M/S. BANKURA DISTRICT CENTRAL CO OPERATIVE BANK LTD. ,BANKURA vs. ITO,WARD-4(4),TDS, BANKURA. , BANKURA

This is an appeal preferred by the assessee against the order of Ld. CIT(A), National Faceless Appeal Centre (NFAC), Delhidated 18.03.2022 for AY 2017-18.

The only issue raised by the assessee is only against the order of Ld. CIT(A) upholding the order of AO passed u/s. 201(1)/201(1A) of the Income Tax Act, 1961 (hereinafter referred to as the “Act”) whereby a demand of Rs.4,21,00,850/- was raised on account of non-deduction of TDS and interest thereon. 3. At the outset, Ld. Counsel for the assessee submitted that the assessee is a District Central Cooperative Bank and is carrying on the business of banking. The assessee receives deposits from the public at large and allows interest on said deposits. , In case the interest exceeds Rs. 10,000/- then the assessee is required to be deducted TDS u/s. 194A of the Acton the amount of interest credited/paid. A survey u/s. 133A of the Act was conducted on the business premises of the assessee on 31.10.2017 by ITO (TDS) and found several anomalies in the deduction of TDS by the assessee. The AO also noted that assessee has not furnished Form 15G/15H with the competent authority and finally came to the conclusion that there was a violation of section 194A read with sec. 201(1)/201(1A) of the Act and finally computed the TDS and interest thereon at Rs.4,21,00,850/-. 4. The Ld. Counsel also submitted that in the appellate proceeding, Ld. CIT(A) called for a remand report during which the assessee filed all necessary details with the AO. The Bankura Dist. Central Coop. Bank Ltd., AY 2017-18 said remand report was also submitted before the Ld. CIT(A), hsowever, Ld. CIT(A), dismissed the appeal of the assessee without taking into account the remand report. The Ld. AR prayed that the assessee wants to file all the relevant details before the AO including Form G & Form H, details of individual depositor, TDS deducted and in case of non- deduction of TDS the explanation therefor. Therefore, in the interest of justice and fairplay, the issue may be remitted to the file of the AO for fresh adjudication after taking into account the details and explanation to be submitted by the assessee.

Ld. DR, on the other hand, opposed the arguments of the Ld. AR by submitting that though the Ld. CIT(A) has not considered the remand report but the attitude of the assessee before the authorities below was completely non-cooperative, and therefore, the appeal of the assessee may kindly be dismissed.

After hearing the rival contentions and material available on record, we find that a survey u/s. 133A of the Act on conducted on the assessee by the ITO, TDS during which it was observed that in a number of cases the assessee has not deducted TDS and not deposited with the government treasury and accordingly a huge demand raised. In the appellate proceeding, a remand report was called for. However, the Ld. CIT(A) dismissed the appeal without taking into account the remand report furnished by the AO. We also take note of the fact that Form G and Form H of individual depositors, tax deducted at source, explanation of the assessee for not deducting TDS need to be examined at the level of the AO and then correct amount of TDS non deducted could be quantified and interest has to be charged accordingly. Accordingly, we restore the issue to the file of the AO with a direction to examine the evidences/documents which may be furnished by the assessee in respect of its claim and only thereafter decide the case on merit. Accordingly, we restore this issue to the file of the AO to adjudicate afresh after affording reasonable opportunity to the assessee to file its explanation and necessary documents and then decide it accordingly.

In the result, the appeal of assessee allowed for statistical purposes. Order is pronounced in the open court on 5th January, 2024 Sd/- Sd/- (Sonjoy Sharma) (Rajesh Kumar) Judicial Member Accountant Member Dated: 5th January, 2024 JD, Sr. PS