Wp(C) v. Wp(C)

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR. JUSTICE BECHU KURIAN THOMAS TUESDAY, THE 24 DAY OF MAY 2022 / 3RD JYAISHTA, 1944 WP(C) NO. 16664 OF 2022 PETITIONER: AMARAVATI RPERESENTED BY ITS MANAGING PARTNER MOHANDAS P SAGED 67 YEARS12/707,PUTHUR ROAD, KOPPAM, PALAKKAD, PIN - 678001BY ADVS.P.J.ANILKUMAR (A-1768)K.N.SREEKUMARANN.SANTHOSHKUMAR RESPONDENTS: 1INCOME TAX OFFICER (TDS)AAYKAR BHAVAN, PIN - 6781012DEPUTY COMMISSIONER OF INCOME TAXTDS CPC,AAYKAR BHAVAN, SECTOR-3,VAISHALI, GAZIABAD,UTTARPRADESH, PIN - 2010103CENTRAL BOARD OF DIRECT TAXES REPRESENTED BY ITS CHAIRMANNORTH BLOCK, NEW DELHI, PIN - 1100024UNION OF INDIA REPRESENTED BY ITS SECRETARYMINISTRY OF FINANCE,DIRECT TAX DEPARTMENT,NEW DELHI, PIN - 110001BY ADVS.CHRISTOPHER ABRAHAM, INCOME TAX DEPARTMENTSRI.MANU.S, CGC THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON24.05.2022, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: BECHU KURIAN THOMAS, J. ----------------------------------------- W.P.(C) No.16664 of 2022 ---------------------------------------- Dated this the 24[th] day of May, 2022 JUDGMENT As an assessee under the Income Tax Act, 1961,petitioner had deducted TDS, for payments made by himand remitted the same to the Income Tax Department.While filing the statement of returns regarding theremittance of TDS, delay occurred. When the returns wereprocessed, the second respondent, on noticing the delay infiling the statement of TDS remittance, levied late fee undersection 234E of the Act. 2. By Ext.P1 to Ext.P5 intimations, petitioner was called upon to pay the late filing fee under section 234E of theIncome Tax Act, 1961 (for short,'the Act'). As per theaforesaid intimations, amounts have been demanded as latefee for the periods from 2012-13 to 2014-15 on the basis of the provisions in section 234E of the Act, which is as follows: “234E-Feefordefaultinfurnishingstatements:-(1) Without prejudice to theprovisions of the Act, where a person fails to deliveror cause to be delivered a statement within the timeprescribed in sub-section (3) of Section 200 or theproviso to subsection (3) of section 206C, he shallbe liable to pay, by way of fee, a sum of twohundred rupees for every day during which thefailure continues.” 3. According to the petitioner, though section 234E of the Act was introduced by the Finance Act, 2012 with effectfrom 1st July, 2012, since petitioner is being demanded topay, by Ext.P1 to Ext.P5, late fee for not filing the statementof tax deduction at source, it is necessary to refer to section200A of the Act. It was further submitted that Section200A(1) incorporated clause (c) only with effect from01.06.2015. Sub-clause (c) to section 200A (1) refers to thefee if any to be computed in accordance with the provisionsof section 200A(1)(e). It is the claim of the petitioner thattill 01.06.2015 petitioner cannot be mulcted with anyliability to pay late fee for non filing of any statement of taxdeduction at source. WP(C) NO. 16664 OF 2022 4 3. According to the petitioner, though section 234E of the Act was introduced by the Finance Act, 2012 with effectfrom 1st July, 2012, since petitioner is being demanded topay, by Ext.P1 to Ext.P5, late fee for not filing the statementof tax deduction at source, it is necessary to refer to section200A of the Act. It was further submitted that Section200A(1) incorporated clause (c) only with effect from01.06.2015. Sub-clause (c) to section 200A (1) refers to thefee if any to be computed in accordance with the provisionsof section 200A(1)(e). It is the claim of the petitioner thattill 01.06.2015 petitioner cannot be mulcted with anyliability to pay late fee for non filing of any statement of taxdeduction at source. WP(C) NO. 16664 OF 2022 4 4. A statement has been filed by the respondentsobjecting to the claim of the petitioner. It is averred that thedemands of late filing fee under section 234E of the Actwere raised by orders issued from 2013 till 2016 and thatthe demands are still outstanding. The intimations issued bythe department were all appealable orders under section246A of the Act and the petitioner failed to challenge thelevy of late fee. In such circumstances, the demands havebecome final and the petitioner has accepted the demands.Respondents also pleaded that the delay is a ground torefuse an appropriate relief so as to avoid unsettling thesettled things. Relying upon the decisions in State ofMaharashtra v. Digambar(AIR 1995 SC 1991),G.C.Gupta and Others v. N.K.Pandey and Others[(1988) 1 SCC 316] and State of M.P. And Another v.Bhailal Bhai (AIR 1964 SC 1006), it was asserted that thedelay must defeat the claim raised by the petitioner. 5. I have heard Sri.P.J.Anilkumar, learned counsel forthe petitioner, Sri.Christopher Abraham, learned StandingCounsel for the respondents 1 to 3 as well as Sri.S.Manu, learned Assistant Solicitor General of India for the fourthrespondent. 6. I have considered the rival contentions. 7. In the decision in M/s.Sarala Memorial Hospital v. Union of India and Another (W.P.(C) No.37775 of2018) an identical question arose for consideration. Afterconsidering the statutory provisions of section 234E andsection 200A of the Act and the implications of theamendment brought in to the Act, it was held that theamendment would take effect only from 1st June, 2015 andis thus prospective in nature. The aforesaid judgment hasbecome final and is binding upon the authorities. Thus thejurisdiction to levy late fee under section 234E arises onlyfrom 01-06.2015 and not earlier. 8. As regards the contention on the delay, though thesaid contention was impressive on first blush, it can be seenthat the nature of challenge raised by the petitioner is basedupon the lack of jurisdiction of the respondents to imposelate fee. Since in matters where total lack of jurisdiction is 6 alleged, delay cannot be relied upon as a ground to deny therelief, this Court is of the view that the objections of therespondents are without any basis. 9. Further the decisions cited are distinguishable on the facts of those cases itself. In the decision in Digambar'scase (supra), the delay of 20 years in approaching the HighCourt for grant of compensation for alleged utilization of theland was held as a decisive factor to disentitle the petitionertherein. Similarly in G.C.Gupta's case (supra) the issuerelated to seniority and petitioners challenged the orders ofconfirmation and determination of inter se seniority onlyafter 15 years. In the decision in Bhailal Bhai's case(supra) the question related to refund of tax claimedbelatedly. None of those cases related to a total lack ofjurisdiction or authority. 10. In view of the above, the demand in Ext.P1 to Ext.P5 intimations for the period from 2012-13 to 2014-15is bereft of authority and cannot be legally sustainable. 11. Accordingly, I quash Ext.P1 to Ext.P5 intimations to 10. In view of the above, the demand in Ext.P1 to Ext.P5 intimations for the period from 2012-13 to 2014-15is bereft of authority and cannot be legally sustainable. 11. Accordingly, I quash Ext.P1 to Ext.P5 intimations to the extent it demands late fee under section 234E for theperiod from 2012-13 till 01.06.2015. The writ petition is therefore allowed as above. Sd/- AJM BECHU KURIAN THOMAS JUDGE APPENDIX OF WP(C) 16664/2022 PETITIONER’S EXHIBITS : Exhibit P1TRUE COPY OF THE INTIMATION OF LEVY U/S 234E, AGAINST 26Q OF Q2 FOR F.Y: 2012-13ISSUED BY THE 2ND RESPONDENT TO THE PETITIONER.Exhibit P2TRUE COPY OF THE INTIMATION OF LEVY U/S 234E, AGAINST 26Q OF Q3 FOR F.Y: 2012-13ISSUED BY THE 2ND RESPONDENT TO THE PETITIONER.Exhibit P3TRUE COPY OF THE INTIMATION OF LEVY U/S 234E, AGAINST 26Q OF Q2 FOR F.Y: 2013-14ISSUED BY THE 2ND RESPONDENT TO THE PETITIONER.Exhibit P4TRUE COPY OF THE INTIMATION OF LEVY U/S 234E, AGAINST 26Q OF Q3 FOR 2013-14 ISSUED BY THE 2ND RESPONDENT TO THE PETITIONER.Exhibit P5TRUE COPY OF THE INTIMATION OF LEVY U/S 234E, AGAINST 26Q OF Q1 FOR 2014-15 ISSUED BY THE 2ND RESPONDENT TO THE PETITIONER. Exhibit P6TRUE COPY OF THE NOTICE NO. ITBA/COM/F/ 17/2021-22/1037737501(1) DATED 13.12.2021 ISSUED BY THE 1ST RESPONDENT REGARDING TDS DUES INCLUDING LATE FEE UNDER 234E. RESPONDENT’S EXHIBITS :NIL //TRUE COPY// PA TO JUDGE