section 234E Archives - Tax Heal

Income Tax में आया जबरदस्त फैसला I LATE FEES नहीं लगेगी i Technical Error I CA Satbir Singh

CA Satbir Singh — Tue, 17 May 2022 05:01:25 +0000

Income Tax में आया जबरदस्त फैसला I LATE FEES नहीं लगेगी i Technical Error I CA Satbir Singh

Download order Click here

Whether Late Fees u/s 234E can be levied for delay in filing TDS Return due to Technical Error?

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.

Fees & Penalty for Delay/ Non filing of TDS Return of Income Tax (FA 2019)

CA Satbir Singh — Thu, 25 Apr 2019 11:30:18 +0000

Fees & Penalty for Delay/ Non filing of TDS Return

[As amended by Finance Act, 2019]

No filing or Late filing of TDS returns or TDS statement under Income Tax Act shall be liable for 2 penal consequence

1.Fee for late filing U/s 234E and

2. Penalty for late filing or Non filing of TDS statement U/s 271H.

Before understanding the penalty provisions for failure to furnish the statement of Tax Deducted at Source or statement of Tax Collected as Source (i.e. commonly known as TDS/TCS return) we shall first have a look at the few basic duties of a person liable to deduct/collect tax at source and due dates for filing of TDS/TCS return.

Refer also Interest for Delay in Payment of TDS/ TCS and Non Payment of Income Tax Demanded (FA 2019)

Duties of the person liable to deduct/collect tax at source

He shall obtain Tax Deduction Account Number or Tax Collection Account Number (as the case may be) and quote the same in all the documents pertaining to TDS/TCS.
He shall deduct/collect the tax at source at the applicable rate.
He shall pay the tax deducted/collected by him to the credit of the Government.
He shall file the periodic TDS/TCS statements, i.e., TDS/TCS return.
He shall issue the TDS/TCS certificate in respect of tax deducted/collected by him.

Due Dates for filing of TDS/TCS return

The due dates for filing of TDS/TCS return for different quarters of Financial Year 2019-20 are as follows:

Financial Year 2019-20

Quarter ending	Due date for filing of TDS return (Both for Government and other Deductor)	Due date for filing of TCS return
30^th June 2019	31^st July 2019	15^th July 2019
30^th September 2019	31^st October 2019	15^th October 2019
31^st December 2019	31^st January 2020	15^th January 2020
31^st March 2020	31^th May 2020	15^th May 2020

Basic provisions

A person who fails to file the TDS/TCS return or does not file the TDS/TCS return by the due dates prescribed in this regard has to pay late filing fees as provided under section 234E and apart from late filing fees he shall be liable to pay penalty under section 271H. In this part you can gain knowledge about the provisions of section 234E and section 271H.

Late filing fees under section 234E

As per section 234E, where a person fails to file the TDS/TCS return on or before the due date prescribed in this regard, then he shall be liable to pay, by way of fee, a sum of Rs. 200 for every day during which the failure continues. The amount of late fees shall not exceed the amount of TDS.

TDS/TCS return cannot be filed without payment of late filing fees as discussed above. In other words, the late filing fees shall be deposited before filing the TDS return. It should be noted that Rs. 200 per day is not penalty but it is a late filing fee.

Illustration

The quarterly statement of TDS i.e. TDS return for the first quarter of the year 2018-19 is filed by Mr. Kapoor on 4-4-2019. Tax deducted at source during the quarter amounted to Rs. 8,40,000. What will be the amount of late filing fees to be paid by him for delay in filing the TDS return?

The due date for filing of TDS return for the first quarter of the year 2018-19 i.e. April 2018 to June 2018 is 31st July, 2018. The return is filed on 4th April, 2019, thus there is a delay of 247 days as computed below:

*Particulars*	*Days*
August 2018	31
September 2018	30
October 2018	31
November 2018	30
December 2018	31
January 2019	31
February 2019	28
March 2019	31
April 2019	4
*Total*	247

From the above computation it can be observed that there is a delay of 247 days. Late filing fees under section 234E will be charged at Rs. 200 per day, thus for 247 days the late filing fees will come to Rs. 49,400.

Illustration

The quarterly statement of TDS i.e. TDS return for the second quarter of the year 201819 is filed by Essem Ltd. on 4-4-2019. Tax deducted at source during the quarter amounted to Rs. 8,400. What will be the amount of late filing fees to be paid by the company for delay in filing the TDS return?

The due date of filing the TDS return for the second quarter of the year 2018-19 i.e. July 2018 to September 2018 is 31th October, 2018. The return is filed on 4th April, 2019, thus there is a delay of 155 days as computed below:

*Particulars*	*Days*
November 2018	30
December 2018	31
January 2019	31
February 2019	28
March 2019	31
April 2019	4
Total	155

From the above computation it can be observed that there is a delay of 155 days. Late filing fees under section 234E will be charged at Rs. 200 per day, thus for 155 days the late filing fees will come to Rs. 31,000. However, the late filing fees cannot exceed the amount of tax deducted at source. TDS for the quarter is Rs. 8,400 and hence late filing fees shall beRs. 8,400.

Illustration

The quarterly statement of tax collected at source i.e. TCS return for the first quarter of the year 2018-19 is filed by Mr. Krunal on 4-8-2018. Tax collected at source during the quarter amounted to Rs. 84,000. What will be the amount of late filing fees to be paid by him for delay in filing the TCS return?

In case of Non-Government deductor, the due date of filing the TCS return for the first quarter of the year 2018-19 i.e. April 2018 to June 2018 is 15th July, 2018. The return is filed on 4th August, 2018, thus there is a delay of 20 days as computed below:

*Particulars*	*Days*
July 2018	16
August 2018	4
Total	20

From the above computation it can be observed that there is a delay of 20 days. Late filing fees under section 234E will be charged at Rs. 200 per day, thus for 20 days the late filing fees will come to Rs. 4,000.

Illustration

The quarterly statement of tax collected at source i.e. TCS return for the second quarter of the year 2018-19 is filed by Mr. Raja on 4-12-2018. Tax collected at source during the quarter amounted to Rs. 2,520. What will be the amount of late filing fees to be paid by him for delay in filing the TCS return?

The due date of filing the TCS return for the second quarter of the year 2018-19 i.e. July 2018 to September 2018 is 15th October, 2018. The return is filed on 4th December, 2018, thus there is a delay of 50 days as computed below:

*Particulars*	*Days*
October 2018	16
November 2018	30
December 2018	4
Total	50

From the above computation it can be observed that there is a delay of 50 days. Late filing fees under section 234E will be charged at Rs. 200 per day, thus for 50 days the late filing fees will come to Rs. 10,000. However, the late filing fees cannot exceed the amount of tax collected at source. TCS during the quarter amounts to Rs. 2,520 and hence, late filing fees shall be Rs. 2,520.

Illustration

The quarterly statement of Tax deducted at source i.e. TDS return for the last quarter of the year 2018-19 is not filed by Mr. Raj till 31st May, 2019. Can he file the TDS return of last quarter of the year 2018-19 after 31st May, 2019 without payment of any late filing fees?

The due date of filing the TDS return for the last quarter of the year 2018-19 i.e. January 2019 to March 2019 is 31st May, 2019. The return is not filed till 31st May, 2019 and hence late filing fees under section 234E of Rs. 200 per day of default will be levied. TDS return cannot be filed without payment of late filing fees as discussed above. In other words, the late filing fees shall be deposited before filing the TDS return. Hence, in this case, Mr. Raj cannot file the TDS return without payment of late filing fees of Rs. 200 per day.

Computation of fee under Section 234E at the time of processing of TDS/TCS statement

Section 200A of the Income-tax Act provides for processing of TDS statements for determining the amount payable or refundable to the deductor. Provisions of Section 200A has been amended by the the Finance Act, 2015 so as to enable computation of fee payable under under section 234E at the time of processing of TDS statements.

As the mechanism of TCS statement is similar to TDS statement, a new section 206CB has been inserted by Finance Act, 2015 to provide for processing of TCS statements on the lines of existing provisions for processing of TDS statement contained in section 200A of the Income-Tax Act. The new section 206CB also provides for mechanism for computation of fee payable under section 234E at the time of processing of TCS statement.

Penalty under section 271H

As per section 271H, where a person fails to file the statement of tax deducted/collect at source i.e. TDS/TCS return on or before the due dates prescribed in this regard, then assessing officer may direct such person to pay penalty under section 271H. Minimum penalty can be levied of Rs. 10,000 which can go upto Rs. 1,00,000. Penalty under section 271H will be in addition to late filing fees prescribed under section 234E.

Apart from delay in filing of TDS/TCS return, section 271H also covers cases of filing incorrect TDS/TCS return. Penalty under section 271H can also be levied if the deductor/collector files an incorrect TDS/TCS return. In other words, minimum penalty of Rs. 10,000 and maximum penalty of upto Rs. 1,00,000 can be levied if the deductor/collector files an incorrect TDS/TCS return.

No penalty will be levied under section 271H for the failure to file the TDS/TCS return, if the person proves that after paying tax deducted/collected by him, along with the late-filing fee and interest (if any), to the credit of the Central Government, he had filed the TDS/TCS return before the expiry of a period of one year from the due date of filing the TDS/TCS return. In other words, no penalty under section 271H will be levied in case of delay in filing the TDS/TCS return if following conditions are satisfied:

The tax deducted/collected at source is paid to the credit of the Government.
Late filing fees and interest (if any) is paid to the credit of the Government.
The TDS/TCD return is filed before the expiry of a period of one year from the due date specified in this behalf.

It should be noted that the above relaxation is applicable only in case of penalty levied under section 271H for delay in filing the TDS/TCS return and not in case of filing incorrect TDS/TCS statement.

Apart from above relaxation, in following two cases the taxpayer can get relief from penalty under section 271H:

Under section 273A(4) the Principal Commissioner of Income-tax or Commissioner of Income-tax has power to waive or reduce the penalty levied under the Income-tax Act. Penalty can be waived or reduced by the Commissioner of Income-tax if the conditions specified in section 273A(4) in this regard are satisfied.
Apart from shelter of section 273A(4), section 273B also provides immunityfrom penalty in genuine cases. As per section 273B, penalty under section 271H will not be levied if the taxpayer proves that there was a reasonable cause for failure.

Illustration

The quarterly statement of tax deducted at source i.e. TDS return for the first quarter of the year 2018-19 is filed by Mr. Krunal on 4-4-2019. Tax deducted at source during the quarter amounted to Rs. 84,000. Before filing the TDS return he has paid the TDS, interest and late filing fees to the credit of the Government. Will he be liable to penalty under section 271H for delay in filing the TDS return?

Penalty under section 271H can be levied for delay in filing the TDS return. In this case, the due date of filing the TDS return for the first quarter of the year 2018-19 i.e. April 2018 to June 2018 is 31st July, 2018. The return is filed on 4th April, 2019, thus there is a delay of 247 days (i.e. less than a year). As per section 271H(3) no penalty under section 271H will be levied in case of delay in filing the TDS/TCS return if following conditions are satisfied :

The tax deducted/collected at source is paid to the credit of the Government.
Late filing fees and interest (if any) is paid to the credit of the Government.
The TDS/TCD return is filed before the expiry of a period of one year from the due date specified in this behalf.

In the present case, all the aforesaid conditions are satisfied because the delay in filing the TDS return is of less than 1 year and interest and late filing fees are paid before filing the TDS return, thus penalty under section 271H will not be levied.

The same provision as discussed above will apply in case of delay in filing the statement of tax collected at source i.e. TCS return.

Illustration

The quarterly statement of tax deducted at source i.e. TDS return for the first quarter of the year 2018-19 is filed by Mr. Rahul on 20-8-2019. Tax deducted at source during the quarter amounted to Rs. 1,84,000. Before filing the TDS return he has paid the TDS, interest and late filing fees to the credit of the Government. Will he be liable to penalty under section 271H for delay in filing the TDS return?

Penalty under section 271H can be levied for delay in filing the TDS return. The due date of filing the TDS return for the first quarter of the year 2018-19 i.e. April 2018 to June 2018 is 31st July, 2018. The return is filed on 20th Aug., 2019, thus there is a delay of 385 days (i.e. more than a year). As per section 271H(3) no penalty under section 271H will be levied in case of delay in filing the TDS/TCS return if following conditions are satisfied :

The tax deducted/collected at source is paid to the credit of the Government.
Late filing fees and interest (if any) is paid to the credit of the Government.
The TDS/TCD return is filed before the expiry of a period of one year from the due date specified in this behalf.

In the above case, the delay is of more than 1 year and hence the above immunity will not be available. Thus, the Assessing Officer can levy penalty under section 271H. Minimum penalty of Rs. 10,000 and maximum penalty of Rs. 1,00,000 can be levied by the Assessing Officer. However, Mr. Rahul has following two remedies to get relief from penalty:

He can apply to Principal Commissioner of Income-tax or Commissioner of Income-tax under section 273A(4) to seek relief from penalty.
He can seek relief under section 273B by proving that there was a reasonable cause for failure.

The same provision as discussed above will apply in case of delay in filing the statement of tax collected at source i.e. TCS return.

Illustration

The quarterly statement of tax deducted at source i.e. TDS return for the first quarter of the year 2018-19 is filed by Mr. Sharma on 10-7-2018. The particulars of the tax deducted at source as mentioned in TDS return are incorrect. Will he be liable to pay penalty under section 271H for delay in filing the TDS return and for furnishing the inaccurate particulars in the return?

Penalty under section 271H can be levied for following defaults:

(1) Delay in filing the TDS/TCS quarterly statement i.e. TDS/TCS quarterly return.

(2) Furnishing incorrect TDS/TCS quarterly statement i.e. TDS/TCS quarterly return.

In the present case Mr. Sharma has filed an incorrect TDS return and hence he shall be held liable to pay penalty under section 271H. Minimum penalty of Rs. 10,000 and maximum penalty of upto Rs. 1,00,000 can be levied. Mr. Sharma will have no remedy under Section 271H(3) to claim relief from penalty for furnishing of inaccurate particulars in the return. However, the taxpayer can seek relief in the following way:

He can apply to Principal Commissioner of Income-tax or Commissioner of Income-tax under section 273A(4) to grant relief from penalty.
He can seek relief under section 273B by proving that there was a reasonable cause for failure.

The same provision as discussed above will apply in case of delay in filing the statement of tax collected at source i.e. TCS return.

(Republished with amendments)

Income Tax penalty under New Section 270A Income Tax Act

Analysis with Examples section 270A of Income Tax -200% Penalty

Income Tax Penalty, Section 234E income tax, Section 271H income tax, TDS income tax ,tds late payment penalty ,tds late payment fees,tds late payment fees section , how to pay penalty for late filing of tds return online, tds return due date for fy 2019-20 ,tds return filing due date for AY 2020-21

tds payment due date for fy 2019-20 ,late filing of tds return u/s 234e

Section 234E of Income Tax Act -Fees for Default in TDS/TCS statements

CA Satbir Singh — Tue, 18 Oct 2016 12:36:49 +0000

Section 234E of Income Tax Act

Inserted by the Finance Act, 2012, w.e.f. 1-7-2012.

Section 234 prescribe fees for default in furnishing TDS/TCS statements.

Section 234E :- Fee for default in furnishing statements.

234E. (1) Without prejudice to the provisions of the Act, where a person fails to deliver or cause to be delivered a statement within the time prescribed in sub-section (3) of section 200 or the proviso to sub-section (3) of section 206C, he shall be liable to pay, by way of fee, a sum of two hundred rupees for every day during which the failure continues.

(2) The amount of fee referred to in sub-section (1) shall not exceed the amount of tax deductible or collectible, as the case may be.

(3) The amount of fee referred to in sub-section (1) shall be paid before delivering or causing to be delivered a statement in accordance with sub-section (3) of section 200 or the proviso to sub-section (3) of section 206C.

(4) The provisions of this section shall apply to a statement referred to in sub-section (3) of section 200 or the proviso to sub-section (3) ofsection 206C which is to be delivered or caused to be delivered for tax deducted at source or tax collected at source, as the case may be, on or after the 1st day of July, 2012.]

Judgments on Section 234E of Income Tax Act

Provisions of section 234E are neither ultra vires nor unconstitutional – Dr. Amrit Lal Mangal v. Union of India [2015] (Punj. & Har.).

Absence of any provision for condonation of delay and appeal does not make imposition of late fees under section 243E ultra vires –Dundlod Shikshan Sansthan v. Union of India [2015] (Raj.).

Section 234 levies a fee to regularize said late filing which is a fixed charge for extra service which department has to provide due to late filing of TDS statements and is not in guise of a tax nor is it onerous. Thus, section 234E does not violate any provision of Constitution and is therefore intra vires – Rashmikant Kundalia v. Union of India [2015] (Bom.).

Fee levied under section 234E to regularize late filing of TDS statements could not be held to be ultra vires of Constitution – Lakshminirman Bangalore (P.) Ltd. v. Dy. CIT [2015] (Kar.).

Read

Section 234E adjustment beyond scope of permissible adjustments contemplated under section 200A

CA Satbir Singh — Mon, 18 Jan 2016 11:11:37 +0000

Whether so far as period prior to 1st June 2015 is concerned, fees under section 234 E of the Income Tax Act 1961 (hereinafter referred to as ‘the Act’), in respect of defaults in furnishing TDS statements, could be levied in intimation under section 200A of the Act ?

HELD ; NO

IN THE ITAT AMRITSAR BENCH

Sibia Health Care (P.) Ltd.

Deputy Commissioner of Income-tax (TDS), Ghaziabad

PRAMOD KUMAR, ACCOUNTANT MEMBER
AND A.D. JAIN, JUDICIAL MEMBER

IT APPEAL NO. 95 (ASR.) OF 2015
[ASSESSMENT YEAR 2013-14]

JUNE 9, 2015

Ashwani Kalia for the Appellant. Tarsem Lal for the Respondent.

ORDER

Pramod Kumar, Accountant Member – By way of this appeal, the assessee has called into question correctness of the order dated 13th October 2014 passed by the learned CIT(A) upholding levy of fees, under section 234E of the Income Tax Act, 1961, on the assessee and by way of intimation dated 11th January 2014 issued under section 200A in respect of processing of TDS statements the second quarter of the financial year 2012-13. The appeal is time barred by 62 days but the assessee has filed a petition seeking condonation of this delay. Having perused the condonation petition and having rival contentions on the same, we are inclined to condone the delay and proceed to take up the matter on merits. Delay condoned.

2. During the course of this hearing, learned representatives were asked to address us on the question as to whether or not, so far as period prior to 1st June 2015 is concerned, fees under section 234 E of the Income Tax Act 1961 (hereinafter referred to as ‘the Act’), in respect of defaults in furnishing TDS statements, could be levied in intimation under section 200A of the Act. It is on this short issue, and for the reasons we will set out in a short while, we propose to decide these appeals.

3. To adjudicate on these appeals, only a few material facts need to be taken note of. It is a case in which there was admittedly a delay in filing of the TDS returns. In the course of the processing of the TDS return, the Assessing Officer (TDS) raised a demand, by way of an intimation dated 9th September 2013 issued under section 200A of the Act, for levy of fees under section 234E for delayed filing of TDS statement. Aggrieved by this levy of fees, assessee carried the matter in appeal before the CIT(A) but without any success. The assessee is not satisfied and is in further appeal before us.

4. We have heard the rival contentions, perused the material on record and duly considered facts of the case in the light of the applicable legal position. In addition to his argument on the merits, learned counsel has also invited our attention to the reports about the decisions of various Hon’ble High Courts, including Hon’ble Kerala High Court, in the case of Narath Mapila LP School v. Union of India [WP (C) No. 31498/2013(J)], Hon’ble Karnataka High Court in the case of Adithya Bizor P Solutions v. Union of India [WP Nos. 6918-6938/2014(T-IT)], Hon’ble Rajasthan High Court in the case of Om Prakash Dhoot v. Union of India [WP No. 1981 of 2014] and of Hon’ble Bombay High Court in the case of Rashmikant Kundalia v. Union of India [2015] 229 Taxman 596, granting stay on the demands raised in respect of fees under section 234E. The full text of these decisions were not produced before us. However, as admittedly there are no orders from the Hon’ble Courts above retraining us from our adjudication on merits in respect of the issues in this appeal, and as, in our humble understanding, this appeal requires adjudication on a very short legal issue, within a narrow compass of material facts, we are proceeding to dispose of this appeal on merits.

5. We may produce, for ready reference, section 234E of the Act, which was inserted by the Finance Act 2012 and was brought into effect from 1st July 2012. This statutory provision is as follows:

234E. Fee for defaults in furnishing statements

(1)		Without prejudice to the provisions of the Act, where a person fails to deliver or cause to be delivered a statement within the time prescribed in sub-section (3) of section 200 or the proviso to sub-section (3) of section 206C, he shall be liable to pay, by way of fee, a sum of two hundred rupees for every day during which the failure continues.
(2)		The amount of fee referred to in sub-section (1) shall not exceed the amount of tax deductible or collectible, as the case may be.
(3)		The amount of fee referred to in sub-section (1) shall be paid before delivering or causing to be delivered a statement in accordance with sub-section (3) of section 200 or the proviso to sub-section (3) of section 206C.
(4)		The provisions of this section shall apply to a statement referred to in sub-section (3) of section 200 or the proviso to sub-section (3) of section 206C which is to be delivered or caused to be delivered for tax deducted at source or tax collected at source, as the case may be, on or after the 1st day of July, 2012

6. We may also reproduce the Section 200A which was inserted by the Finance Act 2009 with effect from 1st April 2010. This statutory provision, as it stood at the relevant point of time, was as follows:

200A: Processing of statements of tax deducted at source

(1) Where a statement of tax deduction at source, or a correction statement, has been made by a person deducting any sum (hereafter referred to in this section as deductor) under section 200, such statement shall be processed in the following manner, namely:—

(a) the sums deductible under this Chapter shall be computed after making the following adjustments, namely:—

(i)		any arithmetical error in the statement; or
(ii)		an incorrect claim, apparent from any information in the statement;

(b) the interest, if any, shall be computed on the basis of the sums deductible as computed in the statement;

(c) the sum payable by, or the amount of refund due to, the deductor shall be determined after adjustment of amount computed under clause (b) against any amount paid under section 200 and section 201, and any amount paid otherwise by way of tax or interest;

(d) an intimation shall be prepared or generated and sent to the deductor specifying the sum determined to be payable by, or the amount of refund due to, him under clause (c); and

(e) the amount of refund due to the deductor in pursuance of the determination under clause (c) shall be granted to the deductor:

Provided that no intimation under this sub-section shall be sent after the expiry of one year from the end of the financial year in which the statement is filed.

Explanation : For the purposes of this sub-section, “an incorrect claim apparent from any information in the statement” shall mean a claim, on the basis of an entry, in the statement—

(i)		of an item, which is inconsistent with another entry of the same or some other item in such statement;
(ii)		in respect of rate of deduction of tax at source, where such rate is not in accordance with the provisions of this Act;

(2) For the purposes of processing of statements under sub-section (1), the Board may make a scheme for centralised processing of statements of tax deducted at source to expeditiously determine the tax payable by, or the refund due to, the deductor as required under the said sub- section.

7. By way of Finance Act 2015, and with effect from 1st June 2015, there is an amendment in Section 200A and this amendment, as stated in the Finance Act 2015, is as follows:

In section 200A of the Income-tax Act, in sub-section (1), for clauses (c) to (e), the following clauses shall be substituted with effect from the 1st day of June, 2015, namely:—

“(c) the fee, if any, shall be computed in accordance with the provisions of section 234E;

(d) the sum payable by, or the amount of refund due to, the deductor shall be determined after adjustment of the amount computed under clause (b) and clause (c) against any amount paid under section 200 or section 201 or section 234E and any amount paid otherwise by way of tax or interest or fee;

(e) an intimation shall be prepared or generated and sent to the deductor specifying the sum determined to be payable by, or the amount of refund due to, him under clause (d); and

(f) the amount of refund due to the deductor in pursuance of the determination under clause (d) shall be granted to the deductor.”

8. In effect thus, post 1st June 2015, in the course of processing of a TDS statement and issuance of intimation under section 200A in respect thereof, an adjustment could also be made in respect of the “fee, if any, shall be computed in accordance with the provisions of section 234E”. There is no dispute that what is impugned in appeal before us is the intimation under section 200A of the Act, as stated in so many words in the impugned intimation itself, and, as the law stood, prior to 1st June 2015, there was no enabling provision therein for raising a demand in respect of levy of fees under section 234E. While examining the correctness of the intimation under section 200A, we have to be guided by the limited mandate of Section 200A, which, at the relevant point of time, permitted computation of amount recoverable from, or payable to, the tax deductor after making the following adjustments:

(a)		after making adjustment on account of “arithmetical errors” and “incorrect claims apparent from any information in he statement” — Section 200A(1)(a)
(b)		after making adjustment for ‘interest, if any, computed on the basis of sums deductible as computed in the statement” — Section 200A(1)(b)

9. No other adjustments in the amount refundable to, or recoverable from, the tax deductor, were permissible in accordance with the law as it existed at that point of time.

10. In view of the above discussions, in our considered view, the adjustment in respect of levy of fees under section 234E was indeed beyond the scope of permissible adjustments contemplated under section 200A. This intimation is an appealable order under section 246A(a), and, therefore, the CIT(A) ought to have examined legality of the adjustment made under this intimation in the light of the scope of the section 200A. Learned CIT(A) has not done so. He has justified the levy of fees on the basis of the provisions of Section 234E. That is not the issue here. The issue is whether such a levy could be effected in the course of intimation under section 200A. The answer is clearly in negative. No other provision enabling a demand in respect of this levy has been pointed out to us and it is thus an admitted position that in the absence of the enabling provision under section 200A, no such levy could be effected. As intimation under section 200A, raising a demand or directing a refund to the tax deductor, can only be passed within one year from the end of the financial year within which the related TDS statement is filed, and as the related TDS statement was filed on 19th February 2014, such a levy could only have been made at best within 31st March 2015. That time has already elapsed and the defect is thus not curable even at this stage. In view of these discussions, as also bearing in mind entirety of the case, the impugned levy of fees under section 234E is unsustainable in law. We, therefore, uphold the grievance of the assessee and delete the impugned levy of fee under section 234E of the Act. The assessee gets the relief accordingly.

11. In the result, the appeal is allowed.