DEDUCTION WAS MADE. THE SUM REFERRED TO IN SUB - SECTION (1 A ) OF SECTION 192 OF THE ACT AND PAID TO THE CENTRAL GOVERNMENT SHALL BE TREATED AS THE TAX PAID ON BEHALF OF THE PERSON IN RESPECT OF WHOSE INCOME SUCH PAYMENT OF TAX HAS BEEN MADE. 17. SECTION 200 OF THE ACT LAYS DOWN THE DUTY OF THE PERSON DEDUCTING TAX WHICH READS A S UNDER: - 200. (1) ANY PERSON DEDUCTING ANY SUM IN ACCORDANCE WITH THE FOREGOING PROVISIONS OF THIS CHAPTER SHALL PAY WITHIN THE PRESCRIBED TIME THE SUM SO DEDUCTED TO THE CREDIT OF THE CENTRAL GOVERNMENT OR AS THE BOARD DIRECTS. (2) ANY PERSON BEING AN EMPLOYER REFERRED TO IN SUB - SECTION (1A) OF SECTION 192 SHALL PAY WITHIN THE PRESCRIBED TIME THE TAX TO THE CREDIT OF THE CENTRAL GOVE RNMENT OR AS THE BOARD DIRECT S. (2A) IN CASE OF AN OFFICE OF THE GOVERNMENT WHERE THE SUM DEDUCTED IN ACCORDANCE WITH THE FOREGOING PROVISIONS OF THIS CHAPTER OR TAX REFERRED TO IN SUB - SECTION(1A) OF SECTION 192 HAS BEEN PAID TO THE CREDIT OF THE CENTRAL GOVERNMENT WITHOUT THE PRODUC TION OF A CHALLAN THE PAY AND ACCOUNTS OFFICER OR THE TREASURY OFFICER OR THE CHEQUE DRAWING AND DISBURSING OFFICER OR ANY OTHER PERSON BY WHATEVER NAME CALLED WHO IS RESPONSIBLE FOR CREDITING SUCH SUM OR TAX TO THE CREDIT OF THE CENTRAL GOVERNMENT SHALL DELIVER OR CAUSE TO BE DELIVERED TO THE PRESCRIBED INCOME - TAX AUTHORITY OR TO THE PERSON AUTHORISED BY SUCH AUTHORITY A STATEMENT IN SUCH FORM VERIFIED IN SUCH MANNER SETTING FORTH SUCH PARTICULARS AND WITHIN SUCH TIME AS MAY BE PRESCRIBED. (3) A NY PERSON DEDUCTING ANY SUM ON OR AFTER THE 1ST DAY OF APRIL 2005 (3) A NY PERSON DEDUCTING ANY SUM ON OR AFTER THE 1ST DAY OF APRIL 2005 IN ACCORDANCE WITH THE FOREGOING PROVISIONS OF THIS CHAPTER OR AS THE CASE MAY BE ANY PERSON BEING AN EMPLOYER REFERRED TO IN SUB - SECTION (1A) OF SECTION 192 SHALL AFTER PAYING THE TAX DEDUCTED TO THE CREDIT OF THE CENTRAL GOVERNMENT WITHIN THE PRESCRIBED TIME PREPARE SUCH STATEMENTS FOR SUCH PERIOD AS MAY BE PRESCRIBED AND DELIVER OR CAUSE TO BE DE LIVERED TO THE PRESCRIBED INCOME - TAX AUTHORITY OR THE PERSON AUTHORISED BY SUCH AUTHORITY SUCH STATEMENT IN SUCH FORM AND VERIFIED IN SUCH MANNER AND SETTING FORTH SUCH PARTICULARS AND WITHIN SUCH TIME AS MAY BE PRESCRIBED: PROVIDED THAT THE PERSON MAY ALS O DELIVER TO THE PRESCRIBED AUTHORITY A CORRECTION STATEMENT FOR RECTIFICATION OF ANY MISTAKE OR TO ADD DELETE OR UPDATE THE INFORMATION FURNISHED IN THE STATEMENT DELIVERED UNDER THIS SUB - SECTION IN SUCH FORM AND VERIFIED IN SUCH MANNER AS MAY BE SPECIFI ED BY THE AUTHORITY. 18. UNDER SECTION 200 (1) OF THE ACT IT IS PROVIDED THAT ANY PERSON DEDUCTING ANY SUM IN ACCORDANCE WITH THE PROVISIONS OF TH E CHAPTER SHALL PAY WITHIN THE PRESCRIBED TIME THE SUM SO DEDUCTED TO THE CREDIT OF THE CENTRAL GOVERNMENT OR AS THE BOARD DIRECTS. UNDER SECTION 200 (2) OF THE ACT ANY PERSON BEING AN EMPLOYER AS REFERRED TO IN SUB - SECTION (1A) OF SECTION 192 OF THE ACT SHALL PAY WITHIN THE PRESCRIBED TIME THE TAX TO THE CREDIT OF THE CENTRAL GOVERNMENT OR AS THE BOARD DIRECTS. UNDER SUB - SECTION (2A) OF THE AC T IT IS PROVIDED THAT WHERE THE SUM HAS BEEN DEDUCTED IN ACCORDANCE WITH FOREGOING PROVISIONS OF THE CHAPTER BY THE OFFICE OF THE GOVERNMENT THEN DUTY IS UPON THE TREASURY OFFICER OR THE DRAWING & DISBURSING OFFICER OR ANY OTHER PERSON TO DELIVER OR CA USE TO BE DELIVERED TO THE PRESCRIBED INCOME TAX AUTHORITIES OR TO THE PERSON AUTHORIZED BY SUCH AUTHORITY STATEMENT IN SUCH FORM VERIFIED IN SUCH MANNER SETTING FORTH SUCH PARTICULARS WITHIN SUCH TIME AS MAY BE PRESCRIBED. UNDER 5 SECTION 200 (3) OF THE ACT SIMILAR RESPONSIBILITY IS ON ANY PERSON DEDUCTING ANY SUM ON OR AFTER FIRST DAY OF APRIL 2005 IN ACCORDANCE WITH FOREG OING PROVISIONS OF THE CHAPTER INCLUDING ANY PERSON AS AN EMPLOYER REFERRED TO IN SECTION 192(1A) OF THE ACT. THE ONUS IS UPON SUCH PERSON THAT HE SHALL AFTER PAYING THE TAX TO THE CREDIT OF CENTRAL GOVERNMENT WITHIN PRESCRIBED TIME PREPARE SUCH STATEMENT FOR SUCH PERIOD AS MAY BE PRESCRIBED AND DELIVER OR CAUSE TO BE DELIVERED TO THE PRESCRIBED INCOME TAX AUTHORITY OR ANY PERSON SO AUTHORIZED SUCH STATEMENT IN SUCH FORM AND VERIFIED IN SUCH MANNER AND SETTING FORTH SUCH PARTICULARS AND WITHIN SUCH TIME AS MAY BE PROVIDED. THE DUTY IS UPON A PERSON DEDUCTI NG ANY SUM IN ACCORDANCE WITH VARIOUS PROVISIONS UNDER THE CHAPTER AND ALSO UPON AN EMPLOYER WHO IS MAKING DEDUCTION OUT OF THE PAYMENTS MADE TO THE EMPLOYEES THEN SUB - SECTION (3) REQUIRES THAT THE DEDUCTOR IS TO PREPARE A STATEMENT FOR SUCH PERIOD AS MAY BE PRESCRIBED WHICH IS TO BE DELIVERED TO THE PRESCRIBED AUTHORITY IN SUCH FORM AND VERIFIED AND SETTING FORTH SUCH PARTICULARS AS MAY BE PRESCRIBED. THE SAID STATEMENT IS TO BE DELIVERED WITHIN SUCH TIME AS MAY BE PRESCRIBED. 19. RULE 31A OF THE INCO ME TAX RULES 1962 (IN SHORT THE RULES) PROVIDES THAT EVERY PERSON WHO IS RESPONSIBLE FOR DEDUCTION OF TAX UNDER CHAPTER XVIIB SHALL IN ACCORDANCE WITH THE PROVISIONS OF SECTION 200(3) OF THE ACT DELIVER OR CAUSE TO BE DELIVERED THE QUARTERLY STATEMENT S TO THE DIRECTOR GENERAL OF INCOME TAX (SYSTEMS) OR THE PERSONS AUTHORIZED BY THEM I.E. IN RESPECT OF DEDUCTIONS UNDER VARIOUS PROVISIONS OF THE CHAPTER XVIIB. THE RULE FURTHER PROVIDES THAT THE STATEMENTS REFERRED TO IN SUB - RULE (1) ARE TO BE DELIVERED QUARTERLY AND THE STIPULATED PERIOD OF DUE DATE OF FILING THE SAID STATEMENT IN RESPECT OF DEDUCTOR BEING AN OFFICE OF THE GOVERNMENT AND THE DEDUCTOR BEING OTHER THAN GOVERNMENT ARE PROVIDED. THE SUB - RULE (3) OF RULE 31A OF THE RULES FURTHER PROVIDES THAT THE STATEMENT REFERRED TO IN SUB - RULE (1) MAY BE FURNISHED IN ANY OF THE FOLLOWING MANNERS I.E. BY WAY OF FURNISHING THE STATEMENT IN PAPER FORM OR FURNISHING THE STATEMENT ELE CTRONICALLY UNDER DIGITAL SIGNATURE OR AFTER VERIFICATION. INITIALLY SUCH STATEMENT HAD TO BE FURNISHED IN PAPER FORM AND LATER BY WAY OF AMENDMENT THE PROCEDURE FOR FURNISHING THE STATEMENT ELECTRONICALLY BY WAY OF AMENDMENT THE PROCEDURE FOR FURNISHING THE STATEMENT ELECTRONICALLY WAS PROVIDED. ONCE THE STATEMENT HAS BEEN SO S UBMITTED BY THE DEDUCTOR OF TAX DEDUCTED AT SOURCE THEN PROCESSING OF STATEMENT IS AS PER THE PROVISIONS OF SECTION 200A OF THE ACT. THE SAID SECTION WAS INSERTED BY THE FINANCE (NO.2) ACT 2009 W.E.F. 01.04.2010. THE SAID SECTION 200A OF THE ACT READS AS UNDER: - 200A. (1) WHERE A STATEMENT OF TAX DEDUCTION AT SOURCE OR A CORRECTION STATEMENT HAS BEEN MADE BY A PERSON DEDUCTING ANY SUM (HEREAFTER REFERRED TO IN THIS SECTION AS DEDUCTOR) UNDER SECTION 200 SUCH STATEMENT SHALL BE PROCESSED IN THE FOLLOWING MANNER NAMELY: (A) THE SUMS DEDUCTIBLE UNDER THIS CHAPTER SHALL BE COMPUTED AFTER MAKING THE FOLLOWING ADJUSTMENTS NAMELY: (I) ANY ARITHMETICAL ERROR IN THE STATEMENT; OR (II) AN INCORRECT CLAIM APPARENT FROM ANY INFORMATION IN THE STATEMENT; (B) THE INTEREST IF ANY SHALL BE COMPUTED ON THE BASIS OF THE SUMS DEDUCTIBLE AS COMPUTED IN THE STATEMENT; (C) THE SUM PAYABLE BY OR THE AMOUNT OF REFUND DUE TO THE DEDUCTOR SHALL BE DETERMINED AFTER ADJUSTMENT OF AMOUNT COMPUTED UNDER CLAUSE (B) AGAINST ANY AMOUNT PAID UNDER SECTION 200 AND SECTION 201 AND ANY AMOUNT PAID OTHERWISE BY WAY OF TAX OR INTEREST; (D) AN INTIMATION SHALL BE PREPARED OR GENERATED AND SENT TO THE DEDUCTOR SPECIFYING THE SUM DETE RMINED TO BE PAYABLE BY OR THE AMOUNT OF REFUND DUE TO HIM UNDER CLAUSE (C); AND (E) THE AMOUNT OF REFUND DUE TO THE DEDUCTOR IN PURSUANCE OF THE DETERMINATION UNDER CLAUSE (C) SHALL BE GRANTED TO THE DEDUCTOR : 6 PROVIDED THAT NO INTIMATION UNDER THIS S UB - 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 CL AIM ON THE BASIS OF AN ENTRY IN THE STATEMENT (I) OF AN ITEM WHICH IS INCONSISTENT WITH ANOTHER ENTRY OF THE SAME OR SOME OTHER ITEM IN SUCH STATEMENT; (II) IN RESPECT OF RATE OF DEDUCTION OF TAX AT SOURCE WHERE SUCH RATE IS NOT IN ACCORDANCE WITH THE PROVISIONS OF THIS ACT. (2) FOR THE PURPOSES OF PROCESSING OF STATEMENTS UNDER SUB - SECTION (1) THE BOARD MAY MAKE A SCHEME FOR CENTRALISED PROCESSING OF STATEMENTS OF TAX DEDUCTED AT SOURCE TO EXPEDITIOUSLY DETERMINE THE TAX PAYABLE BY OR THE REFUND DUE TO THE DEDUCTOR AS REQUI RED UNDER THE SAID SUB - SECTION. 20. SECTION 200A OF THE ACT LAYS DOWN THE MANNER IN WHICH THE STATEMENTS OF TAX DEDUCTED AT SOURCE ARE TO BE PROCESSED FOR ISSUING THE INTIMATION . FIRST OF ALL THE SUMS DEDUCTIBLE UNDER THE CHAPTER ARE TO BE COMPUTED AND INTEREST IF ANY SHALL BE COMPUTED ON THE BASIS OF SUCH SUMS DEDUCTIBLE AS COMPUTED IN THE STATEMENTS AS PER CLAUSE (A) AND (B) UNDER SECTION 200A(1) OF THE ACT. CLAUSES (C) TO (F) REPRODUCED ABOVE WERE SUBSTITUTED FOR CLAUSES (C) TO (E) BY THE FINANCE ACT 2015 W.E.F. 01.06.2015. PRIOR TO THE SUBSTITUTION CLAUSES (C) TO (E) READ AS UNDER: - (C) THE SUM PAYABLE BY OR THE AMOUNT OF REFUND DUE TO THE DEDUCTOR SHALL BE DETERMINED AFTER ADJUSTMENT O F AMOUNT COMPUTED UNDER CLAUSE (B) AGAINST ANY AMOUNT PAID UNDER SECTION 200 AND SECTION 201 AND ANY AMOUNT PAID OTHERWISE BY WAY OF TAX OR INTEREST; (D) AN INTIMATION SHALL BE PREPARED OR GENERATED AND SENT TO THE DEDUCTOR SPECIFYING THE SUM DETERMINED TO BE PAYABLE BY OR THE DEDUCTOR SPECIFYING THE SUM DETERMINED TO BE PAYABLE BY OR THE AMOUNT OF REFUND DUE TO HIM UNDER CLAUSE (C); AND (E) THE AMOUNT OF REFUND DUE TO THE DEDUCTOR IN PURSUANCE OF THE DETERMINATION UNDER CLAUSE (C) SHALL BE GRANTED TO THE DEDUCTOR. 21. AS PER NEWLY SUBSTITUTED CLAUSE (C) W.E.F. 01.06.2015 THE FEES IF ANY IS TO BE COMPUTED IN ACCORDANCE WITH THE PROVISIONS OF SECTION 234E OF THE ACT. HOWEVER UNDER THE EARLIER CLAUSE (C) THERE WAS NO SUCH PROVISION. 22. SECTION 234E(1) OF THE ACT PROVIDES THAT WHERE A PERSON FAILS TO DELIVER OR CAUSE TO BE DELIVERED A STATEMENT WITHIN TIME PRESCRIBED IN SECTION 200(3) OF THE ACT OR THE PROVISO TO SECTION 206C(3) OF THE ACT HE SHALL BE LIABLE TO PAY BY WAY OF FEES SUM OF RS.200/ - FOR EVERY DAY DURING WHICH THE FAILURE CONTINUES. T HE SAID PROVISIONS WERE INSERTED BY THE FINANCE ACT 2012 W.E.F. 01.07.2012. UNDER SUB - SECTION (2) IT IS FURTHER PROVIDED THAT THE AMOUNT OF FEES REFERRED TO IN SUB - SECTION (1) SHALL NOT EXCEED THE AMOUNT OF TAX DEDUCTIBLE OR COLLECTABLE AS THE CASE MAY BE. SUB - SECTION (3) FURTHER LAYS DOWN THAT THE AMOUNT OF FEES REFERRED TO IN SUB - SECTION (1) SHALL BE PAID BEFORE DELIVERING OR CAUSING TO BE DELIVERED A STATEMENT IN ACCORDANCE WITH SUB - SECTION 200(3) OF THE ACT OR THE PROVISO TO SECTION 206C(3) OF THE ACT. THE PROVISIONS OF SAID SECTION HAVE BEEN MADE APPLICABLE TO A STATEMENT TO BE DELIVERED OR CAUSE TO BE DELIVERED ON OR AFTER THE FIRST DAY OF JULY 2012. 23. READING THE ABOVE SAID PROVISIONS OF THE ACT IT TRANSPIRES THAT WHERE TAX HAS BEEN DEDUCTED AT SOURCE BY A DEDUCTOR OUT OF THE ACCOUNT OF DEDUCTEE THEN THE ONUS IS UPON THE DEDUCTOR UNDER SECTION 200 OF THE ACT TO PREPARE A STATEMENT IN SUCH FORM AND VERIFIED IN SUCH MANNER WHICH IS PRESCRIBED UND ER THE ACT IN WHICH THE PARTICULARS OF TAX DEDUCTION AT SOURCE ARE TO BE PROVIDED AND THE SAID STATEMENT IS TO BE DELIVERED OR CAUSE TO BE DELIVERED WITHIN SUCH TIME 7 AS MAY BE PRESCRIBED. RULE 31A OF THE RULES PROVIDE D THE TIME LIMIT FOR THE FURNISHING OF STATE MENT FOR TAX DEDUCTION AT SOURCE ON QUARTERLY BASIS. SECTION 234E OF THE ACT LEVIES FEES FOR DEFAULT IN FURNISHING THE STATEMENTS OF TAX DEDUCTED AT SOURCE. SUCH FEES IS TO BE PAID BEFORE DELIVERING OR CAUSING TO BE DELIVERED A STATEMENT IN ACCORDA NCE WITH SECTION 200(3) OF THE ACT OR PROVISO TO SECTION 206C(3) OF THE ACT. IN OTHER WORDS IN CASE THE ASSESSEE HAS DEFAULTED IN NOT DELIVERING THE STATEMENT OR CAUSING TO DELIVER THE STATEMENT WITHIN TIME PRESCRIBED THEN HE IS LIABLE TO PAY THE FEES W HICH IS SO PRESCRIBED UNDER THE ACT AND SUCH FEES SHALL NOT EXCEED THE AMOUNT OF TAX DEDUCTIBLE OR COLLECTABLE AT SOURCE BUT THE SAME HAS TO BE PAID ALONG WITH STATEMENT WHICH IS TO BE DELIVERED UNDER THE PROVISIONS OF SECTION 200(3) OF THE ACT. THOUGH THE STATEMENT OF TAX DEDUCTED AT SOURCE HAS TO BE FURNISHED BY THE DEDUCTOR NO DOUBT UNDER SECTION 200 OF THE ACT BUT THE SAME HAS TO BE PROCESSED BY THE PRESCRIBED AUTHORITY AS PER PROVISIONS OF SECTION 200A OF THE ACT. IN CASE THERE IS ANY VARIATION IN THE TAX SUM DEDUCTIBLE UNDER THE CHAPTER AND / OR THEIR PAYMENT THE ASSESSING OFFICER IS EMPOWERED TO MAKE ADJUSTMENTS IN THIS REGARD AND ALSO REJECT INCORRECT CLAIM MADE BY THE DEDUCTOR WHICH IS APPARENT FROM THE INFORMATION IN THE STATEMENT FILED BY THE DEDUCTOR. FURTHER THE INCOME - TAX AUTHORITY IS AUTHORIZED TO CHARGE INTEREST IF ANY AND THE SAME SHALL BE COMPUTED ON THE BASIS OF SUMS DEDUCTIBLE IN ADDITION TO THE AMOUNT OF TAX DEDUCTED AT SOURCE WHICH IS TO BE PAID TO THE ACCOUNT OF TREASURY B Y THE DEDUCTOR . I N CASE OF ANY DEFAULT INTEREST IS TO BE CHARGED AGAINST SUCH DEDUCTOR AND THE SAME IS TO BE COMPUTED AS PER PROVISIONS OF SECTION 200A(1) (B) OF THE ACT. FURTHER IN ADDITION TO BOTH THESE AMOUNTS CLAUSE (C) TO SECTION 200A OF THE ACT PROVIDES FEES TO BE LEVIED WHICH SHALL BE COMPUTED IN ACCORDANCE WITH THE PROVISIONS OF SECTION 234E OF THE ACT. THE SAID PROVISION TO CHARGE FEES BY THE PRESCRIBED AUTHORITY HAS BEEN SUBSTITUTED FOR EARLIER PROVISIONS BY THE FINANCE ACT 2015 W.E.F. 01.06.2015. PRIOR TO THE SAID SUBSTITUTION THOUGH THE PROVISIONS OF SECTION 234E OF THE ACT FOR PAYMENT OF FEES FOR DEFAULT IN FURNISHING THE STATEMENT W ERE INSERTED BY THE FINANCE ACT 2012 W.E.F. 01.07.2012 THE PRESCRIBED AUTHORITY DID NOT HAVE THE POWER TO CHARGE THE SAID FEES WHILE PROCESSING THE QUARTERLY STATEMENTS / RETURNS UNDER SECTION 200A OF THE ACT . PROCESSING THE QUARTERLY STATEMENTS / RETURNS UNDER SECTION 200A OF THE ACT . 2 4 . NOW LOOKING AT VARIOUS PROVISIONS OF THE ACT THE ISSUE NEEDS TO BE ADJUDICATED IN THE CASE OF ASSESSEE WHEREIN ADMITTEDLY TDS RETURNS WHICH WERE DEEMED TO BE FILED BY THE ASSESSEE WERE FILED AFTER DELAY AND THE QUESTION WAS WHETHER THE ASSESSING OFFICER WHICH PROCESSING THE INTIMATION UNDER SECTION 200A OF THE ACT COULD CHARGE LATE FEE UNDER THE PROVISIONS OF SECTION 234E OF THE ACT. THE ASSESSEE CLAIMS THAT THE ASSESSING OFFICER AT BEST COULD CHARGE THE DIFFERENCE IN TAX DEDUCTED A ND NOT PAID IN TREASURY FROM THE DEDUCTOR AND / OR ANY INTEREST PAYABLE ON SUCH DEDUCTION OF TAX AT SOURCE. HOWEVER TILL SUBSTITUTION OF CLAUSE ( C ) TO SECTION 200A(1) OF THE ACT BY THE FINANCE ACT 2015 W.E.F. 01.06.2015 THE ASSESSING OFFICER WAS NOT EM POWERED TO CHARGE FEES UNDER SECTION 234E OF THE ACT. THE CASE OF REVENUE ON THE OTHER HAND WAS THAT IT WAS THE DUTY OF DEDUCTOR WHILE FURNISHING THE STATEMENT UNDER SECTION 200(3) OF THE ACT TO DEPOSIT THE FEES REFERRED TO IN SECTION 234E(1) OF THE ACT. THE LEARNED CIT - DR STRESSED THAT FEES REFERRED TO IN SUB - SECTION (1) HAD TO BE PAID WHILE DELIVERING OR CAUSING TO DELIVER THE STATEMENT IN ACCORDANCE WITH PROVISIONS OF SECTION 200(3) OF THE ACT OR THE PROVISO TO SECTION 206C(3) OF THE ACT. HOWEVER VA RI OUS REGULATIONS AND THE STATUTORY PROVISIONS IN THIS REGARD POINT OUT THAT UNDOUBTEDLY THE RESPONSIBILITY OF THE DEDUCTOR WAS TO DEPOSIT THE TAX DEDUCTED AT SOURCE IN TIME AND IF NOT SO THEN WITH INTEREST AND CONSEQUENTLY WHERE THE TAX WAS NOT PAID IN TIME AND INTEREST WAS NOT PAID IN TIME AND THEN WHERE THE STATEMENT OF TAX DEDUCTED AT SOURCE COULD NOT BE FILED BEFORE THE PRESCRIBED AUTHORITY WITHIN STIPULATED TIME THE ASSESSEE WAS LIABLE TO LEVY OF FEES UNDER SECTION 234E OF THE ACT . HOWEVER IN CASE ANY DEFAULT OCCURS DUE TO THE NON - PAYMENT OF FEES BY THE ASSESSEE IN THIS REGARD THEN THE PROVISIONS WHICH HAS TO BE CONSIDERED IS SECTION 200A(1)(C) OF THE ACT. THE POWER TO CHARGE / COLLECT FEES AS PER PROVISIONS OF SECTION 234E OF THE ACT WAS VESTED WITH THE PRESCRIBED AUTHORITY UNDER THE ACT ONLY ON SUBSTITUTION OF EARLIER CLAUSE 8 (C) TO SECTION 200A OF THE ACT BY THE FINANCE ACT 2015 W.E.F. 01.06.2015. ONCE ANY PROVISION OF THE ACT HAS BEEN MADE APPLICABLE FROM A RESPECTIVE DATE THEN THE REQUIREMENT OF THE STATUTE IS TO APPLY THE SAID PROVISIONS FROM THE SAID DATE. 25. IN RESPECT OF THE ISSUE RAISED BEFORE US IT IS CLEAR THAT THE PRESCRIBED AUTHORITY HAS BEEN VESTED WITH THE POWER TO CHARGE FEES UNDER SECTION 234E OF THE ACT ONLY WITH REGARD TO LEVY OF FEES BY THE SUBSTITUTION MADE BY FINANCE (NO.2) ACT 2015 W.E.F. 01.06.2015 . ONCE THE POWER HAS BEEN GIVEN UNDER WHICH ANY LEVY HAS TO BE IMPOSED UPON TAX PAYER THEN SUCH POWER COMES INTO EFFECT FROM THE DATE OF SUBSTITUTION AND CANNOT BE APPLIED RETROSPECTIVELY. THE SAID EXERCISE OF POWER HAS BEEN PROVIDED BY THE STATUTE TO BE FROM 01.06.2015 AND HENCE IS TO BE APPLIED PROSPECTIVELY. THERE IS NO MERIT IN THE CLAIM OF REVENUE THAT EVEN WITHOUT INSERTION OF CLAUSE (C) UNDER SECTION 200A(1) OF THE ACT IT WAS INCUMBENT UPON THE ASSESSEE TO PAY FEES IN CASE THERE IS DEFAULT IN FURNISHING THE STATEMENT OF TAX DEDUCTED AT SOURCE. ADMITTEDLY THE ONUS WAS UPON THE ASSESSEE TO PREPARE STATEMENTS AND DELIVER THE SAME WITHIN PRESCRIBED TIME BEFORE THE PRESCRIBED AUTHORITY BUT THE POWER TO COLLECT THE FEES BY THE PRESCRIBED AUTHORIT Y VESTED IN SUCH AUTHORITY ONLY BY WAY OF SUBSTITUTION OF CLAUSE (C) TO SECTION 200A(1) OF THE ACT BY THE FINANCE ACT 2015 W.E.F. 01.06.2015. PRIOR TO SAID SUBSTATION THE ASSESSING OFFICER HAD NO AUTHORITY TO CHARGE THE FEES UNDER SECTION 234E OF THE AC T WHILE ISSUING INTIMATION UNDER SECTION 200A OF THE ACT . BEFORE EXERCISING THE AUTHORITY OF CHARGING ANY SUM FROM ANY DEDUCTOR OR THE ASSESSEE THE PRESCRIBED AUTHORITY SHOULD HAVE NECESSARY POWER VESTED IN IT AND BEFORE VESTING OF SUCH POWER NO ORDER C AN BE PASSED BY THE PRESCRIBED AUTHORITY IN CHARGING OF SUCH FEES UNDER SECTION 234E OF THE ACT WHILE EXERCISING JURISDICTION UNDER SECTION 200A OF THE ACT . THUS IN THE ABSENCE OF ENABLING PROVISIONS UNDER WHICH THE PRESCRIBED AUTHORITY IS EMPOWERED TO CHARGE THE FEES THE ASSESSING OFFICER WHILE PROCESSING THE RETURNS FILED BY THE DEDUCTOR IN RESPECT OF TAX DEDUCTED AT SOURCE CAN RAISE THE DEMAND ON ACCO UNT OF TAXES IF A NY NOT DEPOSITED AND CHARGE INTEREST. HOWEVER PRIOR TO 01.06.2015 THE ASSESSING OFFICER DOES NOT HAVE THE POWER TO CHARGE FEES UNDER SECTION 234E OF THE ACT WHILE PROCESSING TDS RETURNS. IN THE CHARGE FEES UNDER SECTION 234E OF THE ACT WHILE PROCESSING TDS RETURNS. IN THE ABSENCE OF ENABLING PROVISIONS LEVY OF FEES COULD NOT BE EFFECTED IN THE COURSE OF INTIMATION ISSUED UNDER SECTION 200A OF THE ACT PRIOR TO 01.06.2015 . 2 6 . THE AMRITSAR BENCH OF TRIBUNAL IN SIBIA HEALTHCARE (P) LTD. VS. DCIT (2015) 121 DTR 81 (ASR) (TRIB) HAD HELD THAT THE ADJUSTMENT IN RESPECT OF LEVY OF FEES UNDER SECTION 234E OF THE ACT WAS INDEED BEYOND THE SCOPE OF PERMISSIBLE ADJUSTMENTS CONTEMPLATED UNDER SECTION 200A OF THE ACT . S UCH A LEVY COULD NOT BE EFFECTED IN THE COURSE OF INTIMATION UNDER SECTION 200A OF THE ACT AND IN THE ABSENCE OF ANY OTHER PROVISIONS ENABLING THE DEMAND IN RESPECT OF THIS LEVY HAVING BEEN POINTED OUT NO SUCH LEVY COULD BE EFFECTED. THE SAID PROPOSITION HAS BEEN APPLIED IN VARIOUS DECISIONS OF DIFFERENT BENCHES OF TRIBUNAL. REFERENCE WAS MADE TO THE DECISION S OF CHENNAI BENCH OF TRIBUNAL IN G. INDIRANI VS. DCIT (SUPRA) AHMEDABAD BENCH OF TRIBUNAL IN M/S. GLOBE ECOLOGISTICS LTD. VS. DCIT IN ITA NOS.2689 - 2691/AHD/2015 ITA NO.2692/AHD/2015 RELATING TO ASSESSMENT YEAR 2014 - 15 ITA NO.2693/AHD/2015 RELATING TO ASSESSMENT YEAR 2013 - 14 AND ITA NOS.2694 - 2695/AHD/2014 RELATING TO ASSESSMENT YEAR 2013 - 14 VIDE CONSOLIDATED ORDER DATED 26.11.2015 AND CHANDIGARH BENCH OF TRIBUNAL IN M/S. KHANNA WATCHES LTD. VS. DCIT IN ITA NOS.731 TO 735/CHD/2015 RELATING TO ASSESSMENT YEARS 2014 - 15 & 2013 - 14 ORDER DATED 29.10.2015. 2 7 . WHILE DECIDING THE PRESENT BUNCH OF APPEALS THE REVENUE HAD PLACED RELIANCE ON THE RATIO LAID DOWN BY THE HONBLE BOMBAY HIGH COURT IN RASHMIKANT KUNDALIA VS. UNION OF INDIA (SUPRA) WHEREIN THE CONSTITUTIONAL VALIDITY OF SECTION 234E OF THE ACT WAS CHALLENGED. THE HONBLE HIGH COURT NOTED THE FACT THAT WHERE THE DEDUCTOR WAS REQUIRED TO FURNISH PERIODICAL QUARTERLY STATEMENTS CONTAINING THE DETAILS OF DEDUCTION OF TAX MADE DURING THE QUARTER BY THE PRESCRIBED DUE DATE AND THE DELAY IN FURNISHING SUCH TDS RETURNS WOULD HAVE 9 CASCADING EFFECT. IT WAS FURTHER OBSERVED BY THE HONBLE HIGH COURT THAT UNDER THE INCOME - TAX ACT WHERE THERE IS AN OBLIGATION ON THE INCOME - TAX DEPARTMENT TO PROCESS THE INCOME - TAX RETURNS WITHIN SPECIFIED PERIOD FROM THE DATE OF FILING THE RETURNS COULD NOT BE ACCURATELY PROCESSED OF SUCH PERSON ON WHOSE BEHALF TAX HAS BEEN DEDUCTED I.E. DEDUCTEE UNTIL INFORMATION OF SUCH DEDUCTIONS IS FURNISHED BY THE DEDUCTOR WITHIN THE PRESCRIBED TIME. SINCE THE SUBSTANTIAL NUMBER OF DEDUCTORS WERE NOT FILING THEIR TDS RETU RNS / STATEMENTS WITHIN PRESCRIBED TIME FRAME THEN IT LEAD TO AN ADDITIONAL WORK BURDEN UPON THE DEPARTMENT DUE TO THE FAULT OF THE DEDUCTOR AND IN THIS LIGHT AND TO COMPENSATE FOR ADDITIONAL WORK BURDEN FORCED UPON THE DEPARTMENT FEES WAS SOUGHT TO BE L EVIED UNDER SECTION 234E OF THE ACT. THE HONBLE HIGH COURT HELD THAT LOOKING AT THIS FROM THIS PERSPECTIVE SECTION 234E OF THE ACT WAS NOT PUNITIVE IN NATURE BUT A FEE WHICH WAS A FIXED CHARGE FOR THE EXTRA SERVICE WHICH THE DEPARTMENT HAD TO PROVIDE DUE TO THE LATE FILING OF TDS STATEMENTS. IT WAS FURTHER HELD BY THE HONBLE HIGH COURT THAT LATE FILING OF TDS RETURNS / STATEMENTS WAS REGULARIZED BY PAYMENT OF FEES AS SET OUT IN SECTION 234E OF THE ACT. THEREFORE THE FINDINGS OF HONBLE HIGH COURT W ERE THUS THAT THE FEES SOUGHT TO BE LEVIED UNDER SECTION 234E OF THE ACT WAS NOT IN THE GUISE OF TAX SOUGHT TO BE LEVIED ON THE DEDUCTOR. THE PROVISIONS OF SECTION 234E OF THE ACT WERE HELD TO BE NOT ONEROUS ON THE GROUND THAT SECTION DOES NOT EMPOWER TH E ASSESSING OFFICER TO CONDONE THE DELAY IN LATE FILING THE INCOME TAX RETURNS OR THAT NO APPEAL IS PROVIDED FROM ARBITRARY ORDER PASSED UNDER SECTION 234E OF THE ACT. THE HONBLE HIGH COURT HELD THAT THE RIGHT TO APPEAL WAS NOT A MATTER OF RIGHT BUT WAS CREATURE OF STATUTE AND IF THE LEGISLATURE DEEMS FIT NOT TO PROVIDE REMEDY OF APPEAL SO BE IT. THE HONBLE HIGH COURT FURTHER HELD THAT A PERSON CAN ALWAYS APPROACH THE COURT IN EXTRAORDINARY EQUITABLE JURISDICTION UNDER ARTICLE 226/227 OF THE CONSTITUTI ON AS THE CASE MAY BE. THE HONBLE HIGH COURT THEREFORE OBSERVED THAT SIMPLY BECAUSE NO REMEDY OF APPEAL WAS PROVIDED FOR THE PROVISIONS OF SECTION 234E OF THE ACT THE SAME CANNOT BE SAID TO BE ONEROUS AND SECTION 234E OF THE ACT WAS HELD TO BE CONSTITUTIONALLY VALID. THE CONSTITUTIONAL VALIDITY OF PROVISIONS OF SECTION 234E OF THE ACT HAS ALSO BEEN UPHELD BY THE HONBLE RAJASTHAN HIGH COURT IN M/S. DUNDLOD SHIKSHAN UPHELD BY THE HONBLE RAJASTHAN HIGH COURT IN M/S. DUNDLOD SHIKSHAN SANSTHAN & ANR. VS. UNION OF INDIA AND ORS (SUPRA). 2 8 . IN VIEW OF THE ABOVE SAID RATIO LAID DOWN BY THE HONBLE BOMBAY HIGH COURT THE CASE OF THE LEARNED CIT - DR BEFORE US WAS THAT THERE IS NO MERIT IN THE PRESENT SET OF APPEALS FILED BY THE ASSESSEE AS THE HONBLE HIGH COURT HAS L AID DOWN THAT NO APPEAL IS PROVIDED FROM AN ORDER PASSED UNDER SECTION 234E OF THE ACT AND THE SAME MERITS TO BE DISMISSED AT THE OUTSET. IN THIS REGARD HE HAS RAISED TWO ISSUES THAT (A) THE APPEAL FILED BY THE ASSESSEE IS NOT MAINTAINABLE AND ALSO (B) T HERE IS NO MERIT IN THE CLAIM OF THE ASSESSEE THAT THE ASSESSING OFFICER IS NOT EMPOWERED TO CHARGE FEES UNDER SECTION 234E OF THE ACT BEFORE INSERTION OF CLAUSE (C) TO SECTION 200A(1) OF THE ACT BY THE FINANCE ACT 2015 W.E.F. 01.06.2015. THE LEARNED AUT HORIZED REPRESENTATIVE FOR THE ASSESSEE ON THE OTHER HAND DREW OUR ATTENTION TO THE MEMORANDUM TO THE FINANCE BILL 2015 WHILE INTRODUCING THE SAID CLAUSE (C) TO SECTION 200A(1) OF THE ACT. THE FINANCE BILL TOOK NOTE OF THE PROVISIONS OF CHAPTER XVIIB U NDER WHICH THE PERSON DEDUCTING TAX I.E. DEDUCTOR WAS REQUIRED TO FILE QUARTERLY TAX DEDUCTION AT SOURCE STATEMENT CONTAINING THE DETAILS OF DEDUCTION OF TAX MADE DURING THE QUARTER BY THE PRESCRIBED DUE DATES. SIMILAR RESPONSIBILITY IS O N A PERSON REQUIRED TO COLLECT TAX OF CERTAIN SPECIFIED RECEIPTS UNDER SECTION 206C OF THE ACT . IN ORDER TO PROVIDE EFFECTIVE DETERRENCE AGAINST THE DELAY IN FURNISHING TDS / TCS STATEMENTS THE FINANCE ACT 2012 INSERTED SECTION 234E OF THE ACT TO PROVIDE FOR LEVY OF FEES ON LATE FURNISHING OF TDS / TCS STATEMENTS. THE MEMO FURTHER TOOK NOTE OF THE FACT THAT THE FINANCE (NO.2) ACT 2009 INSERTED SECTION 200A IN THE ACT WHICH PROVIDED FOR FURNISHING OF TDS STATEMENTS FOR DETERMINING THE AMOUNT PAYABLE OR REFUNDABLE TO THE DEDUCTOR. IT FURTHER TOOK NOTE THAT HOWEVER AS SECTION 234E OF THE ACT WAS INSERTED AFTER THE INSERTION OF SECTION 200A IN THE ACT THE EXISTING PROVISIONS OF SECTION 200A OF THE ACT DOES NOT PROVIDE FOR DETERMINATION OF FEES PAYABLE UN DER SECTION 234E OF THE ACT AT THE TIME OF 10 PROCESSING OF TDS STATEMENTS. IT WAS THUS PROPOSED TO AMEND THE PROVISIONS OF SECTION 200A OF THE ACT SO AS TO ENABLE THE COMPUTATION OF FEES PAYABLE UNDER SECTION 234E OF THE ACT AT THE TIME OF PROCESSING OF TD S STATEMENTS UNDER SECTION 200A OF THE ACT. THE MEMO EXPLAINING THE FINANCE BILL 2015 VERY CATEGORICALLY HELD THAT CURRENTLY THERE DOES NOT EXIST ANY PROVISION IN THE ACT TO ENABLE THE PROCESSING OF TCS RETURNS AND HENCE A PROPOSAL WAS MADE TO INSERT A PROVISION IN THIS REGARD AND ALSO THE POST PROVISION SHALL INCORPORATE THE MECHANISM FOR COMPUTATION OF FEES PAYABLE UNDER SECTION 234E OF THE ACT. THE FINANCE BILL FURTHER REFERS TO THE EXISTING PROVISIONS OF THE ACT I.E. AFTER PROCESSING OF TDS STATEMEN T INTIMATION IS GENERATED SPECIFYING THE AMOUNT PAYABLE OR REFUNDABLE. THIS INTIMATION GENERATED AFTER PROCESSING OF TDS STATEMENT IS (I) SUBJECT TO RECTIFICATION UNDER SECTION 154 OF THE ACT; (II) APPEALABLE UNDER SECTION 246A OF THE ACT; AND (III) DEEMED AS NOTICE OF PAYMENT UNDER SECTION 156 OF THE ACT. THE FINANCE BILL FURTHER PROVIDED THAT INTIMATION GENERATED AFTER THE PROPOSED PROCESSING OF TCS STATEMENT SHALL BE AT PAR WITH THE INTIMATION GENERATED AFTER PROCESSING OF TDS STATEMENT AND ALSO P ROVIDED THAT FAILURE TO PAY TAX SPECIFIED IN THE INTIMATION SHALL ATTRACT LEVY OF INTEREST AS PER PROVISIONS OF SECTION 220(2) OF THE ACT. FURTHER AMENDMENTS WERE ALSO MADE IN RESPECT OF THE SCHEME OF PAYMENT OF TDS / TCS BY THE GOVERNMENT DEDUCTOR / CO LLECTOR WHICH ARE NOT RELEVANT FOR DECIDING THE ISSUE IN THE PRESENT APPEAL AND HENCE THE SAME ARE NOT BEING REFERRED TO. THE FINANCE BILL FURTHER PROVIDED THAT THE AMENDMENT WOULD TAKE EFFECT FROM 01.06.2015. 29. THE PERUSAL OF MEMO EXPLAINING THE PROVISION RELATING TO INSERTION OF CLAUSE (C) TO SECTION 200A OF THE ACT CLARIFIES THE INTENTION OF LEGISLATURE IN INSERTING THE SAID PROVISION. THE PROVISIONS OF SECTION 234E OF THE ACT WERE INSERTED BY THE FINANCE ACT 2012 UNDER WHICH THE PROVISION WAS MADE FOR LEVY OF FEES FOR LATE FURNISHING TDS / TCS STATEMENTS. BEFORE INSERTION OF SECTION 234E OF THE ACT THE FINANCE (NO.2) ACT 2009 HAD INSERTED SECTION 200A IN THE ACT UNDER THE SAID SECTION MECHANISM WAS PROV IDED FOR PROCESSING OF TDS STATEMENTS FOR DETERMINING THE AMOUNT PAYABLE OR REFUNDABLE TO THE DEDUCTOR UNDER WHICH THE PROVISION WAS ALSO MADE FOR CHARGING OF INTEREST. HOWEVER UNDER WHICH THE PROVISION WAS ALSO MADE FOR CHARGING OF INTEREST. HOWEVER SINCE THE PROVISIONS OF SECTION 234E OF THE ACT WERE NOT ON STATUTE WHEN THE FINANCE (NO.2) ACT 2009 WAS PASSED NO PROVISION WAS MADE FOR DETERMINING THE FEES PAYABLE UNDER SECTION 234E OF THE ACT AT THE TIME OF PROCESSING THE TDS STATEMENTS. SO WHEN SECTION 234E OF THE ACT WAS INTRODUCED IT PROVIDED THAT THE PERSON WAS RESPO NSIBLE FOR FURNISHING THE TDS RETURNS / STATEMENTS WITHIN STIPULATED PERIOD AND IN DEFAULT FEE S WOULD BE CHARGED ON SUCH PERSON. THE SAID SECTION ITSELF PROVIDED THAT FEES SHALL NOT EXCEED THE AMOUNT OF TAX DEDUCTED AT SOURCE OR COLLECTED AT SOURCE. IT WAS FURTHER PROVIDED THAT THE PERSON RESPONSIBLE FOR FURNISHING THE STATEMENTS SHALL PAY THE SAID AMOUNT WHILE FURNISHING THE STATEMENTS UNDER SECTION 200(3) OF THE ACT. HOWEVER POWER ENABLING THE ASSESSING OFFICER TO CHARGE / LEVY THE FEE UNDER SECTION 234E OF THE ACT WHILE PROCESSING THE TDS RETURNS / STATEMENTS FILED BY A PERSON DID NOT EXIST WHEN SECTION 234E OF THE ACT WAS INSERTED BY THE FINANCE ACT 2012. THE POWER TO CHARGE FEES UNDER THE PROVISIONS OF SECTION 234E OF THE ACT WHILE PROCESSING THE TDS STATEMENTS WAS DWELLED UPON BY THE LEGISLATURE BY WAY OF INSERTION OF CLAUSE (C) TO SECTION 200A(1) OF THE ACT BY THE FINANCE ACT 2015 W.E.F. 01.06.2015. ACCORDINGLY WE HOLD THAT WHERE THE ASSESSING OFFICER HAS PROCESSED THE TDS STATEMENTS FILED B Y THE DEDUCTOR WHICH ADMITTEDLY WERE FILED BELATEDLY BUT BEFORE INSERTION OF CLAUSE (C) TO SECTION 200A(1) OF THE ACT W.E.F. 01.06.2015 THEN IN SUCH CASES THE ASSESSING OFFICER IS NOT EMPOWERED TO CHARGE FEES UNDER SECTION 234E OF THE ACT WHILE PROCESS ING THE TDS RETURNS FILED BY THE DEDUCTOR. 30 . THE HONBLE BOMBAY HIGH COURT IN RASHMIKANT KUNDALIA VS. UNION OF INDIA (SUPRA) HAS UPHELD THE CONSTITUTIONAL VALIDITY OF SAID SECTION INTRODUCED BY THE FINANCE ACT 2015 W.E .F. 01.06.2015 BUT WAS NOT ABR EAST OF THE APPLICABILITY OF THE SAID SECTION 234E OF THE ACT BY THE ASSESSING OFFICER WHILE PROCESSING TDS STATEMENT FILED BY THE DEDUCTOR PRIOR TO 01.06.2015. IN SUCH SCENARIO WE 11 FIND NO MERIT IN THE PLEA OF LEARNED CIT - DR THAT THE HONBLE BOMBAY HIGH COURT IN RASHMIKANT KUNDALIA VS. UNION OF INDIA (SUPRA) HAS LAID DOWN THE PROPOSITION THAT FEES UNDER SECTION 234E OF THE ACT IS CHARGEABLE IN THE CASE OF PRESENT SET OF APPEALS WHERE THE ASSESSING OFFICER HAD ISSUED THE INTIMATION UNDER SECTION 200A OF THE ACT PRIOR TO 01.06.2015. 3 1 . ANOTHER ASPECT OF THE ISSUE IS WHETHER THE AMENDMENT BROUGHT IN BY THE FINANCE ACT 2015 W.E.F. 01.06.2015 BY WAY OF INSERTION OF CLAUSE (C) TO SECTION 200A(1) OF THE ACT IS CLARIFICATORY OR IS PROSPECTIVE IN NATURE AND IS NOT APPLICABLE TO THE PENDING ASSESSMENTS. UNDOUBTEDL Y THE PROVISIONS OF SECTION 234E OF THE ACT WERE IN SERTED BY THE FINANCE ACT 2012 UNDER WHICH THE LIABILITY WAS IMPOSED UPON THE DEDUCTOR IN SUCH CASES WHERE TDS STATEMENTS / RETURNS WERE FILED BELATEDLY TO PAY THE FEES AS PER SAID SECTION. HOWEVER IN CASES WHERE THE ASSESSEE HAS FAILED TO DEPOSIT THE SAID FEES THEN IN ORDER TO ENABLE THE ASSESSING OFFICER TO COLLECT THE SAID FEES CHARGEABLE UNDER SECTION 234E OF THE ACT IT IS INCUMBENT UPON THE LEGISLATURE TO PROVIDE MECHANISM FOR THE ASSESSING OFF ICER TO CHARGE AND COLLECT SUCH FEES. IN THE ABSENCE OF ENABLING PROVISIONS THE ASSESSING OFFICER WHILE PROCESSING THE TDS STATEMENTS EVEN IF THE SAID STATEMENTS ARE BELATED IS NOT EMPOWERED TO CHARGE THE FEES UNDER SECTION 234E OF THE ACT. THE AMENDM ENT WAS BROUGHT IN BY THE FINANCE ACT 2015 W.E.F. 01.06.2015 AND SUCH AN AMENDMENT WHERE EMPOWERMENT IS GIVEN TO THE ASSESSING OFFICER TO LEVY OR CHARGE THE FEES CANNOT BE SAID TO BE CLARIFICATORY IN NATURE AND HENCE APPLICABLE FOR PENDING ASSESSMENTS. 3 2 . THE HONBLE SUPREME COURT IN CIT VS. VATIKA TOWNSHIP PVT. LTD. (SUPRA) HAS EXPLAINED THE GENERAL PRINCIPLE CONCERNING RETROSPECTIVITY AND HAVE HELD THAT OF THE VARIOUS RULES GUIDING HOW A LEGISLATION HAS TO BE INTERPRETED ONE ESTABLISHED RULE IS TH AT UNLESS CONTRARY INTENTION APPEARS A LEGISLATION IS PRESUMED NOT TO BE INTENDED TO HAVE A RETROSPECTIVE OPERATION. IDEA BEHIND THE RULE IS THAT CURRENT LAW SHOULD GOVERN CURRENT ACTIVITIES. THE MEMO EXPLAIN ING THE FINAN CE BILL 2015 VERY CLEARLY ALSO RECOGNIZES THAT AND REFER S TO THE CURRENT PROVISIONS OF SUB - SECTION (3) TO SECTION 200 OF THE ACT UNDER WHICH THE DEDUCTOR IS TO FURNISH TDS STATEMENTS. HOWEVER AS SECTION 234E OF THE ACT WAS INSERTED IS TO FURNISH TDS STATEMENTS. HOWEVER AS SECTION 234E OF THE ACT WAS INSERTED AFTER INSERTION OF SECTION 200A IN THE ACT THE EXISTING PROVISIONS OF SECTION 200A OF THE ACT DID NOT PROVIDE FOR DETERMINATION OF FEES PAYABLE UNDER SECTION 234E OF THE ACT AT THE TIME OF PROCESSING OF TDS STATEMENTS. IN THIS REGARD IT WAS THUS PROPOSED TO AMEND THE PROVISIONS OF SECTION 200A OF THE ACT SO AS TO ENABLE THE COMP UTATION OF FEES PAYABLE UNDER SECTION 234E OF THE ACT AT THE TIME OF PROCESSING OF TDS STATEMENTS UNDER SECTION 200A OF THE ACT. IN OTHER WORDS THE ASSESSING OFFICER IS EMPOWERED TO CHARGE FEES PAYABLE UNDER SECTION 234E OF THE ACT IN THE INTIMATION ISSU ED AFTER INSERTION OF CLAUSE (C) TO SECTION 200A(1) OF THE ACT W.E.F. 01.06.2015. THE LEGISLATURE ITSELF RECOGNIZED THAT UNDER THE EXISTING PROVISIONS OF SECTION 200A OF THE ACT I.E. PRIOR TO 01.06.2015 THE ASSESSING OFFICER AT THE TIME OF PROCESSING THE TDS STATEMENTS DID NOT HAVE POWER TO CHARGE FEES UNDER SECTION 234E OF THE ACT AND IN ORDER TO COVER UP THAT THE AMENDMENT WAS MADE BY WAY OF INSERTION OF CLAUSE (C) TO SECTION 200A OF THE ACT. IN SUCH SCENARIO IT CANNOT BE SAID THAT INSERTION MADE BY SECTION 200A(1)(C) OF THE ACT IS RETROSPECTIVE IN NATURE W HERE THE LEGISLATURE WAS AWARE THAT THE FEES COULD BE CHARGED UNDER SECTION 234E OF THE ACT AS PER FINANCE ACT 2012 AND ALSO THE PROVISIONS OF SECTION 200A OF THE ACT WERE INSERTED BY FINANCE (NO. 2) ACT 2009 UNDER WHICH THE MACHINERY WAS PROVIDED FOR THE ASSESSING OFFICER TO PROCESS THE TDS STATEMENTS FILED BY THE ASSESSEE . T HE INSERTION CATEGORICALLY BEING MADE W.E.F. 01.06.2015 LAYS DOWN THAT THE SAID AMENDMENT IS PROSPECTIVE IN NATURE AND CANNOT BE APPLIED TO PROCESSING OF TDS RETURNS / STATEMENTS PRIOR TO 01.06.2015 . 33. WE FURTHER FIND THAT IN RECENT JUDGMENT DATED 26.08.2016 THE HONBLE KARNATAKA HIGH COURT IN WRIT APPEAL NOS.2663 - 2674/2015(T - IT) & ORS IN SRI FATHERAJ SINGHVI & ORS V S. UNION OF INDIA & ORS HAS QUASHED THE INTIMATION ISSUED UNDER SECTION 200A OF THE ACT LEVYING THE FEES FOR DELAYED FILING THE TDS STATEMENTS UNDER SECTION 234E OF THE ACT. THE HONBLE HIGH COURT NOTES THAT 12 THE FINANCE ACT 2015 HAD MADE AMENDMENTS TO SE CTION 200A OF THE ACT ENABLING THE ASSESSING OFFICER TO MAKE ADJUSTMENTS WHILE LEVYING FEES UNDER SECTION 234E OF THE ACT WAS APPLICABLE W.E.F. 01.06.2015 AND HAS HELD THAT IT HAS PROSPECTIVE EFFECT. ACCORDINGLY THE HONBLE HIGH COURT HELD THAT INTIMATI ON RAISING DEMAND PRIOR TO 01.06.2015 UNDER SECTION 200A OF THE ACT LEVYING SECTION 234E OF THE ACT LATE FEES IS NOT VALID. HOWEVER THE HONBLE HIGH COURT KEPT OPEN THE ISSUE ON CONSTITUTIONAL VALIDITY OF SECTION 234E OF THE ACT. WE HAVE ALREADY REFERR ED TO THE DECISION OF HONBLE BOMBAY HIGH COURT IN RASHMIKANT KUNDALIA VS. UNION OF INDIA (SUPRA) IN THIS REGARD WHEREIN THE CONSTITUTIONAL VALIDITY OF SECTION 234E OF THE ACT HAS BEEN UPHELD. 34. ACCORDINGLY WE HOLD THAT THE AMENDMENT TO SECTION 200A(1) OF THE ACT IS PROCEDURAL IN NATURE AND IN VIEW THEREOF THE ASSESSING OFFICER WHILE PROCESSING THE TDS STATEMENTS / RETURNS IN THE PRESENT SET OF APPEALS FOR THE PERIOD PRIOR TO 01.06.2015 WAS NOT EMPOWERED TO CHARGE FEES UNDER SECTION 234E OF THE ACT. HENCE THE INTIMATION ISSUED BY THE ASSESSING OFFICER UNDER SECTION 200A OF THE ACT IN ALL THESE APPEALS DOES NOT STAND AND THE DEMAND RAISED BY WAY OF CHARGING THE FEES UNDER SECTION 234E OF THE ACT IS NOT VALID AND THE SAME IS DELETED. THE INTIMA TION ISSUED BY THE ASSESSING OFFICER WAS BEYOND THE SCOPE OF ADJUSTMENT PROVIDED UNDER SECTION 200A OF THE ACT AND SUCH ADJUSTMENT COULD NOT STAND IN THE EYE OF LAW . 35. BEFORE PARTING WE MAY REFER TO RELIANCE PLACED UPON BY T HE LEARNED CIT - DR ON THE RATIO LAID DOWN BY CHENNAI BENCH OF TRIBUNAL IN G. INDIRANI VS. DCIT (SUPRA) ON ANOTHER ASPECT WHEREIN IT WAS HELD THAT BEFORE 01.06.2015 WHETHER THE ASSESSING OFFICER HAD AUTHORITY TO PASS A SEPARATE ORDER UNDER SECTION 234E OF THE ACT LEVYING FEES FOR DELAY IN FILING THE TDS STATEMENTS UNDER SECTION 200(3) OF THE ACT ; THE TRIBUNAL HELD YES THAT THE ASSESSING AUTHORITY HAD SUCH POWER AND AFTER 01.06.2015 THE ASSESSING OFFICER WAS WITHIN HIS LIMIT TO LEVY FEES UNDER SECTION 234 E OF THE ACT EVEN WHILE PROCESSING THE TDS STATEMENTS UNDER SECTION 200A OF THE ACT. IN VIEW OF THE PRESENT SET OF FACTS WHERE THE ASSESSING OFFICER HAD CHARGED FEES UNDER SECTION 234E OF THE ACT WHILE PROCESSING THE STATEMENTS UNDER SECTION 200A OF THE ACT BEFORE 01.06.2015 PROCESSING THE STATEMENTS UNDER SECTION 200A OF THE ACT BEFORE 01.06.2015 THERE IS NO MERIT IN THE RELIANCE PLACED UPON BY THE LEARNED CIT - DR ON THE SAID PROPOSITION LAID DOWN BY THE CHENNAI BENCH OF TRIBUNAL AND WE DISMISS THE SAME. 3 6 . ANOTHER RELIANCE PLACED UPON BY THE LEARNED CIT - DR WAS IN RESPECT OF AMENDMENT BEING RETROSPECTIVE OR PROSPECTIVE AND RELIANCE WAS PLACED ON THE RATIO LAID DOWN BY HONBLE DELHI HIGH COURT IN CIT VS. NARESH KUMAR (SUPRA). HOWEVER IN VIEW OF OUR DECISION IN THE PARAS HEREINABOVE WHERE POWER IS BEING ENSHRINED UPON THE AS SESSING OFFICER TO LEVY OR CHARGE WHILE PROCESSING THE TDS RETURNS W.E.F. 01.06.2015 SUCH PROVISION CANNOT HAVE RETROSPECTIVE EFFECT AS IT WOULD BE DETRIMENTAL TO THE CASE OF TAX PAYER. THE HONBLE DELHI HIGH COURT WAS CONSIDERING THE APPLICATION OF AMEN DMENT TO SECTION 40(A)(IA) OF THE ACT BY THE FINANCE ACT 2010 UNDER WHICH CERTAIN RELAXATIONS WERE GIVEN TO THE APPLICATION OF SAID SECTION AND IT WAS HELD THAT THE SAME APPLIES RETROSPECTIVELY TO EARLIER YEARS. HOWEVER IN THE PRESENT SET OF APPEALS THE ISSUE IS AGAINST THE PROVISION UNDER WHICH A NEW ENABLING POWER IS BEING GIVEN TO CHARGE FEES UNDER SECTION 234E OF THE ACT WHILE PROCESSING TDS RETURNS / STATEMENTS AND SUCH POWER IS TO BE APPLIED PROSPECTIVELY. IN ANY CASE THE PARLIAMENT ITSELF HAS RECOGNIZED ITS OPERATION TO BE PROSPECTIVE IN NATURE WHILE INTRODUCING CLAUSE (C) TO SECTION 200A(1) OF THE ACT AND HENCE CANNOT BE APPLIED RETROSPECTIVELY. SIMILARLY RELIANCE PLACED UPON BY THE LEARNED CIT - DR ON THE RATIO LAID DOWN BY THE HONBLE SUPREME COURT IN GOVINDDAS VS. ITO (SUPRA) IS MISPLACED BECAUSE OF THE DISTINGUISHABLE FACTS AND ISSUES. 13 10. THE ISSUE ARISING IN THE PRESENT APPEALS IS IDENTICAL TO THE ISSUE BEFORE THE TRIBUNAL IN BUNCH OF APPEALS AND WHERE THE AMENDMENT TO SECTION 200A(1) OF THE ACT IS PROCEDURAL IN NATURE THEN THE ASSESSING OFFICER WHILE PROCESSING THE TDS STATEMENTS / RETURNS IN THE PRESENT SET OF APPEALS FOR THE PERIOD PRIOR TO 01.06.2015 WAS NOT EMPOWERED TO CHARGE FEES UNDER SE CTION 234E OF THE ACT. ACCORDINGLY INTIMATION ISSUED BY THE ASSESSING OFFICER UNDER SECTION 200 A OF THE ACT IN ALL THE APPEALS DOES NOT STAND AND THE DEMAND RAISED BY CHARGING THE FEES UNDER SECTION 234E OF THE ACT IS NOT VALID AND THE SAME IS DELETED. THE GROUNDS OF APPEAL RAISED BY THE ASSESSEE ARE THUS ALLOWED. 11 . IN THE RESULT ALL THE APPEALS OF ASSESSEE ARE ALLOWED . ORDER PRO NOUNCED ON THIS 30 TH DAY OF SEPTEMBER 2016 SD/ - SD/ - ( ANIL CHATURVEDI ) ( SUSHMA CHOWLA ) ( ANIL CHATURVEDI ) ( SUSHMA CHOWLA ) / ACCOUNTANT MEMBER / JUDICIAL MEMBER / PUNE ; DATED : 30 TH SEPTEMBER 201 6 . GCVSR / COPY OF THE ORDER IS FORWARDED TO : 1. / THE APPELLANT ; 2. / THE RESPONDENT ; 3. ( ) / THE CIT(A) - II NASHIK ; 4. / THE CIT TDS PUNE ; 5. / DR B ITAT PUNE ; 6. / GUARD FILE . / BY ORDER //TRUE COPY// / SR. PRIVATE SECRETARY / ITAT PUNE