Bombay HC - Sec 234E fee constitutionally valid
CA MANJUNATH R S
Dear All,
New judgement From Bombay High Court - 234E
Levy of mandatory fee for delayed filing of TDS return & Sec 234E is constitutionally valid; Delay in filing TDS returns has cascading effect and IT Department cannot process deductee's tax status until TDS return is filed by deductor;
Delay in filing TDS return results in additional burden upon department due to deductor's fault, hence levy of fee u/s 234E is to compensate for additional work burden forced upon the Department ; HC observes that "Section 234E of the Act is not punitive in nature but a fee which is a fixed charge for the extra service which the Department has to provide due to the late filing of the TDS statements";
TDS return is regularised by paying fee u/s 234E, and is a privilege and special service provided to deductor by allowing him to submit TDS return beyond due date; HC rejects petitioner's argument that fee u/s 234E is collected in the guise of tax; Absence of "right to appeal" against Sec 234E fee cannot make levy & section invalid ;
HC says " It must be noted that a right of appeal is not a matter of right but is a creature of the statute, and if the Legislature deems it fit not to provide a remedy of appeal, so be it"; Statute relating to economic activities should be viewed with greater latitude than laws touching civil rights : Bombay HC TS-44-HC-2015(BOM
The ruling was delivered by Chief Justice Mohit Shah and Justice B. P. Colabawalla.
Additional Solicitor General Anil Singh alongwith Advocates A.R. Malhotra and N.A. Kazi represented the Revenue.Advocates B.L. Gandhi and K.C. Pandey argued for the Petitioners.
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