Kunj Bihari , Agra V. JAO Ward 2(1)(2) ,Agra, Agra

ITA 158/AGR/2022

• Counselvise Citation: [2024] 130 COUNSELVISE.COM (IT) 2258 (ITAT-AGRA)
• Duration Of Justice: 1 year(s) 5 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-03-2024
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 16-01-2024
• Assessment Year: 2019-2020
• Appeal Filed On: 08-09-2022
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SHAILENDRA SRIVASTAVA
• Assessee Lawyers: PANKAJ GARG
• Keywords: TDS; Rectification of order
• Section: 154; 143(1); 139(1); 43B

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AGRA BENCH : SMC : AGRA (Through Video Conferencing) BEFORE SHRI SHAMIM YAHYA, ACCOUNTANT MEMBER AND SHRI ANUBHAV SHARMA, JUDICIAL MEMBER ITA No.158/Agr/2022 Assessment Year: 2019-20 Kunj Bihari, 16/328, Noori Gate, Agra, Uttar Pradesh. PAN: AAMPB4203A Vs AO, CPC, Bengaluru. (Appellant) (Respondent) Assessee by : Shri Pankaj Garg, Advocate Revenue by : Shri Shailendra Srivastava, Sr. DR Date of Hearing : 17.01.2024 Date of Pronouncement : 05.03.2024 ORDER PER ANUBHAV SHARMA, JM: This appeal is preferred by the Assessee against the order dated 01.07.2022 of the National Faceless Appeal Centre, Delhi (hereinafter referred as Ld. First Appellate Authority or in short Ld. ‘FAA’) in appeal No.NFAC/2018-19/10026768 arising out of the appeal before it against the order dated 08.10.2020 passed u/s 154 of the Income Tax Act, 1961 (hereinafter referred as ‘the Act’) by the CPC Bengaluru (hereinafter referred to as the Ld. AO). ITA No. 158/Agr/2022 2 2. Heard and perused the records. 2.1 The return of income of the assessee was filed on 22.09.2019 declaring an income of Rs.13,21,590/- whereas the same has been computed by CPC at an income of Rs.15,39,950/- by making the following adjustments to the extent of Rs.2,18,360/-:- i) GST payable - Rs.22,831/- ii) TDS payable - Rs.51,320/- iii) Commission payable - Rs.1,44,204/- 3. The case of the assessee is that all the amounts as mentioned above were paid before the due date as prescribed u/s 43B of the Act yet CPC had made adjustments of these amounts on account of mistake in Form No.3CD. These amounts by mistake have been mentioned in Form 3CD at clause No.26i-B(b) whereas same should have been mentioned at Cl. No.26i-B(a). The assessee claims that in response to intimation u/s 143(1)(a) received on 13.11.2019, it was mentioned that these sums stand paid before the due date of filing the return. Accordingly, an application u/s 154 was filed by the assessee for rectification of the mistake on 01.09.2020, but, the same were rejected. The assessee approached the ld.CIT(A) and the appeal of the assessee was dismissed with the following observations at paras 6.1 to 6.4:- “6.1 I have considered the facts mentioned in the grounds of appeal, statement of facts, submission of the assessee and the rectification order passed u/s 154 of the Act in case of the assessee. ITA No. 158/Agr/2022 3 6.2 The assessee in its grounds of appeal have contested that the CPC is wrong in rejecting the rectification application and making addition of Rs.2,18,355/- as all the payments outstanding were paid before the due date complying the provision of section 43B of the Act. 6.3 Upon perusal of records, it is seen that the CPC while processing the return of the assessee, disallowed an amount of Rs.2,18,355/- which included GST payable of Rs.22,831/-, TDS payable of Rs.51,320/- and Commission payable of Rs.1,44,204/-. As per the assessee the aforesaid payments were paid before the due date of filing of return and CPC has made these adjustments on account of mistake in Form 3CD. 6.4 On perusal of relevant extract of audit report in form 3CD submitted by the assesse during appellate proceedings, it is found that the CA has specified these payments in clause no. 26(i)(B)(b) instead of 26(i)(B)(a). Clause 26(i)(B)(a) is for ‘any sum as per section 43B which incurred in previous year and was paid on or before the due date for furnishing the return of income of the previous year under section 139(1)’. Clause no. 26(i)(B)(b) for ‘Not paid on or before the aforesaid date’. Section 143(1)(a)(iv) mandates adjustments on account of disallowance of expenditure indicated in the audit report but not taken into account in computing the total income in the return. In the instant case, the impugned sums were shown by the auditor against Clause no. 26(i)(B)(b) i.e these amounts were specified not to have been paid before due date for furnishing the return of income for the previous year u/s 139(1). Therefore, the intimation u/s 143(1) was correctly passed disallowing the aforesaid expenditures u/s 43B which were specified in the audit report but not taken into computation. In view of above, the grounds of appeal are hereby dismissed and rectification order u/s 154 rejecting the rectification application of the assessee is sustained. All the grounds of appeal are hereby dismissed.” 4. The ld. AR re-asserted the aforesaid facts and the claims as made before the ld. tax authorities below while the ld. DR has submitted that there is no error in the findings of the ld. tax authorities below. 5. It comes up that at page 10 of the paper book, which is part of the Form 3CD, the assessee had mentioned about the payments of the GST payable, TDS payable and commission payable being not paid on or before the aforesaid date ITA No. 158/Agr/2022 4 instead of making the mention in the column above meant for disclosing that these liabilities were paid on or before the due date for furnishing the return of income of the previous year u/s 139(1) of the Act. 5.1 At page 26, copy of the bank account is filed which shows that commission payable of Rs.14,206/- was paid on 4 th May, 2019. At page No.27 is a challan of deposit of Rs.7,584/- and at page No.28 is the challan of deposit of Rs.43,736/- on account of TDS payable and the same is shown to be dated without any late fee. Similarly, in regard to GST payable the assessee has provided at page 29 of the paper book that the same was deposited on 23.04.2019. 6. We are of the considered view that the ld. tax authorities have fallen in error in not appreciating that these evidences. Merely on the basis of information mentioned in audit report in Form 3CD, by the concerned professional does not forbid the assessee from making the right claim during assessment. We are of the considered view that such an approach of the ld. tax authorities cannot be justified as they are supposed to take note of the correct facts and the assessee cannot be prejuidiced only for certain mistakes of facts creeping into the return which otherwise are well explained during the assessment proceedings. ITA No. 158/Agr/2022 5 7. The grounds raised are sustained. However, instead of quashing the impugned order, we are inclined to restore the issue on merits for verification of the evidences/information provided by the assessee. The ld. AO shall pass a fresh order. Needless to say that if required, additional information/evidences may be called by the AO. 8. In the result, the appeal of the assessee is allowed for statistical purposes. Order pronounced in the open court on 05.03.2024. Sd/- Sd/- (SHAMIM YAHYA) (ANUBHAV SHARMA) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated: 05.03.2024. dk Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(A) 5. DR Asstt. Registrar, ITAT, New Delhi