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Facts
The assessee filed its return of income, which was processed under section 143(1). The CPC disallowed a portion of the TDS credit claimed by the assessee due to a mismatch, leading to a demand of Rs.80,55,710/- including interest under sections 234B and 234C. The Additional/Joint CIT(Appeals) dismissed the assessee's appeal, stating that the claim was not substantiated with sufficient evidence.
Held
The Tribunal observed that the Assessing Officer passed the order under section 143(1) without providing the assessee a proper opportunity to explain the TDS mismatch. Since the Ld. Departmental Representative did not object to remitting the matter, the Tribunal set aside the CIT(Appeals) order and remanded the case back to the Assessing Officer for fresh consideration, granting the assessee liberty to submit all necessary explanations and documents.
Key Issues
Whether the disallowance of TDS credit and raising of demand under section 143(1) without affording the assessee an opportunity to be heard is valid, especially in cases of TDS mismatch.
Sections Cited
143(1), 234B, 234C
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Income Tax Appellate Tribunal, ‘A’ BENCH, KOLKATA
Before: Shri Rajesh Kumar & Shri Pradip Kumar Choubey
Per Pradip Kumar Choubey, Judicial Member:- The present appeal is directed at the instance of assessee against the order of Id. Additional/ Joint Commissioner of Income Tax (Appeals)-1, Vadodara dated 26.11.2024 passed for Assessment Year 2023-2024.
(A.Y. 2023-2024) Bitush And Rajib Construction Pvt. Limited 2. Brief facts of the case are that the assessee being a Company filed its return of income declaring total income at Rs.6,12,84,600/-. The return of income of the assessee was processed under section 143(1) at an income of Rs. 6,12,84,600/- by raising a demand of Rs.80,55,710/-. While processing the return of income, it was seen that the assesese had claimed TDS credit of Rs.1,66,13,072/-. CPC did not allow the TDS credit for Rs.69,96,669/- and there was mismatch in the TDS credit and allowed.
Aggrieved by the order of the ld. Assessing Officer, the assessee preferred an appeal before the ld. CIT(Appeals), wherein the appeal of the assessee has been dismissed by the ld. Addl./JCIT(Appeals) by holding that the assessee’s claim has not been substantiated with sufficient evidence. On being aggrieved, the assessee preferred an appeal before us.
The ld. Authorized Representative challenged the impugned order. He submitted that the ld. Assessing Officer passed the assessment order under section 143(1) on the basis of bare perusal of the 26AS credits and disallowing the credit of Rs.69,96,669/- and levied excess interest under sections 234B and 234C amounting to Rs.10,59,040/- i.e. wrong. The ld. A.R. further submits that the total excess demand raised by the ld. Assessing Officer amounting to Rs.80,55,710/- under section 143(1) while processing the income tax return without giving proper opportunity and without taking explanation from the assessee. The ld. A.R. prayed that the assessee has to give an opportunity to (A.Y. 2023-2024) Bitush And Rajib Construction Pvt. Limited place his entire explanation before the ld. Assessing Officer as the order relates to pass under section 143(1). The ld. A.R. further submits that the ld. Assessing Officer did not ask extra submission and evidence before passing the order and passed the order without taking into consideration the attachment in the form of profit and loss account and balance-sheet with the return of income filed by the assessee.
On the other hand, ld. Departmental Representative did not raise any objection in remitting the matter back to the file of ld. Assessing Officer for fresh consideration.
Upon hearing the submissions of the ld. Counsel of the respective parties, we find that it is a case of mismatch of the claim in TDS and allowed. The ld. A.R. submits that the ld. Assessing Officer did not ask any explanation from the assessee before passing of the order. I have also gone through the order passed by the ld. Addl./JCIT(Appeals) and find that the ld. Addl./JCIT(Appeals) has confirmed the order of the ld. Assessing Officer by holding that during the appellate proceeding, the assessee could not be able to substantiate its claim with sufficient evidence. It has further been held by the ld. Addl./JCIT(Appeals) that despite the request, the assessee neither submitted any documentary evidence to substantiate its claim nor provided necessary reconciliation of advance tax on total sales. In a nutshell, the ld. Addl./JCIT(Appeals) has confirmed the order of ld. Assessing Officer when assessee could not be able to substantiate its claim. Before us, the prayer of the assessee is that (A.Y. 2023-2024) Bitush And Rajib Construction Pvt. Limited the assessee has to give an opportunity to substantiate its claim before the ld. Assessing Officer. As a result of which, we are restoring the appeal of the assesese to the file of ld. Assessing Officer for fresh consideration with a liberty to the assessee to submit its explanation and documents which he deems fit and proper. The ld. Assessing Officer is directed to consider the explanation and hence pass the fresh order. We, therefore, set aside the order of ld. Additional/JCIT(Appeals) and allow the grounds of appeal of the assessee for statistical purposes.