Karnataka Grameena Bank Vs ACIT (ITAT Bangalore)
ITAT Bangalore held that any ambiguity in a taxing statute should ensure the benefit of the subject/ assessee. Accordingly, the taxing provision of late fee in respect of late filing of TDS return came into force from 01.06.2015. Hence, late fees u/s 234E cannot be levied before 01.06.2015.
Facts-
The assessee filed statement of tax deducted at source (TDS) for various quarters in Form No.26Q for AY 2013-14 to 2015-16 (Financial Years 2012-13 to 2015-16) in respect of its various branches set out in the annexure to this order. The statement was processed by the respondent. There was a delay in filing the above TDS statement and therefore the AO by intimation u/s. 200A of the Income-Tax Act, 1961 [“the Act”] levied late fee u/s. 234E of the Income-Tax Act, 1961 [“the Act”].
The assessee contended that provisions of section 234E was inserted by the Finance Act, 2012 w.e.f. 1.7.2012. Notably, Clause (c) to (f) of section 200A(1) was substituted by the Finance Act, 2015 w.e.f. 1.6.2015. The assessee contended before NFAC (CIT(A)/first appellate authority) that AO could levy fee u/s.234E of the Act while processing a return of TDS filed u/s.200(3) of the Act only by virtue of the provisions of Sec.200A(1)(c), (d) & (f) of the Act and those provisions came into force only from 1.6.2015 and therefore the authority issuing intimation u/s. 200A of the Act while processing return of TDS filed u/s.200(3) of the Act, could not levy fee u/s. 234E of the Act in respect of statement of TDS filed prior to 1.6.2015. The assessee, thus, challenged the validity of charging of fee u/s. 234E of the Act.
Conclusion-
Hon’ble Supreme Court has held that any ambiguity in a taxing statute should ensure the benefit of the subject/assessee. On the contrary, any ambiguity in the exemption clause must be conferred in favour of revenue and such exemption should be allowed to be availed only to those subjects / assesses who demonstrate that a case for exemption squarely falls within the parameters enumerated in the notification and they satisfy all the conditions precedent for availing exemption.
Held that the levy of late fee u/s.234-E of the Act, cannot be said to be an exemption clause but can be construed only as a charging section, in the sense that imposes a burden on an Assessee. In that view of the matter, we are of the view that the reliance placed by the NFAC, on the decision of Hon’ble Supreme Court in the case of M/S.Dilip Kumar & Co. (supra) to sustain the levy of interest u/s.234-E of the Act, cannot be sustained.
FULL TEXT OF THE ORDER OF ITAT BANGALORE
These are a batch of 80 appeals filed by different branches of the Assessee/Appellant Bank, against different orders passed by the National Faceless Appeal Centre (NFAC), Delhi, relating to Assessment Years 2011-12 to 20 15-16. The details of the various branches and the orders of the NFAC, Delhi, are given as an annexure to this order.
