Late Fee Already Imposed — Madras HC Holds Separate General Penalty Under Sec. 125 Cannot Be Levied for the Same Default.
Issue:
Whether the Department could impose both late fee and general penalty under Section 125 for the same default.
Rule:
Late fee is penal in nature. Following Ms. Kandan Hardware Mart v. Asstt. Commissioner (ST) (FAC), a general penalty under Section 125 cannot also be imposed after levy of late fee for the same default.
Application:
The Assesee challenged orders which imposed both late fee and general penalty. The Madras High Court followed its earlier ruling to maintain consistency and found that the general penalty could not survive once late fee had been imposed.
Conclusion:
The Court set aside the impugned orders to the extent of the general penalty, while leaving the levy of late fee undisturbed.
Impact Analysis:
The judgment prevents double penal consequences for the same default and reinforces that a general penalty under Sec. 125 cannot be additionally imposed where late fee has already been levied for that default.