T M INPUTS AND SERVICES PRIVATE LIMITED ,SECUNDERABAD vs. INCOME TAX OFFICER, WARD-2(4), HYDERABAD

A solitary issue raised by the assessee in this appeal is that the AO disallowed Rs. 21,760/- with reference to interest on TDS with a mention that it is not an allowable expenditure without reference to any section of IT Act under which it is allowed, while, the CIT(A) disallowed citing that even though it is mentioned in the written submissions the same is not raised as a ground of appeal.

We have considered the rival submissions and perused the material on record as well as gone through the orders of revenue authorities. The contention of the ld. AR before us is that the CIT(A) upheld the action of the AO on the ground that though the assessee has mentioned about the disallowance of Rs. 21,760/- towards interest on TDS made by the AO, failed to raise as ground of appeal. He, therefore, submitted that the issue may be remitted to the file of CIT(A) for adjudication of the issue on merits. To meet the ends of justice, we remit the issue to the file of the CIT(A) with a direction to decide the ground of disallowance on account of interest on TDS on merits and in accordance with law after providing reasonable opportunity of hearing to the assessee. The assessee is directed to substantiate its claim before the CIT(A) by way of documentary evidence. Accordingly, the ground raised by the asesssee is treated as allowed for statistical purposes.