TDS Return Filing in Form 24Q Instead of 26Q Shouldn’t Attract Late Fees if No Revenue Loss

Birla Cement Works STFF Provident fund Vs ITO (ITAT Jodhpur)

This summary discusses the Income Tax Appellate Tribunal (ITAT) Jodhpur’s judgment regarding three appeals filed by Birla Cement Works Staff Provident Fund against the Income Tax Officer (ITO). These appeals arise from orders by the CIT(A), National Faceless Appeal Centre, Delhi, dated 27.03.2023, for the assessment year 2020-2021.

Grounds of Appeal

The appellant raised several grounds challenging the CIT(A)’s dismissal of their appeals:

1. The CIT(A) erred in concluding that the appeal was filed beyond the permissible time.
2. The CIT(A) incorrectly interpreted the Supreme Court’s extension of the limitation period.
3. The CIT(A) neglected to consider further Supreme Court orders extending the limitation period due to COVID-19.
4. The CIT(A) failed to decide the case on its merits.

Case Background

Birla Cement Works Staff Provident Fund is a recognized provident fund set up under the Employees Provident Fund & Miscellaneous Provisions Act, 1952. The fund’s activities include collecting contributions, managing funds, maintaining records, and disbursing pensions. The dispute arose when the fund paid interest to ex-employees on their provident fund balances and deducted tax at source (TDS), depositing it timely with the central government and filing TDS returns in Form 24Q. However, they later discovered that these deductions should have been filed in Form 26Q. Attempts to correct this were unsuccessful due to technical issues on the TRACES portal, leading them to file a new return in Form 26Q. This new return was treated as delayed, resulting in a late fee of ₹96,800 for 484 days, as communicated on 14.07.2021.

CIT(A) Decision

The CIT(A) dismissed the appeal, stating:

1. The order under dispute was passed on 30.11.2020 and served on 30.11.2020 via email.
2. The extended limitation period due to COVID-19 ended on 13.06.2021. Since the appeal was filed on 27.10.2021, it was delayed.
3. Even if the service date of 14.07.2021 was considered, the appeal period would end on 13.08.2021, still rendering the appeal late.
4. The appellant claimed no delay in Form 35, submitting incorrect verification, and did not seek condonation of delay.

Appellant’s Arguments

The appellant contended:

1. They did not receive the intimation dated 30.11.2020, and the demand notice was received on 14.07.2021.
2. Due to COVID-19, the Supreme Court extended the limitation period, culminating in an exclusion from 15.03.2020 to 28.02.2022.
3. Their appeal filed on 27.10.2021 fell within this extended period, making it timely.

ITAT Findings

The ITAT observed:

1. The appellant complied with Chapter XVII of the Income Tax Act and deducted tax on interest payments timely.
2. Technical issues on the TRACES portal prevented correction of Form 24Q to 26Q, necessitating a new return in Form 26Q.
3. The Central Processing Cell of TDS treated this new return as delayed, resulting in a late fee.
4. The Supreme Court extended the limitation period, which the CIT(A) overlooked in their decision.

ITAT Decision

The ITAT concluded:

1. The appeal was filed within the extended limitation period due to COVID-19.
2. The CIT(A) should have considered the merits of the case, not just procedural aspects.
3. Similar cases, such as GB Builders vs. ACIT (ITAT Ahmedabad) and Sh. Gurpreet Singh vs. ACIT (ITAT Chandigarh), support the appellant’s position.

Merits of the Case

On the merits, the appellant argued:

1. A technical mistake led to the TDS return being filed in Form 24Q instead of 26Q.
2. Upon realizing the mistake, they filed correction statements, which the TRACES portal did not accept.
3. They subsequently filed Form 26Q, which was processed as a new return, resulting in an undue late fee.
4. Jurisprudence supports the view that technical errors should not attract late fees when no revenue loss occurred.

Conclusion

The ITAT ruled in favor of the appellant, acknowledging that the appeal was timely filed within the extended period due to COVID-19 and that the CIT(A) should address the merits of the case. The late fee imposed due to a technical filing error was deemed inappropriate, given the circumstances and supporting case law.

FULL TEXT OF THE ORDER OF ITAT JODHPUR

These three appeals are filed by the assessee and are arising out of the order of the CIT(A), National Faceless Appeal Centre, Delhi all dated 27.03.2023 [Here in after referred as “Ld.CIT(A)” ] for the assessment years 2020-2021 respectively.

2. Since, the facts of all the cases are identical, we have heard these cases together and passing the order together. The facts and grounds are taken from the folder of Birla Cement Works STFF Provident Fund in ITA No. 183/Jodh/2023 and this case is taken as lead case. In this appeal the assessee has raised following grounds:-

“1. In the facts & circumstances of the appeal the ld. CIT Appeals had erred in deciding that the appeal was filed beyond permissible time.

2. In the facts & circumstances of the appeal the ld. CIT Appeals had erred in deciding that the extended period of limitation by the Honorable Supreme Court was expired from 90 days from 15.03.2021.

3. In the facts & circumstances of the appeal the ld. CIT Appeals was grossly negligent in not taking contingence of the further order of the Supreme Court for extention of limitation due to Covid-19.

4. In the facts & circumstances of the appeal the ld. CIT Appeals was erred in not deciding the case on merits at all.

5. We reserve our right to add, amend, alter, or drop any of the grounds of the appeal.”

3. Brief fact of the case are that the assessee Birla Cement Works Staff Provident Fund is recognized provident fund, set up under the employees Provident Fund & miscellaneous provisions Act, 1952 approved by the regional Provident Fund Commissioner. The fund is doing all the activities which are required to be undertaken under the PF and other statutory act viz collect the contribution from employees & employer, manage the PF funds, maintain the records and accounts of employees, distribution the superannuation and pension and also make the compliance of the law under the various statutory law. During the period, assessee has paid interest to PF account holder on their provident fund balance on those cases where provident fund was not withdrawn by the employee after retirement from the service. The due compliance of Chapter XVII of the Income Tax Act was made by the assessee trust and tax was deducted on the interest payment made to ex-employee. The assessee trust has also deposited TDS timely to the central government account and filed TDS return in Form 24Q on or before the prescribed due dates under the law. Later on, it was comes to knowledge to assessee that the data of same deduction has to file in Form No. 26Q hence immediately trust made efforts to file correction statement. However, due to technically reason Traces has not allowed to make correction in Form 240 and also not permitted to replace the data in Form No 26Q directly through correction statement. Therefore, assessee trust compelled to file return in another Form 26Q and the same Form was processed u/s 200A of the Income Tax Act 1961 by the Central processing Cell of TDS treated the same return as a new return. Accordingly, the Central processing Cell of TDS has imposed late fee of Rupees 96,800/- considering the delay of 484 days ignoring the facts of the case. The intimation of demand in this regard was received to assessee on 14.07.2021 from the jurisdiction assessing officer.

4. Aggrieved from the above order of the Assessing Officer, assessee preferred an appeal before the ld. CIT(A). Apropos to the grounds of the appeal so raised by the assessee, the relevant findings of the ld. CIT(A) after considering the remand report in the appeal of the assessee was dismissed and the relevant findings of the ld. CIT(A) is reiterated here in below:-

“4.1 As per Colum No. 14 of Form No. 35, the appellant has stated that there is no delay in filing appeal. In this regard, the relevant portion of Form No. 35 is tabulated below:-

As can be seen from the above, the order under dispute is order u/s 200A of the Act, which is also attached as mandatory attachment. As per the order under section of the 200A attached as a mandatory attachments, the date of filing of regular statement for Quarter 1 of F.Y. 2019-20 is 26.11.2020 and the date of order passed is 30.11.2020. As per the normal practice of the Department, the order u/s 200A is generally served on the appellant by email on the same day. The appellant has also attached another document being Communication Ref No. 01072021/00185/CD on the subject of “Intimation of Outstanding Demand issued by the ITO, TDS, Bilwara, Rajasthan. On face of the Communication Ref No. 01072021/00185/CD, it appears that, the date of communication is 01.07.2021 and it appears that, the appellant has received the communication on 14.07.2021, which is mentioned in column No.2C of Form No 35 being the date of service of the demand notice instead of mentioning the date of service of order u/s 200A.

4.2 Further, the appellant has also attached a copy of CBDT’s Circular No. 10/2021, vide F. No. 225/49/2021/ITA-II, dated 25.05.2021. The circular No. refers to the decision of the Hon’ble Supreme Court / Suo Moto Writ petition (Civil) no. 3 of 2020. The relevant portion of which is reproduced hereunder:

“in computing the period of limitation for any suit, appeal, application or proceeding, all persons shall have limitation of 90 days from 15.03.2021”.

4.3 In view of the above discussion in para 4.1, the date of service of the order under dispute u/s 200A of the Act, is not very clear. There could be two situations:

Situation 1: In this situation, order u/s 200A of the Act, dated 30.11.2020 was served on the appellant on 30.11.2020 itself by email. In that case, the normal time for the filing of appeal as per the provisions of the Act is 30.12.2020. However, in view of the order of the Hon’ble Supreme Court / Suo Moto Writ petition(Civil) no. 3 of 2020, the date gets extended to 13.06.2021 i.e. three months from 15.03.2021. However, the appellant has filed the present appeal on 27.10.2021. Therefore, it is stated that even after considering the extended time limit granted by the Hon’ble Supreme court, still there is a delay in filing appeal.

Situation 2: As stated earlier, the appellant has mentioned the date of service of the order under dispute i.e. order u/s 200A as 14.07.2021. However, as stated earlier, it appears that the date of service mentioned by the appellant of 14.07.2020 appears to be the date of service of the Communication Ref. No. 01072021/00185/CD dated 01.07.2021. But still, even if the date 14.07.2021 is adopted as the date of service of the order u/s 200A, even in that case, the time limit for filing appeal would expire on 13.08.2021. However, the appellant has filed an appeal on 27.10.2021. Therefore, it is stated that even in this situation, there is a delay in filing appeal.

In view of the above, the Circular No. 10/2021, vide F.No. 225/49/2021/ITA-II, dated 25.05.2021 and the decision of the Hon’ble Supreme Court, is not of any help to the appellant as it is not applicable to the case of the appellant.

4.4 Further, in column No. 14 of Form No. 35, the appellant has categorically stated that there is no delay in filing of appeal. In this regard, the form of verification in Form No. 35 is reproduced here under:-

“I, Yogesh Kabra, the appellant, do hereby declare that what is stated above is true to the best of my information and belief. It is also certified that no additional evidence other than the evidence stated in row 12.1 above has been filed”.

In view of the facts narrated above, it is stated that, the appellant has filed false statement of verification under the Income Tax Act, 1961. The legislature has given such an importance to the Verification Column to the extent that even prosecution proceedings are envisaged as per the provisions of section 277 of the Act.

4.5 As stated above, the appellant has not filed the appeal within the prescribed time nor sought for condonation of delay in filing appeal in the Form No. 35 Moreover, the appellant has also furnished wrong information in Form No. 35 and hence has also filed a false verification under the Act. Further, even during the appellate proceedings, the appellant has not sought for condonation of delay Therefore, the present appeal is held to be an invalid appeal and hence is not adjudicated upon

5. In the result, the appeal is treated as dismissed for statistical purposes.”

5. Feeling dissatisfied from the above order of the ld. PCIT, the assessee has preferred the present appeal on the ground as stated hereinabove. In support of the grounds so raised the ld. AR appearing on behalf of the assessee has placed reliance on the written submission which is extracted herein below:-

“The assessee M/s Birla Cement Works Staff Provident Fund (“Trust” or “appellant”) is recognized provident fund, set up under the Employees Provident Funds & Miscellaneous Provisions Act, 1952

During the period, assessee has paid interest to PF account holder on their provident fund balance on those cases where provident fund was not withdrawn by the employee after retirement from the service. The due compliance of Chapter XVII of the Income Tax Act was made by the assessee trust and tax was deducted on the interest payment made to ex-employee regularly. The assessee trust has also deposited TDS timely to the central government account and filed TDS return in Farm 24Q on 29.10.2019 within the prescribed due dates under the law.

Later on, it comes to knowledge to assessee that the data of the same deduction wherein the interest paid to retired employee on their provident fund balances have to file in Form No. 26Q hence immediately trust made efforts to file correction statement. However, due to technical reason Traces has not allowed to make correction in Form 24Q and also not permitted to replace the data in Form No 26Q directly through correction statement.

Therefore, assessee trust compelled to file correction statement of 24Q on 23.11.2020 by nullifying the data filed in original return and another Form 26Q has been filed on 26.11.2020 and the same Form was processed u/s 200A of the Income Tax Act 1961 by the Central processing Cell of TDS treated the same return as a new return Accordingly, the Central processing Cell of TDS has imposed late fee of Rupees 78400/-considering the delay of 392 days ignoring the facts of the case vide order dated 30.11.2020. The intimation of demand in this regard was received to assessee on 14-07-2021 from the jurisdiction assessing officer and being aggrieved with order, assessee has filled appeal before CIT Appeals on 30.10.2021.

The appeal was rejected by CIT Appeals (Faceless Center) on 27.03.2023 on the ground that there was delay in filling the appeal & Condonation application was also not filled & not Prayed. (by ignoring the order of honorable supreme court to exclude the Covid period for calculation of time limit)

Grounds of Appeal:-

1. In the facts & circumstances of the appeal the Id. CIT Appeals has erred in deciding that the appeal was filled beyond permissible time.

2. In the facts & circumstances of the appeal the Id. CIT Appeals has erred in deciding that the extended period of limitation by the Honorable Supreme court was expired from 90 days from 15.03.2021.

3. In the facts & circumstances of the case the Id. CIT Appeals was grossly negligent in not taking cognizance of the further order of the supreme court for extension of limitation due to Covid19.

Our detailed representation on all the above three grounds is as under:

The intimation dated 30.11.2020 was not received by the assessee and notice of due demand in this regard was received to assessee on 14-07-2021 from the jurisdiction assessing officer and being aggrieved with the order, assessee has filled appeal before CIT Appeals on 30.10.2021.

Due to Covid period in March 2020, the honorable supreme court has taken suo moto cognizance of difficulties that might be faced by the litigants in filling petitions/ applications /suits/ appeals / all other quasi proceedings within the period of limitation prescribed under the general law of limitation or under any special laws (both Central and/or State) due to the outbreak of the COVID19 pandemic.

Later on in this matter the honorable supreme court on 10.01.2022 directed in para no 5(1) in order, as under:

…. The order dated 23.03.2020 is restored and in continuation of the subsequent orders dated 08.03.2021, 27.04.2021 and 23.09.2021, it is directed that the period from 15.03.2020 till 28.02.2022 shall stand excluded for the purposes of limitation as may be prescribed under any general or special laws in respect of all judicial or quasi judicial proceedings.” (Bold and underline inserted)

However, while deciding the appeal the Id. CIT appeals has only noticed, the order of honorable supreme court of March 2020 but ignored all the further extensions specially dated 10.01.2022 where in the extension was further extended up to 28.02.2022.

Hence as per the said order our appeal was filed within extended time so it was not time barred. And the Id CIT appeal has grossly erred in rejecting the said appeal treating it time barred.

Grounds of Appeal:-

4. In the facts & circumstances of the case the Id. CIT Appeals was erred in not deciding the case on merits at all.

The learned CIT appeals has rejected the appeal treating it time barred (however it was not) without considering the matter on merit.

On the merit we request as under:

(a) By misconception of the assess that the TDS was related to salary hence the assessee has filed TDS return in Form24Q instead of 260, (because TDS was on interest and not on salary) well in time on 29.10.2019.

As the assessment was done by CPC the said facts could not be known to CPC but the learned commissioner appeal must have considered the facts that it was only a technical mistake.

(b) Later on assessee has realized that a technical mistake was committed while filling TDS return, since the payment was in nature of interest the TDS return should be filed in 26Q. But no remedy was available to correct the mistake.

(c) Since there was no option to correct the head of payment in Form 24Q So the assessee was compelled to file new Form 26Q on 26.11.2020, and the correction statement of 24Q on 23.11.2020 after nullifying the data filed in original return.

(d) Since once the details of TDS has been duly filed in Form 24Q and filling of Form 26Q was only a corrective measure to rectify the technical mistake committed in form 24Q therefore it should not be considered as a new return for the purpose of imposing late fee.

considering the fact that no loss is caused to the Revenue, the assessee cannot be saddled with levy of late filing fee u/s 234E of the Act, taking a judicious view of the matter

We have relied upon following case law

Our above contentions are also supported by following juridical pronouncements:

1. GB Builders-Vs-ACIT-ITAT-Ahmedabad

In this matter it was held that-

“Once the assessee has initially deposited TDS and furnished Statement in Form 26QB within time, but committed a technical error while depositing TDS resulting in non-grant of TDS to transferor, compelling it to again deposit TDS along with interest for late deposit, then, in the interests of justice and considering the fact that no loss is caused to the Revenue, the assessee cannot be saddled with levy of late filing fee u/s 234E of the Act. taking a judicious view of the matter. In result, we hold that Ld. CIT(A) has erred in law and in facts in upholding levy of penalty u/s 234E of the Act.”

2. Sh.-Gurpreet-Singh-Vs-ACIT-ITAT-Chandigarh

“However, there also cannot be any denial that where the lapse came about due to a mere technical error, like the one in the present case, ie, inadvertent wrong filing of TDS Statement, i c., in Form No. 26QB, rather than in the applicable Form No. 270, there is no case for levy of late filing fee u/s 234E of the Act.”

It is requested that on the ground of limitation and merit our appeal may be allowed and late fee be deleted.”

6. The ld. AR of the assessee also filed a detailed paper book to contest the grounds so raised in this appeal. The ld. AR of the assessee that case of the assessee is very much on factual and covered by the decision of the other bench of the ITAT. Considering that aspect of the matter the ld. AR of the assessee submitted that the assessee being small trust it would be in the interest of justice if the assessee is granted the justice by bench considering the covered similarly matter decided by the other benches. The assessee filed the following documents in support of the contentions:-

7. On the other hand, the ld. DR relied upon the orders of the lower authorities and submitted that the appeal of the assessee is not decided on merits by the ld. CIT(A) and the same is dismissed as the assessee has not submitted the reasons for the delay in filling the appeal. So even if the bench condone the delay the same is required to be decided on merits by the ld. CIT(A).

8. We have heard the rival contentions, perused the material placed on record and gone through the judicial precedent cited by both the parties to drive home their respective contentions. The bench noted that the ld. CIT(A) has decided the appeal of the assesseeconsidering the fact that the appeal filed by the assessee was delayed whereas the same was not as per the contention of the assessee. The assessee on this issue has submitted as under:

The intimation dated 30.11.2020 was not received by the assessee and notice of due demand in this regard was received to assessee on 14-07-2021 from the jurisdiction assessing officer and being aggrieved with the order, assessee has filled appeal before CIT Appeals on 30.10.2021.

Due to Covid period in March 2020, the honorable supreme court has taken suo moto cognizance of difficulties that might be faced by the litigants in filling petitions/ applications /suits/ appeals / all other quasi proceedings within the period of limitation prescribed under the general law of limitation or under any special laws (both Central and/or State) due to the outbreak of the COVID19 pandemic.

Later on in this matter the honorable supreme court on 10.01.2022 directed in para no 5(1) in order, as under:

…. The order dated 23.03.2020 is restored and in continuation of the subsequent orders dated 08.03.2021, 27.04.2021 and 23.09.2021, it is directed that the period from 15.03.2020 till 28.02.2022 shall stand excluded for the purposes of limitation as may be prescribed under any general or special laws in respect of all judicial or quasi judicial proceedings.” (Bold and underline inserted)

However, while deciding the appeal the Id. CIT appeals has only noticed, the order of honorable supreme court of March 2020 but ignored all the further extensions specially dated 10.01.2022 where in the extension was further extended up to 28.02.2022.

The date of filling the appeal was 27.10.2021 and the date of order is 30.11.2020. The period of exclusion is from 15.03.2020 till 02.10.2021, notwithstanding the actual balance period of limitation remaining all person shall have a limitation period of 90 days from 03.10.2021. Thus the appeal in this case is filed within the 90 days from 03.10.2021 i.e. on 27.10.2021. Considering that aspect of the matter and the prayer of the assessee that even the matter is not required to be tested on any of the factual aspect but the legal issue be decided by the bench on merits as per ground raised by the assessee. The bench noted that the assessee Birla Cement Works Staff Provident Fund is recognized provident fund, set up under the employees Provident Fund &Miscellaneous Provisions Act, 1952 approved by the regional Provident Fund Commissioner. The fund is doing all the activities which are required to be undertaken under the PF and other statutory act viz collect the contribution from employees & employer, manage the PF funds, maintain the records and accounts of employees, distribution the superannuation and pension and make the compliance of the law under the various statutory law. During the period, assessee has paid interest to PF account holder on their provident fund balance on those cases where provident fund was not withdrawn by the employee after retirement from the service. The due compliance of Chapter XVII of the Income Tax Act was made by the assessee trust and tax was deducted on the interest payment made to ex-employee. The assessee trust has also deposited TDS timely to the central government account and filed TDS return in Form 24Q on or before the prescribed due dates under the law. The same is verifiable from the exact given here in below;

Thus, it is clear that the assessee has paid tax on 07.05.2019, 07.06.2019 and 04.07.2019. Later on, when it was came to the knowledge to the assessee that the data of same deduction has to file in Form No. 26Q hence immediately trust made efforts to file correction statement. However, due to technically reason Traces has not allowed to make correction in Form 24Qand also not permitted to replace the data in Form No 26Q directly through correction statement. Therefore, assessee trust compelled to file return in another Form 26Q and the same Form was processed u/s 200A of the Income Tax Act 1961 by the Central processing Cell of TDS treated the same return as a new return. Accordingly, the Central processing Cell of TDS has imposed late fee of Rupees 96,800/- considering the delay of 484 days ignoring the facts of the case. The intimation of demand in this regard was received to assessee on 14.07.2021 from the jurisdiction assessing officer. Thus, it is evidently clear that there is no delay in payment of taxes but due to the technical glitches on the part of the system the correct form is uploaded. The similar issue has been decided by the ITAT bench of Ahmedabad in ITA no. 626/Ahd/2018. The relevant finding of the co­ordinate bench is as under :

“6. We have heard the rival contentions and perusal the material on record. We note that in the present facts, the assessee had initially deposited the entire TDS in respect of purchase of immovable property on 24-11-2014 u/s 194-IA of the Act i.e. within the due date from purchase of immovable property. Due to certain technical error committed (incorrect interchanging of PAN numbers of buyer and seller in online filing of Statement 26QB), the seller could not get credit of TDS and later, on the advise of Revenue authorities again the buyer (the assessee) paid the TDS again amount alongwith interest for late deposit. The CPC, Ghaziabad processed revised form 26QB filed on 16-12-2015 u/s. 200(A)(1) and on 07-02-2016 raised a demand of late fee of Rs. 74,600/- u/s. 234E of the Act. In appeal, the Ld. CIT(A), mechanically relied upon the jurisdictional High Court decision in the case of Rajesh Kourani vs. Union Of India (2017) 83 taxmann.com 137 (Gujarat) to uphold levy of late filing fee of Rs. 74,600/- u/s. 234E of the Act for late filing of TDS statement. However, in our considered view, the issue for consideration in Rajesh Kourani case supra and the issue for consideration in the assessee’s case are different. The Gujarat High Court in the case of Rajesh Kourani supra held that section 234E is a charging provision creating a charge for levying fee for certain defaults in filing statements and fee prescribed under section 234E and could be levied even without a regulatory provision being found in section 200A for computation of fee. The assessee is not disputing that at the time of filing of revised Form 26QB on 16-12-2015, s. 234E of the Act (which came into effect from 01- 06-2015) was in force and in effect. The issue for consideration is when the assessee had initially deposited TDS u/s 194-IA of the Act and accordingly filed TDS statement within due date from time when the immovable property was transferred, but committed a technical default while filing the TDS Statement resulting into non-grant of TDS credit, compelling the assessee to again deposit TDS along-with interest, can the assessee be penalized for late filing of revised TDS Statement u/s 234E of the Act. In our considered view, the Ld. CIT(A) has not taken a judicious view of the matter while upholding levy of late filing fee of Rs. 74,600/- u/s. 234E of the Act in the particular facts of the case. The Ld. CIT(A) did not take into consideration the peculiar facts and circumstances of the instant case, where the assessee had initially deposited TDS u/s 194-IA of the Act on purchase of immovable within due date on 24-11-2014. Due to a technical error, since the seller could not get credit of TDS deposited in the initial deposit, on the advise of Revenue Authorities, the assessee had again deposited TDS along-with late filing interest Rs. 46,977/- payable for 14 months on 16-12-2015. Ld. CIT(A) also did not appreciate that had the assessee at the time of initial deposit of TDS mentioned the correct PAN numbers i.e. had the assessee not committed the aforesaid technical error, there would have been no question of levy of interest u/s 234E of the Act. The Ld. CIT(A) also did not take cognizance of the fact that in the facts of the case, there was no loss caused to the Revenue. While, respectfully following the jurisdictional High Court in the case of Rajesh Kourani supra, we are also of the view that machinery provisions cannot override the substantive provisions, but in the instant facts, the issue for consideration and facts before us are different as compared to Rajesh Kourani case (supra), on which reliance has been mechanically placed by Ld. CIT(A). It is a settled law as held by the Hon’ble Gujarat High Court in the case of Rajkot Engineering Association v. UOI [1986] 26 Taxman 60 (Gujarat) that the Revenue authorities should adopt a judicial approach and consider all attendant circumstances. Again, the Gujarat High Court in the case of Trust For Reaching The Unreached Through Trustee v. Commissioner of Income Tax (Exemptions), Ahmedabad[2021] 126 taxmann.com 77 (Gujarat) has stressed the need for the Revenue Authorities taking a judicious approach. The Gujarat High Court in the case of Sarvodaya Charitable Trust v. ITO 2021] 125 taxmann.com 75 (Gujarat) held that the approach of the authorities should be justice oriented so as to advance the cause of justice. The Gujarat High Court in the case of CIT v. Gujarat Oil and Allied Industries Ltd. [1993] 201 ITR 325 (Guj.), took the view that the benefit of exemption should not be denied merely on account of delay in furnishing the same and it is permissible for the assessee to produce the audit report at a later stage either before the Income-tax Officer or before the appellate authority by assigning sufficient cause. In view of various authorities cited above, we are of the considered view that Ld. CIT(A) did not consider the facts and attendant circumstances of the case while upholding levy of penalty u/s 234E of the Act. Once the assessee has initially deposited TDS and furnished Statement in Form 26QB within time, but committed a technical error while depositing TDS resulting in non-grant of TDS to transferor, compelling it to again deposit TDS along-with interest for late deposit, then, in the interests of justice and considering the fact that no loss is caused to the Revenue, the assessee cannot be saddled with levy of late filing fee u/s 234E of the Act, taking a judicious view of the matter. In result, we hold that Ld. CIT(A) has erred in law and in facts in upholding levy of penalty u/s 234E of the Act.

7. In the result, appeal of the assessee is allowed.”

On being consistent to the finding so recorded by the co ordinate bench of the ITAT, Ahmedabad we respectfully following that finding direct the ld. AO to delete the levy of penalty of Rs. 96,800/-

In terms of this observation the appeal of the assessee in ITA no. 183/Jodh/2023 stands allowed.

9. The fact of the case in ITA Nos. 184 and 185/Jodh/2023 is similar to the case in ITA No. 183/Jodh/2023 and we have heard both the parties and persuaded the materials available on record. The bench has noticed that the issues raised by the assessee in this appeal No. 184and 185/Jodh/2023 is equally similar on set of facts and grounds. Therefore, it is not imperative to repeat the facts and various grounds raised by both the parties. Hence, the bench feels that the decision taken by us in ITA No. 183/Jodh/2023 shall apply mutatis mutandis in the case of Birla Cement Works Provident Fund in ITA Nos. 184 and 185/Jodh/2023.

In the result, three appeals of the assessee are allowed.

Order pronounced under Rule 34(4) of the Income Tax (Appellate Tribunal) Rules, 1963 by placing the details on the notice board.