Case Law Details
Atnk & K Area Armed Forces Veterans Canteen Vs DCIT (Kerala High Court)
The Kerala High Court’s recent verdict addressed a crucial issue involving the Atnk & K Area Armed Forces Veterans Canteen, focusing on the delay in TDS return filing. The case centered on the inadvertent filing of Form 24Q instead of the mandated Form 26Q, leading to the imposition of penalties under section 234E of the Income Tax Act. This article provides an in-depth analysis of the case, examining the circumstances, assessment, and the court’s decision to delete the penalty.
Detailed Analysis: The petitioner, an Armed Forces Veterans Canteen, encountered penalties due to a procedural error in filing the quarterly statement for the second quarter of Financial Year 2017-18. Despite promptly deducting and remitting taxes, the petitioner mistakenly submitted Form 24Q instead of the required Form 26Q. This filing error triggered the assessment of a substantial penalty, including a late fee of Rs.47,000, interest of Rs.23,500, and late payment interest of Rs.567.
Challenging the penalties, the petitioner pursued the matter through the appellate process, reaching the Income Tax Appellate Tribunal (ITAT). The ITAT, recognizing the timely filing of quarterly TDS returns, remanded the case to the Assessing Authority for a fresh assessment.
Initially, the Assessing Authority adhered to the ITAT’s directive, resulting in a ‘Nil’ demand. However, in a subsequent order (Ext.P6), the authority reinstated the penalties. The petitioner contested this inconsistency, asserting that the Tribunal had rejected the initial stand. The Tribunal’s stance emphasized that, as the return was filed on time and subsequently corrected to Form 26Q, penalties were unjustified.
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