LAKHMANBHAI MARU,VADODARA vs. ITO, WARD 1(2)(1), VADODARA, AAYAKAR BHAVAN, BARODA

ITA 1046/AHD/2026Status: DisposedITAT Ahmedabad30 September 2026AY 2024-255 pages
AI SummaryDismissed

What were the facts?

The assessee, Shri Lakhmanbhai Maru, is appealing an order dated 19-01-2026 by the CIT(A) for Assessment Year (AY) 2024-25. The dispute concerns a TDS credit of ₹1,83,045/- deducted on compensation received for compulsory acquisition of rural agricultural land. The TDS was deducted on 23-03-2023 and reflected in Form 26AS for AY 2023-24. The assessee filed his return for AY 2023-24 without reflecting this compensation, and consequently, the refund was not considered. For AY 2024-25, the assessee claimed the same TDS credit, which was not granted. A rectification request under Section 154 for AY 2024-25 was rejected because Form 26AS did not show the TDS for that specific AY. The CIT(A) dismissed the appeal for AY 2024-25, holding that filing Form 71 under Section 155(20) read with Rule 134 was mandatory, and this form was not filed.

What did the Tribunal hold?

The Tribunal noted that it is an admitted fact that the TDS was deducted on 23-03-2023 and reflected in Form 26AS pertaining to AY 2023-24. Therefore, the assessee's claim for credit of the said TDS in AY 2024-25 cannot be accepted. The Tribunal found that the CIT(A)'s reliance on Section 155(20) read with Rule 134/Form 71 did not appropriately address the factual situation, as the TDS was deducted during FY 2022-23 relevant to AY 2023-24. Since AY 2023-24 is not before the Tribunal in the present proceedings, it refrained from expressing a concluded opinion on the maintainability of the assessee's claim or its entitlement to TDS credit for AY 2023-24. These issues were expressly left open for consideration by the CIT(A) in the pending appeal for AY 2023-24. The Tribunal clarified that the rejection of the assessee's claim in AY 2024-25 was solely on the ground that the TDS did not pertain to that assessment year and should not be construed as an adjudication of the assessee's entitlement to such credit/refund in AY 2023-24. The CIT(A), while deciding the appeal for AY 2023-24, was given liberty to examine Form 26AS, the fact of deduction and deposit of tax, the nature and taxability/exemption of the compensation, and applicable judicial precedents. The appeal filed by the assessee for AY 2024-25 was dismissed.

What were the issues?

1. Whether the assessee is entitled to claim TDS credit of ₹1,83,045/- for AY 2024-25, considering the TDS was deducted in FY 2022-23 (AY 2023-24) and the compensation for compulsory acquisition of rural agricultural land is not a capital asset under Section 2(14) and thus not chargeable to tax. - Assessee's contention: The TDS credit should be allowed as the income is not taxable. The denial of refund on procedural grounds leads to unjust enrichment of the Revenue. Form 71 is not applicable when the income itself is not assessable. The CIT(A) erred in applying Rule 134 and Form 71 retrospectively, as they were introduced from 01.10.2023, while TDS was deducted in FY 2022-23. - Revenue's contention: Not recorded in the judgment. 2. Whether the CIT(A) erred in holding that filing of Form 71 under Section 155(20) read with Rule 134 was mandatory for claiming the TDS credit for AY 2024-25. - Assessee's contention: Form 71 is not applicable where the income itself is not assessable to tax. Denial of refund on such procedural grounds results in unjust enrichment of the Revenue. The said provisions were introduced only with effect from 01.10.2023, whereas the TDS was deducted during FY 2022-23. - Revenue's contention: Not recorded in the judgment. 3. Whether the authorities below erred in rejecting the appellant's claim during rectification proceedings despite the error being apparent on record, thereby defeating the object of Section 154. - Assessee's contention: The error was apparent on record, and the rectification proceedings should have allowed the claim. - Revenue's contention: Not recorded in the judgment. 4. Whether, if TDS credit is not carried forward due to non-filing of Form 71, the assessee should be allowed the claim in FY 2022-23 itself, and whether the TDS credit should be determined and allowed in the respective year. - Assessee's contention: If TDS credit cannot be carried forward, it should be allowed in FY 2022-23, and the TDS credit should be allowed in the respective year.

Which sections of the Income-tax Act were involved?

Section 2(14),Section 143,Section 154,Section 155(20),Section 194A,Section 194LA,Section 250

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, AHMEDABAD “SMC” BENCH

Before: Shri Sanjay Garg & Shri R. Govindarajan

For Appellant: Shri Urjit Rawat, A.R
For Respondent: Ms. Madhulika Satpute, Sr. D.R

PER R. GOVINDARAJAN, ACCOUNTANT MEMBER:

The assessee has filed the appeal against the order dated 19-01- 2026 passed by Commissioner of Income Tax (Appeals)/Addl/JCIT(A)-3 Chennai (in short, referred to as the CIT(A)) u/s. 250 of the Income Tax Act, 1961 (herein referred to as “the Act”) relating to Assessment Year 2024-25. 2. The assessee raised the following grounds of appeal:- “1. Section 2(14), 143, 154, 1944, 194LA: That at the time of processing of return under section 143(1) and while passing the rectification order under section 154, the learned Assessing Officer has erred both in law and on facts in not allowing the claim of TDS credit of "1,83,045/-, deducted on compen

The order continues below.

Read the full judgment

A free account opens 10 full judgments a month. Re-reading one you have already opened does not count again.

Create a free accountSign in

See plans and prices

The summary, the parties, the sections and the citations above are open to everyone and always will be. Only the text of the order and the PDF are metered.

More judgments on Section 2(14)

All 1,116 judgments and leading authorities on Section 2(14) →

Recent GST High Court judgments

Search GST case law →