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Income Tax Appellate Tribunal, DELHI BENCH ‘H’, NEW DELHI
Before: Sh. C. N. PrasadDr. B. R. R. Kumar
Per Dr. B. R. R. Kumar, Accountant Member:
The present appeal has been filed by the assessee against the order of National Faceless Appeal Centre (NFAC) dated 14.09.2021.
Following grounds have been raised by the assessee:
“1. The order of the Learned Commissioner of Income Tax (Appeals) is wrong and erroneous both in fact and law and is therefore bad in law.
2. The Learned Commissioner of Income Tax (Appeals) has erred in fact and in law by confirming the action of the Learned Income Tax Officer in not giving credit for TDS amounting to Rs.2,31,500/- deducted on sale of property.”
2 Subhash Bana 3. The assessee is and individual and a Salaried Employee, deriving income from salary, house property and income under the head ‘Other Sources’. The assessee filed return of income on 29.07.2016 declaring taxable income of Rs. 99,02,280/- and a loss to be carried forward of Rs. 98,68,866/-.
Intimation u/s 143(1) of the Income Tax Act, 1961 was received on accepting the returned income with carry forward of loss. The tax liability as per return was calculated at Rs. 28,84,499/-, which has also been accepted in the intimation u/s 143(1) of the Act dated 14.11.2016. However, Tax Deducted at Source (TDS) claimed at Rs.27,46,313/- had been reduced to Rs. 24,25,465/- by short credit of TDS of Rs. 3,20,848/-.
Rectification was requested on 19.02.2018 before the Assessing Officer and order u/s 154 was made on 05.05.2018 wherein the tax credit was increased to Rs. 25,13,013/-. The short credit still worked out to Rs. 2,33,300/-. This short credit includes Rs. 2,31,500/- TDS on sale of property u/s 194IA of the Act.
An application dated 13.6.2018 u/s 154 for rectification was also made before the Jurisdictional Assessing Officer submitted on 15.6.2018. No order or communication has been received from Jurisdictional Assessing Officer.
The short TDS relates to sale of a property by the Assessee, being residential apartment bearing no. A-112, 11th Floor, Tower A along with two covered car parking spaces bearing no. 232 & 235 in the upper basement at “Raheja Atlantis”, Sector 31-32A, Gurgaon, on 10.12.2015.
The sale was affected for a total consideration of Rs. 2,31,50,000/- and the entire payment was received by Demand Draft and RTGSs all dated 10.12.2015 excluding TDS amounting to Rs.2,31,500/- which was deducted by the buyer(Vendee) from the total sale consideration. These facts are clearly evidenced in the sale deed dated 10.12.2015.
No credit for the aforesaid deduction has been allowed to the Assessee.
The Assessee again made a request for rectification on 27.01.2021 online on the e-filing portal of the Income Tax Department which has been decided by order dated 19.02.2021 u/s 154 of the Act, rejecting the rectification application.
The sale of property was made to Umesh Kathuria with registered PAN / AAIPK8145J. The TDS deducted amounting to Rs. 2,31,500/- was deposited by the Vendee, Umesh Khaturia on 14.12.2015. This was clearly reflected in Form 26AS for the year however later it was reduced to NIL by adjustment and the date of booking of both the entries is stated as 24.12.2015.
After adjusting, it is noticed that the credit now appears in Form 26AS for the AY 2014-15.
As per settled law, the credit of TDS is to be allowed in the year in which the income is returned relevant to the TDS or in which the actual transaction has taken place. In the present case, the transaction took place on 10.12.2015, which relates to Previous Year 2015-16 (relevant to AY 2016-17). Even, the TDS
4 Subhash Bana was deducted on 10.12.2015 in the FY 2015-16 and deposited on 14.12.2015 i.e. in that year FY 2015-16 (AY 2016-17). The relevant return of TDS in Form 26QB was also submitted on 24.12.2015 (Date of Booking in Form 26AS) in the same FY 2015-16. The Assessee had rightly claimed the TDS in the AY 2016-17 relevant to FY 2015-16 in which the transaction took place.
The Assessee having sold two properties during the year there was Long Term Capital Loss and the same has been carried forward. Due to loss, the Assessee is entitled to refund of TDS over and above the tax on assessed income.
The ld. CIT(A) has confirmed non-credit of TDS with same reasons as the Assessing Officer, ignoring all facts that the TDS has been deducted and deposited, however, the credit originally appeared in the AY 2016-17 and later shifted to AY 2014-15. The Deductor has not corrected the TDS returns submitted by him, which could have been done and should have been done by the AO or the matter should have been referred to Jurisdictional Assessing Officer to call the Deductor and direct him to correct the TDS return.
The ld. CIT(A) has not considered the detailed submissions of the Assessee wherein it was clearly established that amount of TDS has been deducted, wrongly shifted to AY 2014-15, when the transaction related to sale of property made in FY 2015-16 (AY 2016-17). The entire payment was received in the FY 2015- 16 and the TDS was deducted as well in FY 2015- 16, and the Deductor deposited the TDS in that year.
5 Subhash Bana 17. The challan counterfoil dated 14.12.2015 issued by the bank also shows that the TDS deposited is for AY 2016-17.
The TDS return in Form 26QB as downloaded also shows that the return is for the AY 2016-17 (FY 2015-16) however the date of payment and date of deduction are erroneously and wrongly mentioned as 01.06.2013 instead of 10.12.2015, the date of transaction on which the payments were made by the Deductor through RTGS on the same day i.e. 10.12.2015 and the sale deed also registered on the said same date that is 10.12.2015.
The Assessee continued to follow up with the deductor of tax to submit correction statement for correcting the year of the TDS for due appearing in the relevant and applicable Assessment Year, i.e. 2016-17. Due to continuous persuasion the deductor, Shri Umesh Khaturia, the rectification was done and the same now appears for the AY 2016-17. Copy of the Form 26AS showing the above TDS of Rs. 231500/- for the year 2016-17 is attached in the Paper Book.
In the meanwhile pending hearing in the present appeal, the Assessee submitted an application dated 15.02.2022 as per the Ack. No. 213052110255 dated 16.02.2022 to the Jurisdictional Assessing Officer. Till now, no action has been taken for giving credit by Assessing Officer.
A rectification request was also made to CPC, Bangalore on 12.03.2022 with Rectification Reference No. 333639100120322 for reprocessing the return. This application has been rejected the same day i.e. on 12.03.2022 without any reason. It is 6 Subhash Bana important to know from the Form 26AS downloaded on 14.02.2022 that the due credit for Rs. 2,31,500/- is appearing therein. The application for rectification as mention above in this para is dated 12.03.2022 and the order of rejection is also same i.e. on 12.03.2022, when the credit was available on the said date as evidenced from the Form 26AS downloaded on 14.02.2022. A Grievance was lodged in regard to the above rejection of rectification as per Ack. No. 7674856 on 22.08.2022 which has not been resolved and is pending.
From the entire sequence of events mentioned above, it is clear that the assessee is eligible for credit and refund of Rs.2,31,500/-. Hence, the AO is hereby directed to give credit of the TDS deducted and issue the refund of same to the assessee within 90 days from the receipt of this order. The ld. Jurisdictional PCIT shall monitor the issue of refund and see that the grievance of the assessee is redressed.
In the result, the appeal of the assessee is allowed. Order Pronounced in the Open Court on 25/11/2022.