SHRI RAMESH A MARAND,AHMEDABAD vs. ACIT, CIRCLE-7(1), AHMEDABAD

19.09.2019 सुनवाईक�तारीख/ Date of hearing: 19.09.2019 उ�ोषणाक�तारीख/Pronouncement on आदेश /O R D E R

PER O. P. MEENA,AM:

Ramesh A. Marand v. ACIT-7(1) Ahmedabad /I.T.A.No. 2887/AHD/2017/A.Y. 14-15 Pg 2

Meanwhile, the AO directly collected Form No. 16 from the employer i.e. Sparsh Technologies. The AO found that Form No. 16 received from employer shows the allowance to the extent of Rs. 18,661 only whereas the assessee has claimed exempt income of Rs. 10,48,680 as allowance in his Form No. 16. Hence, the AO held the Form No. 16 submitted by the assessee, which is obtained from employees of the employer is false.

Therefore, the AO made addition of difference of Rs. 10,30,019 [ 10.48.680- 18,661] as allowances claimed by the assessee were not found supported by any evidence. The AO further found that as per information received from employer, the gross salary was shown at Rs. 87,77,543 whereas the assessee has shown gross salary at Rs. 86,57,482 in computation of income. Thus, there was difference of Rs. 1,20,061. In his reply, the appellant submitted that this amount is reflected in Form No.26AS and in Form No. 16 Part –A.

Ramesh A. Marand v. ACIT-7(1) Ahmedabad /I.T.A.No. 2887/AHD/2017/A.Y. 14-15 Pg 3 Since, According to the AO, the Form No. 16 was false, hence, the amount reflected in Form No. 16 was added to total income. 5. Being, aggrieved, the assessee filed an appeal before the Ld. CIT (A).

The assessee has filed copy of bank statement showing the amount of salary received and comparison with amount of salary shown by his employer. It was further claimed that there was dispute between him and his employer; therefore, the employer did not provide Form No. 16 to the assessee. It was further submitted that the reason for deduction of TDS more than 10 time during last two months’ salary was not provided. Further, the salary credited in his bank account, as shown by the assessee is not tallied, and there is vast difference. The pattern of tax deduction by the employer in the initial months as compared to last two months give rise to possibility that employer would have considered exemption claimed by the assessee while estimation of salary for the purpose of section 192 of the Act and accordingly, estimated lower salary for the purpose of tax deduction under section 192 of the Act. It is because of resignation of the assessee from the company, the employer with a view to harass the appellant by deducting more tax and not providing the Form No. 16 and thereafter, providing different Form No. 16 in response to notice under section 133(6) of the Act.

However, the CIT (A) observed that the AO noted discrepancies in Form No. 16 submitted by the assessee and provided by the employer and the Ramesh A. Marand v. ACIT-7(1) Ahmedabad /I.T.A.No. 2887/AHD/2017/A.Y. 14-15 Pg 4 assessee has claimed exemption under section 10 amounting to Rs. 10,48,680 for which no reasons are explained. Considering these facts, the action of the AO was confirmed.

The learned counsel for the assessee submitted that there was dispute between the assessee and his employer therefore; the assessee has resigned from the service. The assessee has obtained Form No. 16 through house staff working in the employee company as the employer has denied giving Form No. 16 to the assessee. The AO has also procured vide notice under section 133(6) from employer. The assessee has given false Form No. 16.

The learned counsel for the assessee referred his submissions dated 05.10.2017 filed before CIT (A) and placed at Paper Book Page No. 29 to 34.

It was submitted that the AO should have been more objective in reading the reply of the employer wherein employer has mentioned that individual cheques transfer details are not traceable in the bank statement. The employer may be true but how much amount month wise transferred in the bank account of the assessee can be traceable from the payroll maintained by the employer. The employer being the technology firm expected to have electronic payroll since it makes payment of salary to employees electronically. Thus, the employer for some reason decided to keep silence on the month-wise payments to the assessee and furnished such tricky reply Ramesh A. Marand v. ACIT-7(1) Ahmedabad /I.T.A.No. 2887/AHD/2017/A.Y. 14-15 Pg 5 in response to notice under section 133(6) of the Act. The Ld.AO without affording opportunity of cross-examination of the employer has ignored the vital facts hence; the addition so made is not sustainable in law and on facts. With regard to disallowance of Rs. 1,20,061, it was contended that difference is due to deduction claimed under chapter VIA of the Act by the assessee. It was further submitted that the amount shown in Form No. 16 by the employer does not match with Form No.26AS and therefore, the AO has grossly erred in making such addition. The learned counsel for the assessee filed comparison date wise chart of salary payment and TDS deducted and amount of salary as received in his HDFC bank account. It was submitted that as per employer total amount paid comes to Rs. 86,57,482 on which TDS of Rs. 25,00,062 was made and net salary of Rs. 61,57,420 was received by the assessee. As against, this the bank statement of HDFC bank account of the assessee shows credit of salary receipt at Rs. 52,62,881. If TDS of Rs. 25,00,062 is added then it comes to Rs. 77,62,420. The salary receipts are supported by bank statement of HDFC. It was pointed out that the employer has debited salary of Rs. 29,12,200 as on 12.11.2013 whereas the bank account of the assessee shows receipt of salary at Rs. 14,20,297.

Similarly, the credit of salary on 27.12.2013 is at Rs. 9,67,400 and same is reflected in bank account of the assessee. However, on various dates there Ramesh A. Marand v. ACIT-7(1) Ahmedabad /I.T.A.No. 2887/AHD/2017/A.Y. 14-15 Pg 6 is mismatch of salary credit by the employer and receipt credited in bank account of the assessee. Therefore, this needs reconciliation with employer. 7. Per contra, the ld. Sr. D.R. relied on the orders of lower authorities.