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Facts
The Assessing Officer (AO) passed an order under Section 201(1)/201(1A) of the Income Tax Act, 1961, treating the assessee as an assessee in default for non-deduction or short deduction of TDS for AY 2011-12 (FY 2010-11). The Ld. CIT(A) dismissed the assessee's appeal, asserting that the assessee failed to substantiate its claims. The assessee subsequently appealed to the Tribunal, presenting a detailed chart and paper book to demonstrate that TDS was either duly deducted and paid, or not liable for deduction.
Held
The Tribunal observed that the assessee had provided comprehensive explanations and supporting evidence in the paper book for all issues raised by the AO. It was found that TDS was correctly deducted and paid where applicable, and not deducted where there was no liability. Given that the matter pertained to a financial year (2010-11) over a decade old and evidence was before the lower authorities, the Tribunal deemed re-verification unnecessary and annulled the AO's order treating the assessee as in default.
Key Issues
Whether the assessee could be treated as an "assessee in default" under Section 201(1)/201(1A) for alleged non-deduction or short deduction of TDS, despite providing evidence demonstrating compliance or non-liability to the lower authorities.
Sections Cited
250, 201(1), 201(1A), 154, 9(1)(vi), 9(1)(vii), 194I, 194C, 194J, 192
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, “C” BENCH, KOLKATA
Before: SHRI GEORGE MATHAN & SHRI RAKESH MISHRA
Present for: Appellant by : Shri S. K. Tulsiyan, Advocate Respondent by : Ms. Rama Choudhary, Sr. DR Date of Hearing : 04.03.2025 Date of Pronouncement : 04.03.2025 O R D E R Per Bench : This is an appeal filed by the assessee against the order of the Ld. Commissioner of Income Tax (Appeals), Kolkata-27 [hereinafter referred to as “the Ld. CIT(A)”] vide order no. ITBA/APL/S/250/2024- 25/1066100213(1) dated 26.06.2024 passed u/s. 250 of the Income Tax Act, 1961 (hereinafter referred to as “the Act”) for AY 2011-12.
Shri S. K. Tulsiyan, Advocate appeared on behalf of the assessee and Ms. Rama Choudhary, Sr. DR appeared on behalf of the revenue.
It was submitted by the Ld. AR that for the Financial Year 2010-11 wherein the Assessing Officer has passed an order u/s. 201(1)/201(1A) of the Act treating the assessee as an assessee in default on account of non- deduction of TDS under various provisions. The Ld. AR filed before us a chart explaining each of the additions along with reference to the voluminous paper book. The chart reads as follows:
It was the submission that allegedly in the order u/s. 201(1)/201(1A) the Assessing Officer mentioned that the notice was issued to the assessee on 15.03.2018 to submit compliance within five days. It was the submission that the assessee had submitted the details on 27.03.2018 whereas by 26.03.2018 the AO had passed the order. It was the submission that on appeal before the Ld. CIT(A) substantial evidences were filed as has been demonstrated by the e-Proceedings Response Acknowledgment which reads as follows:
It was the submission that the Ld. CIT(A) without considering the response of the assessee took a stand that the assessee has not been able to substantiate its case and its claims and had consequently dismissed the appeal of the assessee. The Ld. AR drew our attention to the chart as submitted by him along with the various reference to the paper book to show that where TDS was required to be made the assessee has deducted the TDS. In respect of special allowance and staff welfare expenses the same was part of the salary and the salary shows the same figure and the salary is being less than Rs.1,60,000/- no TDS was liable to be deducted and consequently not deducted. In regard to each of the issue, the Ld. AR took us through the paper book. It was the submission that all details have been produced before the Assessing Officer and the Ld. CIT(A) and, therefore, in the interest of justice the issues should not be restored to the file of the Assessing Officer or the Ld. CIT(A) for re-adjudication in so far as the order u/s. 201(1) was passed on 26.03.2018 the appeal was filed in 2018 by the assessee and the same was disposed of only in 2024 by the Ld. CIT(A) as the matter relates to the FY 2010-11. It was the prayer that as all evidence have also now been placed before the Tribunal and there was no further liability to deduct TDS the assessee should not be treated as assessee in default.
In reply, the Ld. Sr. DR vehemently supported the orders of the Assessing Officer and the Ld. CIT(A). It was the submission that the Assessing Officer had given opportunity to the assessee and the assessee had filed the details only after the order of the Assessing Officer. Nothing stopped the assessee from filing rectification application u/s. 154. It was the submission that before the Ld. CIT(A), the assessee has only filed the screen-shot of uploading of details and what has been uploaded has not been shown. It was the submission that she has no objection if the matter is restored to the file of the Assessing Officer for verification.
We have considered the rival submissions. A perusal of the chart as filed by the assessee clearly shows that it has explained each and every one of the issues raised by the Assessing Officer in the order u/s. 201(1)/201(1A) of the Act. The explanation is supported by the evidence in the paper book. In most of the cases TDS is not liable to be deducted. It is also noticed that where TDS is liable to be deducted it has been deducted and it has also been paid to the account of the Central Government is supported by the challan. This being so, we are of the view that the assessee should not be treated as an assessee in default for the alleged default as mentioned by the Assessing Officer. Coming to the order of the Ld. CIT(A), a perusal of the e-Proceedings Acknowledgment Response shows that the description of the attachment clearly covered each of the issues which have been raised by the Assessing Officer in the order passed u/s. 201(1)/201(1A). As mentioned earlier, as the assessee has already shown that where TDS was required to be made the same has been done and paid to the account of the Central Government and where it was not required to be deducted it was not deducted, therefore, considering the facts that the issues relate to the FY 2010-11 and substantial time has passed, there is no purpose in sending back the issue for reverification. This being so, and also considering the fact that the evidences were before the lower authorities, the order passed u/s. 201/201(1A) by the Assessing Officer dated 26.03.2018 treating the assessee as an assessee in default is annulled. The appeal of the assessee is allowed.
In the result, the appeal of the assessee is allowed.
Order dictated and pronounced in the open court.