SAVADIKA RETAIL PRIVATE LIMITED,GURGAON, HARYANA vs. INCOME TAX OFFICER, GURGAON, HARYANA

The solitary grievance of the Assessee in both the Appeals are on the action of the Ld. CIT(A) in confirming the order of the CPC by restricting the TDS credit based on turnover discrepancies between return income and Form 26AS, even though the Assessee has claimed 25/06/2025 in ITA No. 568/Hyd/2025, in the case of Shri 3. The Ld. Department's Representative relying on the orders of the Lower Authorities sought for dismissal of the Appeal.

We have heard both the parties and perused the material available on record. The Assessee was carrying principal activity of wholesale and retail goods. In both the Appeals the CPC, Bengaluru restricted the TDS credit on the ground that there was turnover discrepancies between return of income and Form No. 26AS. It is the specific case of the Assessee that the Assessee has claimed the TDS correctly as per 26AS. The Co-ordinate Bench of the Tribunal Hyderabad Bench in an identical situation, and similarly placed assessee vide order dated 25/06/2025 in ITA No. 568/Hyd/2025, in the case of Shri GopikishanPallod Hyderabad Vs. Income Tax Officer Ward 7(1), Hyderabad held as under:- “9. We have heard the rival contentions, perused the relevant material available on record and gone through the orders of the authorities below. Provisions of section 194 O of the Act deals with payment of certain sums by e-commerce operators to e- Savadika Retial Pvt. Ltd. vs. DDIT commerce participants. As per the said provision, where sale of goods or provision of service of an e-commerce participant is facilitated by e-commerce operator, such e-commerce operator at the time of credit of amount or at the time of payment whichever is earlier deduct income tax @ 1% of the gross amount of such sale or service of goods. In the present case, the appellant is an ecommerce participant and selling goods through Amazon Seller Services (P) Ltd and Reliance Retail Ltd etc., The appellant has made a turnover of Rs.1,39,42,905.95 through e-commerce operators on which TDS @ 1% has been deducted by the ecommerce platform operators. Out of the above sale, the assessee has shown sales return of Rs.23,87,202.48 and the net sales turnover declared by the assessee for the year under consideration was at Rs.1,15,55,703.47. The assessee has claimed TDS credit of Rs.1,62,412/- on the basis of Form No.26AS. The Assessing Officer CPC, allowed the proportionate credit for TDS at Rs.1,38,211/- and according to the Assessing Officer CPC as per Rule 37BA of the I.T Rules,1962 credit for TDS shall be allowed in the year in which income relatable to said TDS has been declared.

We find that, the assessee has reported the income relatable to TDS credit of Rs.1,62,412/- for the year consideration. However, the Assessing Officer misunderstood the facts and observed that the assessee has reported only part of the turnover and not entire turnover on which TDS has been deducted, only on the basis of the turnover reported in financial statement, even though the assessee has reconciled the said turnover with sales return. The assessee has reported sales return of Rs.23,87,202/- on which TDS has been deducted by the ecommerce platform operators. If we consider gross sales, sales return and net sales declared by the assessee, it tallies with the total sales achieved through e-commerce platform operators on which TDS has been deducted. Therefore, we are of the considered view that the Assessing Officer is erred in allowing credit for TDS on proportionate basis, even though the assessee has offered the income in total for the year under consideration. The reasons for the Assessing Officer to allow proportionate TDS is difference in turnover as per Form 26AS and turnover reported in the books. The assessee has explained the said difference with the sales return. If we consider sale return, then the turnover declared by the assessee tallies with the turnover reported in Form 26AS with reference to TDS credit as per section 194 O of the Act. Although, these facts has been explained to the learned CIT (A), but the learned CIT (A) based on assumption and presumption rejected the explanation of the assessee on the ground that if at all sales turnover is there, then the assessee must have replaced with other goods or refund gross amount including TDS amount. In our considered view, the TDS has been deducted by the e-platform Savadika Retial Pvt. Ltd. vs. DDIT operators at the time of sales whereas the money is returned to the buyer after e-platform operators deducted TDS. Therefore, in our considered view, the reasons given by the learned CIT (A) to reject the explanation of the assessee is on assumption and presumption, but not based on fact. Since the assessee has explained the reasons for difference in turnover and further made out a case that the total income pertains to TDS credit of Rs.1,62,412/- has been offered to tax for the year under consideration, in our considered view, the Assessing Officer ought to have allowed TDS of Rs.1,62,412/- as per Form 26AS. The learned CIT (A) without considering the relevant facts, has simply upheld the order of the Assessing Officer. Thus, we set aside the order of the learned CIT (A) and direct the Assessing Officer to allow credit for TDS of Rs.1,62,412/- as per Form No.26AS filed by the assessee.”

In the result, both the Appeals of the Assessee are allowed. Order pronounced in the open court on 07th November, 2025 (BRAJESH KUMAR SINGH) JUDICIAL MEMBER Date:- 07 .11.2025 R.N, Sr.P.S*