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Facts
The assessee, a partnership firm in construction, had its TDS claim of Rs.15,69,603/- disallowed by the CPC under Section 143(1) because the corresponding receipts were not recorded in the relevant financial year, raising a demand with interest per Rule 37BA. The assessee's rectification application was rejected, and its subsequent appeal before the Addl./JCIT(A) was dismissed ex-parte due to non-appearance.
Held
The Tribunal, noting the ex-parte dismissal by the Addl./JCIT(A) and in the interest of justice, restored the issue to the Addl./JCIT(A) for fresh adjudication. The assessee is directed to participate in the appeal proceedings and submit all requisite details, failing which the Addl./JCIT(A) is at liberty to pass appropriate orders as per law.
Key Issues
Whether the ex-parte dismissal of the appeal by the Addl./JCIT(A) was justified, and if the CPC's disallowance of TDS for advance receipts recognized in subsequent years was legally valid.
Sections Cited
143(1), 37BA
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, PUNE BENCH “A”, PUNE
Before: JUSTICE (RETD.) C V BHADANG & SHRI R. K. PANDA
The above 2 appeals filed by the assessee are directed against the separate orders dated 26.02.2025 of the Ld. Addl/JCIT(A)-1, Kolkata relating to assessment years 2022-23 and 2023-24. Since identical grounds have been raised by the assessee in both the appeals, therefore, for the sake of convenience, these were heard together and are being disposed of by this common order.
ITA No.1057/PUN/2025 (A.Y. 2022-23)
Although a number of grounds have been raised by the assessee, however, these all relate to the ex-parte order of the Ld. Addl/JCIT(A) in confirming the order of the CPC disallowing the claim of TDS of Rs.15,69,603/- as reflected in 26AS.
Facts of the case, in brief, are that the assessee is a partnership firm engaged in the business of construction of residential and commercial projects. It filed its return of income on 30.09.2022 declaring total income at Rs.54,34,100/-. The CPC in the intimation passed u/s 143(1) of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) disallowed the claim of TDS of Rs.15,69,603/- on the ground that the corresponding receipts in respect of such TDS were not taken in the relevant financial year. Accordingly, the CPC raised a demand along with interest as per Rule 37BA. The assessee filed a rectification application before the CPC which was rejected. Thereafter, the assessee filed an appeal before the Ld. Addl/JCIT(A), who dismissed the same on account of non-appearance.
Aggrieved with such order of the Ld. Addl/JCIT(A), the assessee is in appeal before the Tribunal.
The Ld. Counsel for the assessee submitted that the receipt was an advance payment which was credited to the books as a liability i.e. advance from customers and the corresponding revenue was recognized on the completion of the project in assessment years 2024-25 and 2025-26 and due taxes have been paid. Referring to various pages of the paper book, he submitted that the assessee has not claimed any TDS of assessment year 2022-23 again in the assessment year in which corresponding receipts are offered for tax i.e. assessment years 2024-25 and 2025- 26. He submitted that he has no objection if the matter is restored to the file of the Ld. Addl/JCIT(A) for fresh adjudication since he has passed an ex-parte order.
The Ld. DR on the other hand heavily supported the order of the Ld. Addl/JCIT(A).
We have heard the rival arguments made by both the sides, perused the orders of the Assessing Officer and the Ld. Addl/JCIT(A) and the paper book filed on behalf of the assessee. It is an admitted fact that due to non-compliance to the statutory notices issued by the Ld. Addl/JCIT(A), he dismissed the appeal for want of prosecution. It is the submission of the Ld. Counsel for the assessee that in the interest of justice the assessee should be given one final opportunity to substantiate its case by filing the requisite details before the Ld. Addl/JCIT(A). Considering the totality of the facts of the case and in the interest of justice, we deem it proper to restore the issue to the file of the Ld. Addl/JCIT(A) with a direction to decide issue as per fact and law after giving due opportunity of being heard to the assessee. The assessee is also hereby directed to participate in the appeal proceedings and submit the requisite details before the Ld. Addl/JCIT(A) on the appointed date without seeking any adjournment under any pretext, failing which the Ld. Addl/JCIT(A) is at liberty to pass appropriate order as per law. We hold and direct accordingly. The grounds raised by the assessee are accordingly allowed for statistical purposes.
After hearing both sides we find the grounds raised by the assessee are identical to the grounds raised in assessment year 2022-23. We have already decided the issue and the matter has been restored to the file of the Ld. Addl/JCIT(A) with a direction to decide the issue afresh. Following similar reasonings, we allow the grounds raised by the assessee for statistical purposes.
In the result, both the appeals filed by the assessee are allowed for statistical purposes.
Order pronounced in the open Court at the conclusion of hearing itself i.e. on 24th November, 2025.