Late Fee can’t be levied while processing TDS Statement: ITAT [Read Order]

The Income Tax Appellate Tribunal (ITAT), Cuttack bench has held that the late fee under Section 234E of the Income Tax Act cannot be levied while processing the TDS Statement as it was beyond the scope provided under Section 200A of the Income Tax Act.

In the instant case, the assessee failed to file TDS statement and during the processing of TDS return within the prescribed time. The AO(TDS) raised demand by way of intimations issued under section 200A of the Act for levy of fees under section 234E for delayed filing of TDS statement.

On second appeal, the Tribunal noted that the issue is covered by the above orders of the Tribunal as the amendment to Section 200(3) of the Income Tax Act was made only with effect from June 1, 2015.

Relying on the above decision, the bench held that “Except for the Quarter-1 in the assessment year 2016-2017(i.e.ITA No.332/CTK/2018), all the quarters i.e. Quarter 4 in the A.Y.2013-2014, for Quarters 1 to 4 in the assessment year 2014-2015 and for Quarters 1 to 4 in the assessment year 2015-2016 are coming under the purview of amendment to Section 200(3) of the Act. Therefore, the fee levied u/s.234E of the Act while processing the statement of tax deducted at source was beyond the scope provided under Section 200A of the Act. Accordingly, we respectfully follow the judicial precedent and set aside the orders of lower authorities and delete the levy of fee u/s.234E of the Act in Quarter 4 in the A.Y.2013-2014, for Quarters 1 to 4 in the assessment year 2014-2015 and for Quarters 1 to 4 in the assessment year 2015- 2016 and allow the appeals i.e ITA Nos.323 to 331/CTK/2018 filed by the assessee.”