SURESH CHAND AGRAWAL HUF,MATHURA vs. INCOME TAX OFFICER 1(3)(1), MATHURA, MATHURA
Facts
The assessee HUF received proceeds from compulsory acquisition of property, which was exempt from tax. The payer deducted TDS in the name of the Karta and a HUF member. The HUF claimed credit for the total TDS, but the CPC initially granted only partial credit and later denied the entire credit due to a mismatch in Form 26AS.
Held
The Tribunal restored the appeal to the Assessing Officer for de novo adjudication. The AO was directed to verify if the Karta and the HUF member had not claimed the TDS credit in their individual returns. If confirmed, the AO should grant the full TDS credit to the HUF.
Key Issues
The key legal issue is whether the assessee HUF is entitled to claim the full TDS credit when the tax was deducted in the names of its Karta and a member, but the income belongs to the HUF and is exempt, and the individuals have not claimed the credit.
Sections Cited
Section 154, Section 143(1)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, AGRA BENCH “SMC”: AGRA
The appeal in ITA No. 614/AGR/2025 for AY 2023-24, arises out of the order of the Jt. Commissioner of Income Tax (Appeals)-2, Coimbatore [hereinafter referred to as ‘ld. JCIT(A)’, in short] dated 11.12.2025 against the order of assessment passed u/s 154 of the Income-tax Act, 1961 (hereinafter referred to as ‘the Act’) dated 03.01.2025 by the ld Assessing Officer, CPC, Bengaluru (hereinafter referred to as ‘ld. AO’).
I have heard the rival submissions and perused the materials available on record. The assessee is a HUF. The HUF owned an immovable property which was subjected to compulsory acquisition and proceeds were received. The payer deducted tax at source at the rate of 1% on Rs 4,66,00,000/- in the name of Karta of HUF and 1% on Rs 4,66,00,000/- in the name of Rajni Agarwal (member of HUF). Since the immovable property was owned by the HUF, the HUF had to claim the credit of TDS of Rs 9,32,000/-. It is not in Page | 1
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dispute that the proceeds received on compulsory acquisition of the property is exempt in the hands of the assessee HUF. The assessee accordingly claimed exemption for the same and claimed credit of TDS of Rs 9,32,000/- in the return of income filed on 27.5.2023. The Schedule of TDS enclosed in Page 35 of the Paper Book which is part of the return of income is very clear in this regard. The assessment was framed u/s 143(1) of the Act by the ld CPC wherein the credit of TDS of Rs 4,66,000/- alone was granted and another sum of Rs 4,66,000/- TDS was denied. The assessee filed rectification application u/s 154 of the Act before the ld CPC. The ld CPC vide order u/s 154 of the Act dated 3.1.2025 withdrew the TDS credit of Rs 4,66,000/- originally allowed by it and denied the total TDS credit of Rs 9.32,000/- on the ground of TDS mismatch in Form 26AS with the assessee. The appeal filed by the assessee against the 154 order of ld CPC before the ld NFAC was invain.
The ld AR submitted that both the Karta of HUF and Rajni Agarwal (member of HUF) had not claimed the TDS credit of Rs 4,66,000/- each in their income tax returns and they had also specifically mentioned this fact in the Schedule of TDS filed along with the return of income. The evidence in this regard is enclosed in Page 121 and 209 of the Paper Book. This fact has not been appreciated by the lower authorities. Hence, in the interest of justice and fairplay, I deem it fit and appropriate to restore this appeal to file of ld AO for de novo adjudication in accordance with law. The ld AO is directed to examine the fact as to whether the Karta of HUF and Rajni Agarwal (member of HUF) had not claimed the TDS credit of Rs 4,66,000/- each in their respective returns. If it is found to be correct, then the ld AO should grant TDS credit to the assessee in the sum of Rs 9,32,000/- as corresponding income is considered in the hands of the assessee HUF herein, dehors the fact that the
ITA No. 614/AGR/2025 Suresh Chand Agarwal HUF
same is exempt in the hands of the assessee. With these observations, the grounds raised by the assessee are allowed for statistical purposes.
In the result, the appeal of the assessee is allowed for statistical purposes.
Order pronounced in the open court on 23/01/2026.
-Sd/- (M. BALAGANESH) ACCOUNTANT MEMBER Dated: 23/01/2026 A K Keot Copy forwarded to 1. Applicant 2. Respondent 3. CIT 4. CIT (A) 5. DR:ITAT ASSISTANT REGISTRAR ITAT, New Delhi
