ITAT: Late Fee Will be Imposed if TDS Not Filed Timely U/S 243E

Income Tax Appellate Tribunal (ITAT) of Amritsar bench, engaged via M.L. Meera (Accountant Member) and Anikesh Banerjee (Judicial Member) kept the decision of the Commissioner of Income Tax (Appeals) National Faceless Appeal Centre (NFAC) for imposing the late fee on the taxpayer on filing Tax Deduction Source (TDS) late.

The taxpayer furnished an appeal in response to the decision made by the CIT(A), (NFAC), for the assessment year 2020–21. The only issue raised by this appeal is the levy of an Rs. 30,600 late fee under section 234E of the Income Tax Act.

In this instance, the assessee’s attorney submitted a first adjournment application on September 23, 2020, claiming that the necessary data could not be gathered and produced owing to a significant hurry to file an income tax return.

The case was also postponed until 10.11.2022, taking the Assessee Representative’s (AR) request into account. The AR has re-filed an application for adjournment with the same justification.

However, taking into account a technical matter of the assessment of a penalty under Section 234E of the Income Tax Act, which was made by the Assessing Officer (AO) and affirmed by the CIT(A) in accordance with the statutory requirements.

The taxpayer said to the AO that the Covid epidemic was to blame for the delay. Additionally, it was asserted that the deadline for filing taxes was extended to December 31, 2020. The appellant argued for the cancellation of the late charge assessed with these submissions.

The time restriction for reporting 4th quarter TDS statements was merely extended up to July 31, 2020, in light of the COVID issue, the tribunal stated after hearing from the department’s attorney during the hearing.

It is undeniable that the Central Processing Center (TDS) only assessed these penalties for delays over July 31, 2020. The CIT(A) was right in rejecting the claim that she wasn’t the one who had to deduct taxes.

According to the newly introduced rules of section 200(3), everyone who deducts tax is expected to submit the TDS statement within the allotted period after paying the tax deducted to the credit of the Central Government.

The judgment affirmed the CIT(A decision, )’s which was supported by affirming the CPC(TDS findings )’s that a late charge of Rs 30,600 was properly assessed under section 234E of the Income Tax Act. As a result, the appeal was rejected by the bench.

Case Title	Reshma Devi Vs. CPC
Citation	I.T.A. No. 47/Asr/2022
Date	17.11.2022
Respondent by	Sh. Rajiv Wadhera, Sr. DR
ITAT Amritsar	Read Order