The Income Tax Appellate Tribunal (ITAT) held that the Amendment dated June 01, 2015, in the processing of statement of tax deducted at source under Section 200 A of the Income Tax Act, 1961 is prospective in nature and cannot be applied retrospectively to previous TDS instances.
The appellant was required to file the statement of tax deducted at source for the respective quarter but failed to do so within the due date prescribed in the law for filing such quarterly TDS returns. As per the provisions of section 234E of the Act, the fee for default in furnishing the statement is leviable if the statement of TDS is not delivered within the time prescribed in sub-section (3) of section 200 or the proviso to sub-section (3) of section 206C of the Act.
The revenue authorities have levied the late fees for default in furnishing the statement in the processing of statement of tax deducted at source prepared under section 200A of the Act.
Against the levy of late fee under section 234E in the statement processed under section 200A of the Act, the appeal was preferred by the assessees for respective quarters for the respective assessment years before CIT(A) pleading that before the amendment was brought in by the Finance Act, 2015 with effect from June 01, 2015, the revenue authorities were not having the power to levy the late fees under section 234E of the Act in the statement processed under section 200A of the Act. However, the assessee failed to succeed in all these 10 appeals before CIT(A).
The common issue raised in all these bunches of appeals is that whether the CIT(A) was justified in confirming the levy of late fee under section 234E of the Act in the statement of tax deducted at source processed under section 200A of the Act, even when the amendment brought in the Finance Act 2015 with effect from June 01, 2015, paved the way for levying the fee under section 234E of the Act in the statement processed under section 200A of the Act.
The tribunal consisting of the Judicial Member, Kul Bharat, and an Accountant Member, Manish Board held that the Department was not justified in retrospectively levying the late fees under section 234E of the Act while processing the statement of tax deducted at source under section 200A of the Act on the basis of amendment dated June 01, 2015, in respect of matters falling before the date of the amendment. And clearly settled the position that the amendment brought to the Section 200 A of the Act is prospective in nature and cannot be applied to previous TDS instances.
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