Income Tax Appellate Tribunal - Ahmedabad
Anthem Gxp Solutions Private Limited,, ... vs Dcit, Cpc-Tds,, Ghaziabad, on 8 June, 2018
ITA Nos. 869 to 890/Ahd/2018
Anthem GXP Solutions Pvt Ltd Vs. DCIT
Assessment Year : 2013-14, 2014-15 & 2015-16
Page 1 of 5
IN THE INCOME TAX APPELLATE TRIBUNAL
AHMEDABAD "D" BENCH, AHMEDABAD
[Coram: Pramod Kumar, AM and Ms. Madhumita Roy, JM]
ITA No. 869 to 890/Ahd/2018
Assessment Year: 2013-14, 2014-15 & 2015-16
Anthem GXP Solutions Private Limited ..............................Appellant
A-502, Hari Villa Appt., Nr. Sarthi Restaurant,
Vastrapur, Ahmedabad - 380 015
[PAN : AAICA 1720 G]
Vs.
DCIT, CPC-TDS ...........................Respondent
Ghaziabad
Appearances by:
None for the Applicant
VK Singh for the Respondent
Date of concluding the hearing : 08.06.2018
Date of pronouncing the order : 08.06.2018
O R D E R
Per Pramod Kumar, AM:
1. All these 22 appeals are directed against a common order dated 9th February, 2018 passed by the CIT(A) in respect of various quarters for the assessment years 2013-14, 2014-15 and 2015-16, upholding the levy of fees under section 234E of the Income-tax Act on account of delay in furnishing the statement of tax deduction at source. We will take up all these appeals together.
2. The common grievances in all these appeals are as follows:-
"1.1 The order passed u/s 250 on 09-02-2018 for F.Y.2012-13 to 2014-15 relevant A.Y. 2013-14 to 2015-16 by Ld.CIT(A)-8, Ahmedabad upholding the validity of order u/s 200A and levy of fees of Rs.xxxxx/- u/s 234E of the Act is wholly illegal, unlawful and against the principles of natural justice.
1.2 The Ld. CIT(A) has grievously erred in law and or on facts in not considering fully and properly the submissions and evidences produced by the appellant with regard to the impugned fees of Rs.xxxxx/- levied u/s 234E. 2.1 The Ld. CIT(A) has grievously erred in law and on facts in confirming that levy of fees of Rs.xxxxx/- u/s 234E for A.Y. 2013-14 to 2015-16 was valid and lawful.
ITA Nos. 869 to 890/Ahd/2018 Anthem GXP Solutions Pvt Ltd Vs. DCIT Assessment Year : 2013-14, 2014-15 & 2015-16 Page 2 of 5 2.2 That in the facts and circumstances of the case as well as in law, the Ld. CIT(A) has failed to appreciate that the provisions of section 234E did not provide for levy of fees prior to 01-06-2015.
3.1 The Ld. CIT(A) has erred in law and on facts in upholding that (i) section 234E was an enabling provision for computation of fees while processing the statement u/s 200A (ii) the fees so levied is not the nature of penalty but "fees" (iii) the amended provisions of section 234E were applicable from 01- 07-2012 and not 01-06-2015."
3. None appeared for the assessee; but, we have heard the learned Departmental Representative, perused the material on record and duly considered the facts of the case in the light of applicable legal position.
4. As learned Departmental Representative rightly points out, there is no dispute that the issue in appeal is covered against the assessee by Hon'ble jurisdictional High Court's judgment in the case of Rajesh Kourani vs. Union of India, reported in [2017] 83 taxmann.com 137 (Gujarat), wherein Their Lordships have, inter alia, observed as follows:-
"16. We now come to the petitioner's central challenge viz. of non permissibility to levy fee under section 234E of the Act till section 200A of the Act was amended with effect from 01.06.2015. We have noticed the relevant statutory provisions. The picture that emerges is that prior to 01.07.2012, the Act contained a single provision in section 272A providing for penalty in case of default in filing the statements in terms of section 200 or proviso to section 206C. Such penalty was prescribed at the rate of Rs.100 for every day during which the failure continued. With effect from 01.06.2012, three major changes were introduced in the Act. Section 234E as introduced for the first time to provide for charging of fee for late filing of the statements. Such fee would be levied at the rate of Rs.200/- for every day of failure subject to the maximum amount of tax deductible or collectible as the case may be. Section 271H was also introduced for the first time for levying penalty for failure to furnish the statements. Such penalty would be in the range of Rs.10,000/- and Rs.1 lakh. No penalty would be imposed if the tax is deposited with fee and interest and the statement is filed within one year of the due date. With addition to these two provisions prescribing fee and penalty respectively, clause (k) of sub- section (2) of section 272A became redundant and by adding a proviso to the said section, this effect was therefore limited upto 01.07.2012.
17. In essence, section 234E thus prescribed for the first time charging of a fee for every day of default in filing of statement under sub-section (3) of section 200 or any proviso to sub-section (3) of section 206C. This provision was apparently added for making the compliance of deduction and collection of tax at source, depositing it with Government revenue and filing of the statements more stringent.
ITA Nos. 869 to 890/Ahd/2018 Anthem GXP Solutions Pvt Ltd Vs. DCIT Assessment Year : 2013-14, 2014-15 & 2015-16 Page 3 of 5
18. In this context, we may notice that section 200A which pertains to processing of statements of tax deducted at source provides for the procedure once a statement of deduction of tax at source is filed by the person responsible to do so and authorizes the Assessing Officer to make certain adjustments which are prima-facie or arithmetical in nature. The officer would then send an intimation of a statement to the assessee. Prior to 01.06.2015, this provision did not include any reference to the fee payable under section 234E of the Act. By recasting sub-section (1), the new clause-c permits the authority to compute the fee, if any, payable by the assessee under section 234E of the Act and by virtue of clause-d, adjust the said sum against the amount paid under the various provisions of the Act.
19. In plain terms, section 200A of the Act is a machinery provision providing mechanism for processing a statement of deduction of tax at source and for making adjustments, which are, as noted earlier, arithmetical or prima-facie in nature. With effect from 01.06.2015, this provision specifically provides for computing the fee payable under section 234E of the Act. On the other hand, section 234E is a charging provision creating a charge for levying fee for certain defaults in filing the statements. Under no circumstances a machinery provision can override or overrule a charging provision. We are unable to see that section 200A of the Act creates any charge in any manner. It only provides a mechanism for processing a statement for tax deduction and the method in which the same would be done. When section 234E has already created a charge for levying fee that would thereafter not been necessary to have yet another provision creating the same charge. Viewing section 200A as creating a new charge would bring about a dichotomy. In plain terms, the provision in our understanding is a machinery provision and at best provides for a mechanism for processing and computing besides other, fee payable under section 234E for late filing of the statements.
20. Even in absence of section 200A of the Act with introduction of section 234E, it was always open for the Revenue to demand and collect the fee for late filing of the statements. Section 200A would merely regulate the manner in which the computation of such fee would be made and demand raised. In other words, we cannot subscribe to the view that without a regulatory provision being found for section 200A for computation of fee, the fee prescribed under section 234E cannot be levied. Any such view would amount to a charging section yielding to the machinery provision. If at all, the recasted clause (c) of sub-section (1) of section 200A would be in nature of clarificatory amendment. Even in absence of such provision, as noted, it was always open for the Revenue to charge the fee in terms of section 234E of the Act. By amendment, this adjustment was brought within the fold of section 200A of the Act. This would have one direct effect. An order passed under section 200A of the Act is rectifiable under section 154 of the Act and is also appealable under section 246A. In absence of the power of authority to make such adjustment under section 200A of the Act, any calculation of the fee would not partake the character of the intimation under said provision and it could be argued that such an order would not be open to any rectification or appeal. Upon introduction of the recasted clause (c), this situation also would ITA Nos. 869 to 890/Ahd/2018 Anthem GXP Solutions Pvt Ltd Vs. DCIT Assessment Year : 2013-14, 2014-15 & 2015-16 Page 4 of 5 be obviated. Even prior to 01.06.2015, it was always open for the Revenue to calculate fee in terms of section 234E of the Act. The Karnataka High Court in case of Fatheraj Singhvi (supra) held that section 200A was not merely a regulatory provision, but was conferring substantive power on the authority. The Court was also of the opinion that section 234E of the Act was in the nature of privilege to the defaulter if he fails to pay fees then he would be rid of rigor of the penal provision of section 271H of the Act. With both these propositions, with respect, we are unable to concur. Section 200A is not a source of substantive power. Substantive power to levy fee can be traced to section 234E of the Act. Further the fee under section 234E of the Act is not in lieu of the penalty of section 271H of the Act. Both are independent levies. Section 271H only provides that such penalty would not be levy if certain conditions are fulfilled. One of the conditions is that the tax with fee and interest is paid. The additional condition being that the statement is filed latest within one year from the due date.
21. Counsel for the petitioner however, referred to the decision of Supreme Court in case of CIT v. B.C. Srinivasa Setty [1981] 128 ITR 294/5 Taxman 1 (SC), to contend that when a machinery provision is not provided, the levy itself would fail. The decision of Supreme Court in case of B C Srinivasa Setty (supra) was rendered in entirely different background. Issue involved was of charging capital gain on transfer of a capital asset. In case on hand, the asset was in the nature of goodwill. The Supreme Court referring to various provisions concerning charging and computing capital gain observed that none of these provisions suggest that they include an asset in the acquisition of which no cost can be conceived. In such a case, the asset is sold and the consideration is brought to tax, what is charged is a capital value of the asset and not any profit or gain. This decision therefore would not apply in the present case."
5. As a matter of fact, in the statement of facts filed by the assessee, it has been clearly stated that the assessee on its own also accepts the fact that the matter is covered against the assessee by Hon'ble jurisdictional High Court's judgment and that the limited prayer of the assessee is to keep the matter pending till "Hon'ble Gujarat High Court judgment (supra) is reversed either by larger bench or the Supreme Court." This is clear from the following statement made by the assessee in the statement of facts, which reads as under:-
"5. The appellant has also contended that the levy of late filing fees is without any power u/s 200A and late filing fees u/s 234E should not be levied in view of the Karnataka High Court judgment in the case of Fatheraj Singhvi v/s Union of India [2016] 73 taxmann.com 252. However, in view of Gujarat High Court's judgment, the levy of late filing fees u/s 234E is tenable in law and provisions of section 200A are machinery provisions and not charging section. However, the appellant has contended before CIT(A) that it keeps the issue of late filing fees open if the Gujarat High Court judgment (supra) is reversed either by larger bench or the Supreme Court."
ITA Nos. 869 to 890/Ahd/2018 Anthem GXP Solutions Pvt Ltd Vs. DCIT Assessment Year : 2013-14, 2014-15 & 2015-16 Page 5 of 5
6. However, in our considered view, the matter is clearly covered by the Hon'ble jurisdictional High Court's judgment. There is no good reason to keep the matter pending at this level. In case the assessee is aggrieved, it is indeed open to him to take the matter to the higher judicial forum; but, merely because some other appeal on similar ground could be pending before the Hon'ble Courts above and the assessee has a chance to get a favourable verdict in future, we cannot keep these appeals pending forever. The issue being squarely covered against the assessee by the Hon'ble jurisdictional High Court's judgment in the case of Rajesh Kourani (supra), we find the appeals are devoid of any merit and we accordingly reject the same.
7. In the result, appeals are dismissed. Pronounced in the open court today on 8th day of June, 2018.
Sd/- Sd/-
Ms. Madhumita Roy Pramod Kumar
(Judicial Member) (Accountant Member)
Ahmedabad, the 8th day of June, 2018
*bt
Copies to: (1) The appellant
(2) The respondent
(3) Commissioner
(4) CIT(A)
(5) Departmental Representative
(6) Guard File
By order
TRUE COPY
Assistant Registrar
Income Tax Appellate Tribunal
Ahmedabad benches, Ahmedabad
1. Date of dictation: .08.06.2018................
2. Date on which the typed draft is placed before the Dictating Member: .....08.06.2018......
3. Date on which the approved draft comes to the Sr. P.S./P.S.: . 08.06.2018.
4. Date on which the fair order is placed before the Dictating Member for Pronouncement:...
08.06.2018..
5. Date on which the file goes to the Bench Clerk : .... 11.06.2018..................
6. Date on which the file goes to the Head Clerk : ..................................
7. The date on which the file goes to the Assistant Registrar for signature on the order: .........
8. Date of Despatch of the Order: ........................