Chronicle Publication Pvt Ltd, New Delhi vs ACIT (CPC)-TDS, New Delhi | Case Filed Due to Late Filing of TDS Returns for Assessment Year 2015-16 (Qtr 24Q-1)

Case Overview: Chronicle Publication Pvt Ltd, New Delhi vs ACIT (CPC)-TDS, New Delhi

Case Number: ITA 6317/DEL/2019

Appellant: Chronicle Publication Pvt Ltd, New Delhi

Respondent: ACIT (CPC)-TDS, New Delhi

Assessment Year: 2015-16 (Qtr 24Q-1)

Order Date: 31st August 2020

Case Filed On: 26th July 2019

Order Type: Final Tribunal Order

Case Conclusion: आयकर आयकर आयकर आयकर अपीलीय अपीलीय अपीलीय अपीलीय अिधकरण अिधकरण अिधकरण अिधकरण , /g7408द/g7016ली /g7408द/g7016ली /g7408द/g7016ली /g7408द/g7016ली /g7008यायपीठ /g7008यायपीठ /g7008यायपीठ /g7008यायपीठ “ए”, नई नई नई नई /g7408द/g7016ली /g7408द/g7016ली /g7408द/g7016ली /g7408द/g7016ली म/g7286म/g7286 म/g7286म/g7286 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH ‘A’, NEW DELHI सु/g7088ी सु/g7088ी सु/g7088ी सु/g7088ी सुषमा सुषमा सुषमा सुषमा चावला चावला चावला चावला , उपा/g7007य/g6979 उपा/g7007य/g6979 उपा/g7007य/g6979 उपा/g7007य/g6979 एवंएवं एवंएवं डॉ डॉ डॉ डॉ . बी बी बी बी आर आर आर आर आर आर आर आर कुमार कुमार कुमार कुमार , लेखा लेखा लेखा लेखा सद/g7021य सद/g7021य सद/g7021य सद/g7021य क ेक े क ेक े सम/g6979 सम/g6979 सम/g6979 सम/g6979 BEFORE MS. SUSHMA CHOWLA, VP & Dr. B.R.R. KUMAR , AM [THROUGH VIDEO CONFERENCING]

The case filed by Chronicle Publication Pvt Ltd against ACIT (CPC)-TDS, New Delhi, pertained to the late filing of TDS returns for the first quarter of the assessment year 2015-16 under Form 24Q. The main contention of the appellant was against the imposition of late filing fees under Section 234E of the Income Tax Act, 1961, which was charged by the respondent despite the fact that the appellant had filed the returns after the deadline.

Background of the Case

The appellant, Chronicle Publication Pvt Ltd, is a reputed publishing house based in New Delhi. For the assessment year 2015-16, the company had delayed the filing of its TDS returns for the first quarter (24Q-1). The Income Tax Department, represented by the ACIT (CPC)-TDS, New Delhi, issued an intimation under Section 200A of the Income Tax Act, 1961, which included a demand for late filing fees under Section 234E.

The appellant challenged the demand on the grounds that the provisions for levying late filing fees under Section 234E could not be applied retrospectively for the period prior to 1st June 2015. The appellant’s case was supported by various tribunal rulings that had previously held that such fees could not be imposed for returns filed before the specified date.

Tribunal Proceedings

The case was heard by the Delhi Bench ‘A’ of the Income Tax Appellate Tribunal (ITAT) on 25th August 2020, with the final order being pronounced on 31st August 2020. The bench comprised Ms. Sushma Chowla, Vice President, and Dr. B.R.R. Kumar, Accountant Member, who conducted the proceedings via video conferencing due to the ongoing pandemic.

During the hearing, the appellant argued that the legislative amendment which allowed for the levy of late filing fees under Section 234E was prospective in nature, effective from 1st June 2015, and therefore could not be applied to TDS returns for quarters prior to this date. The respondent, on the other hand, contended that the fees were a legitimate charge for the delay, aimed at compensating the Income Tax Department for the additional administrative burden.

Final Judgment

The tribunal, after considering the arguments presented, referred to several precedents, including the decisions of the Karnataka High Court and the Bombay High Court. The tribunal ruled in favor of the appellant, stating that the levy of late filing fees under Section 234E could not be applied to TDS returns filed for periods prior to 1st June 2015, as the enabling provision in Section 200A(1)(c) was introduced only with effect from that date.

The tribunal concluded that the intimation issued by the ACIT (CPC)-TDS, New Delhi, demanding late filing fees under Section 234E for the first quarter of the assessment year 2015-16 was not valid, as the relevant TDS returns were filed before the amendment came into effect. The demand for late filing fees was consequently set aside.

Implications of the Ruling

This ruling reaffirms the position that amendments to tax laws that impose financial liabilities, such as late filing fees, cannot be applied retrospectively unless explicitly stated by the legislature. It provides relief to taxpayers who had filed their TDS returns belatedly before 1st June 2015, ensuring that they are not penalized under the retrospective application of the law.

The case also underscores the importance of timely compliance with tax filing deadlines to avoid potential disputes and the imposition of penalties or fees. Taxpayers are advised to stay informed of any legislative changes that may affect their compliance obligations and to seek timely professional advice to navigate complex tax regulations.

The order was issued on 31st August 2020 and serves as a significant precedent in similar cases involving late filing fees under Section 234E of the Income Tax Act, 1961.

Chronicle Publication Pvt Ltd, New Delhi vs ACIT (CPC)-TDS, New Delhi | Case Filed Due to Late Filing of TDS Returns for Assessment Year 2015-16 (Qtr 24Q-1)