SHRI JAGANNATH TRANSPORT CORPORATION, RAIPUR,RAIPUR vs. DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE-1, RAIPUR, RAIPUR

The captioned appeal is filed by the assessee against the order of Commissioner of Income Tax (Appeals)/ Addl / JCIT (A)-1, Nasik, [in short “Ld. CIT(A)”], passed on 22.01.2025, under section 250 of the Income Tax Act, 1961 (in short “the Act”), for the Assessment Year 2023-24, which in turn arises out of the intimation passed u/s 143(1) by the Centralized Processing Centre (hereinafter referred to as “CPC”), Bengaluru, dated 24.04.2024.

The appellant reserves the right to add, amend or alter any grounds of appeal at any time of hearing.

Brief facts of the case are that the assessee had filed its Return of Income for the Assessment Year 2023-24 on 28.10.2023, declaring total income of Rs. 2,23,12,720/-, claiming refund of Rs.71,77,330/-. While processing the return of assessee, the same was considered defective by the CPC and notice u/s 139(9) was issued on 13.02.2024, stating that the gross receipts of assessee reflecting in Form 26AS, on which credit for TDS has been claimed, are higher than the total of the receipts shown under all heads of income, in the return of income. Thus, while credit for TDS is being claimed, the corresponding receipts are not offered in the respective income schedules, to arrive at the taxable total income. Hence, the return of income filed is regarded as defective, as provided in Explanation (a) under section 139(9) and accordingly, the TDS credit granted to assessee was computed and has been reduced to Rs. 1,26,52,567/- as against of Rs.1,49,62,620/- Sri Jagannath Transport Corporation Vs DCIT, Circle-1(1), Raipur claimed by the assessee in its return income. Consequently, the refund amount claimed by the assessee has been reduced to Rs. 23,10,053/-.

Being aggrieved with the reduction in refund through intimation order u/s 143(1) by the CPC. The appellant / assessee filed an appeal before the First Appellate Authority, wherein the appeal of assessee is dismissed by the Ld. CIT(A) with the following observations: In view of the above, it is inferred that the information regarding the deduction of tax and deposit of such tax deducted by the deductor has to be given to the Central Government and in a certificate to be issued to the deductee. This can be evidenced by TDS certificate and Form 26AS. A perusal of the Form 26AS of the appellant shows that Rs. 1,26,64,229/- was deducted against a payment of Rs. 2,23,12,720/-. Since TDS of Rs. 1,26,64,229/- is evidenced by Form 26AS pertaining to the appellant, the grant of credit of TDS of Rs. 1,26,64,229/- against the TDS claimed in ITR of Rs. 1,49,74,282/- oy the CPC and disallowed the TDS of Rs. 23,10,053/-is correct and justified. The contention made by the appellant is not acceptable. The ground raised by the appellant is dismissed.

At the outset, it is submitted by the Ld. AR on behalf of the assessee that the TDS claimed by the assessee in its return are not allowed by the CPC on account of variation in gross receipts shown by the assessee in its return of income and the gross receipt as per Form 26AS. It was the submission that the reason for higher amount that gross receipt in Form 26AS Sri Jagannath Transport Corporation Vs DCIT, Circle-1(1), Raipur was on account of deduction of TDS on GST amounts also by some parties and some parties are following cash basis of accounting system, due to which they deducted TDS in the year of payment, and accordingly, the said receipts were already accounted for by the assessee in the earlier year, therefore, such receipts need not be taken as income for the year under consideration. To explain the aforesaid facts and contentions, a written synopsis has been furnished by the Ld. AR along with reconciliation regarding gross receipts of the assessee as per its return of income viz-a-viz gross receipts in Form 26AS. For the sake of completeness, the synopsis submitted by the assessee is extracted as under:

Per contra, Ld. Sr. DR, representing the revenue submitted that since the assessee was unable to explain the variation in gross receipts shown in the Form 26AS as against the lower amount shown by the assessee in its Return of Income, therefore, the Ld. CIT(A) had rightly confirmed the disallowance and dismissed the appeal of the assessee. Ld. Sr. DR vehemently supported the order of revenue authorities and requested to uphold the same.

We have considered the rival submissions, perused the material available on record. On perusal of the findings of Ld. CIT(A), it is found that the assessee had made explanatory submissions and reply before the First Appellate Authority, however, the decision of the Ld. CIT(A) was without verifying the facts by himself or through the Ld. AO, therefore, in the interest Sri Jagannath Transport Corporation Vs DCIT, Circle-1(1), Raipur of justice, the reconciliation prepared and submitted by the assessee before us, needs further verification by the revenue authorities. Consequently, the matter deserves to be restored back to the file of Ld. CIT(A), who had decided the issue without adhering to the provisions of section 250(4) & (6).

In terms of our aforesaid observations, the matter is directed to set aside to the file of Ld. CIT(A) to verify the facts furnished by the assessee and accordingly decided the issue afresh in according to the provisions of law, within a period of 3 months from receipt of this order.

Needless to say, the assessee shall be afforded with reasonable opportunity of being heard in the set aside appellate proceedings. The assessee as conceded through its authorized representative before us, also directed to cooperate and assist proactively in the set aside proceedings, failing which the Ld. CIT (A) would be at liberty to decide the case in accordance with the mandate of law.

In result, appeal of the assessee is allowed for statistical purposes, in terms of over aforesaid observations.