SATYA VENU GOPALA RAO KADAMATI,USA vs. INCOME TAX OFFICER, WARD-1, KAKINADA

PER OMKARESHWAR CHIDARA, ACCOUNTANT MEMBER: This appeal is filed by the Assessee against order of Learned Commissioner of Income-Tax (Appeals), ADDL/JCIT (A), Thane (hereinafter in short “Ld.CIT(A)”) dated 25.11.2025 passed under section 250 of Income Tax Act, 1961 (hereinafter in short “the Act”) for the A.Y.2024-25.

“1. The learned CIT(A) failed to appreciate that there is no variation whatsoever between the returned income and the assessed income, both being Rs.1,14,82,410/-, and that the entire tax demand has arisen solely due to denial of credit of tax deducted at source under Form 26QB.

ITA 55/VIZ/2026 SATYA VENU GOPALA RAO KADAMATI 2. The learned CIT(A) erred in law in sustaining the tax demand arising solely on account of improper filing of Form 26QB by the buyer of the appellant's property, despite the appellant having no control over such compliance and having duly discharged all obligations under the Act. 3. The learned CIT(A) erred in upholding the rectification carried out under Section 154 of the Income-tax Act, 1961, when the issue of grant of TDS credit is debatable in nature, involves appreciation of facts, and is therefore outside the limited scope of rectification. 4. The learned CIT(A) erred in confirming the action of the CPC in denying statutory TDS credit at the stage of processing under Section 143(1), which is beyond the scope of permissible prima facie adjustments contemplated under the Act. 5. The learned CIT(A) erred in disposing of the appeal without granting a personal hearing to the appellant, despite specific requests, which is in clear violation of the laid down principle of 'audi alteram partem", which is violative of the principles of natural justice and the mandate of Section 250 of the Act. 6. The impugned appellate order is cryptic, non-speaking and mechanical, having been passed without considering the detailed written submissions filed by the appellant and without recording findings as required under Section 250(6) of the Act. 7) The learned CIT(A) erred in law in failing to consider and apply the judicial precedents specifically relied upon by the appellant, including: i. Parag Keshav Bopardikar v. PCIT (Delhi High Court), wherein it has been held that non-compliance with the Faceless Appeal Scheme and denial of effective opportunity vitiates the appellate order; and ii. Naik Naik & Co. v. CIT (ITAT Mumbai), wherein it was held that Section 154 cannot be invoked to decide debatable issues or issues requiring examination of facts. The failure to consider the aforesaid case laws renders the impugned order unsustainable in law. 8. The tax effect involved in the present appeal is Rs.28,55,370/-, being the entire disputed tax demand (excluding interest) raised solely on account of denial of TDS credit, notwithstanding that the returned income and assessed income remain identical. The appeal involves jurisdictional and procedural issues and therefore falls within the exceptions to the monetary limits prescribed by the CBDT. 9. The learned CIT(A) erred in law and on facts in passing the impugned appellate order without issuing a draft appellate order to the appellant and without granting an opportunity to respond thereto, in violation of the procedure prescribed under Section 250(6B) of the Income-tax Act, 1961 read with the Faceless Appeal Scheme, 2020. The failure to issue a draft order has deprived the appellant of a meaningful opportunity to point out factual and legal errors before finalisation of the order and has vitiated the appellate proceedings. The impugned order is therefore liable to be set aside on this ground alone. 10. The learned CIT(A) erred in law in failing to adjudicate each of the grounds raised by the appellant independently, as mandated under Section 250(6) of the Income-tax Act, 1961, thereby vitiating the impugned appellate order. 11. The learned CIT(A) erred in law in confirming the action of the Centralised Processing Centre without calling for a remand report or seeking factual clarification from the processing authority, despite the appellant having raised a specific grievance regarding denial of credit of tax deducted at source attributable to default of a third party. 12. The learned CIT(A) erred in law and on facts in sustaining the tax demand raised against the appellant, in complete disregard of the statutory bar contained in Section 205 2

ITA 55/VIZ/2026 SATYA VENU GOPALA RAO KADAMATI of the Income-tax Act, 1961, which expressly prohibits recovery of tax from the assessee in respect of income on which tax has been deducted at source. 205. Bar against direct demand on assessee.— Where tax is deductible at the source under [the foregoing provisions of this Chapter], the assessee shall not be called upon to pay the tax himself to the extent to which tax has been deducted from that income. The impugned demand, having arisen solely on account of denial of credit of tax purportedly deducted under Section 194-IA (Form 26QB), is ex facie barred by Section 205 and liable to be quashed. The appellant places reliance on the following precedents: i. Yashpal Sahni v. Rekha Hajarnavis, ACIT (293 ITR 539) (Bom), ii. Hindustan Coca Cola Beverage Pvt. Ltd. v. CIT (293 /TR 226) (SC) iii. CIT v. Relcom (361 ITR 123) (Del), Wherein it has been consistently held that Section 205 creates an absolute bar against recovery of tax from the assessee where tax has been deducted or is deductible at source and the default, if any, is attributable to the deductor. 13. The learned CIT(A) erred in law in failing to consider and apply CBDT Instruction No. 5/2013 dated 08.07.2013 as well as Office Memorandum of CBDT dated 11-03-2016, which mandates that no coercive recovery shall be made from the assessee in cases where tax has been deducted at source and the default, if any, is attributable to the deductor. The impugned order, by permitting recovery from the appellant despite the default being attributable to the buyer of the property, is contrary to binding administrative instructions issued under Section 119 of the Act. The learned CIT(A) failed to appreciate that CBDT instructions issued under Section 119 of the Act are binding on all income-tax authorities, including appellate authorities, and that non-consideration of such binding instructions vitiates the impugned order. The appellate authority could not have sustained the demand in derogation of the aforesaid CBDT instructions. 14. The Appellant craves leave to add, alter, amend or withdraw any of the above grounds at the time of hearing. 15. PRAYER In view of the above facts and grounds, the Appellant respectfully prays that this Honourable Tribunal may be pleased to: i. Set aside the Order dated 25-11-2025 passed by the learned CIT (A) u/s 250 of the Act with DIN & Order Number ITBA/APL/S/250/2025-26/1082958220(1); ii. Quash the Rectification Order dated 06-01-2025 passed under Section 154 of the Act with DIN No. CPC/2425/U2/528092397 as well as the tax demand. iii. Quash the Assessment Order dated 20-10-2024 passed under Section 143(1) of the Act with DIN No. CPC/2425/A2/497705363 iv. Grant such other relief as this Honourable Tribunal may deem fit in the interest of justice.” 3. Thus, the main grievance of the appellant is that he was not given proper opportunity to explain his version/put-forth his arguments by way of affording personal hearing despite the specific request. The Learned Authorized Representative (hereinafter in short “Ld.AR”) of the appellant has

ITA 55/VIZ/2026 SATYA VENU GOPALA RAO KADAMATI argued by stating that not granting an opportunity of hearing is violation of the procedure prescribed under section 250(6) of the Income Tax Act, 1961 (hereinafter in short “the Act”) r.w. Faceless Appeal Scheme, 2020. Moreover, the Ld.CIT(A) did not adjudicate the grounds raised before him with regard to adjustments made by the CPC which are debatable and hence the same cannot come under the purview to section 143(1) of the Act.

ITA 55/VIZ/2026 SATYA VENU GOPALA RAO KADAMATI case. Accordingly, the Ld.CIT(A) is directed to decide the matter afresh after providing effective opportunity and personal hearing.

Order pronounced in the open court on 10th July, 2026. Sd/- Sd/- RAVISH SOOD OMKARESHWAR CHIDARA JUDICIAL MEMBER ACCOUNTANT MEMBER Visakhapatnam Dated: 10.07.2026 Giridhar, Sr.PS

ITA 55/VIZ/2026 SATYA VENU GOPALA RAO KADAMATI Copy to: SATYA VENU GOPALA RAO KADAMATI, 66-10-33/2, BUDHA VIHAR STREET, PANDURANGASWAMY TEMPLE ROAD, 1 NARASANNAGAR, KAKINADA, EAST GODAVARI- 533004, ANDHRA PRADESH

INCOME TAX OFFICER WARD-1, SRI DEEPTHI TOWERS, 2 MAIN ROAD, KAKINADA-533001, ANDHRA PRADESH

3 THE PCIT / CIT, 4 THE D.R., ITAT, VISAKHAPATNAM BENCH 5 GUARD FILE