Mehar Chand Gupta, Alwar V. Income Tax Officer, Alwar

ITA 27/JPR/2022

• Counselvise Citation: [2022] 105 COUNSELVISE.COM (IT) 7374 (ITAT-JAIPUR)
• Duration Of Justice: 1 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-03-2022
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2017-2018
• Appeal Filed On: 19-01-2022
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Condonation of delay; TDS; FORM 26AS
• Section: 56; 234B; 143(1); 2(A)

Judgement Text

1 ITA No.27/JP/2022 Shri Mehar Chand Gupta vs ITO, Alwar vk;dj vihyh; vf/kdj.k] t;iqj U;k;ihB] t;iqj IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES,”SMC” JAIPUR Mk0 ,l- lhrky{eh] U;kf;d lnL; ,oa Jh jkBksM deys'k t;UrHkkbZ] ys[kk lnL; ds le{k BEFORE: DR. S. SEETHALAKSHMI, JM & SHRI RATHOD KAMLESH JAYANTBHAI, AM vk;dj vihy la- @ITA No. 27/JP/2022 fu/kZkj.k o"kZ@Assessment Year : 2017-18 Shri Mehar Chand Gupta Old Station Road, Alwar cuke Vs. The ITO Alwar LFkk;h ys[kk la-@thvkbZvkj la-@PAN/GIR No.: ABPPG 4119 E vihykFkhZ@Appellant izR;FkhZ@Respondent fu/kZkfjrh dh vksj ls@Assessee by : Shri P.C. Parwal, CA jktLo dh vksj ls@Revenue by: Smt. Runi Pal, Addl. CIT lquokbZ dh rkjh[k@Date of Hearing : 22/02/2022 mn?kks"k.kk dh rkjh[k@Date of Pronouncement: 08 /03/2022 vkns'k@ORDER PER: RATHOD KAMLESH JAYANTBHAI, AM This appeal by the assessee is directed against the order of the ld. CIT(A) dated 27-08-2021, National Faceless Appeal Centre, Delhi [ hereinafter referred to as (NFAC) ] for the assessment year 2017-18. 2. The hearing of the appeal was concluded through video conference by both the parties in view of the prevailing situation of Covid-19 Pandemic. 3.1 At the outset of the hearing, the Bench observed that there is delay of 86 days in filing the appeal by the assessee for which the ld.AR of the assessee filed a 2 ITA No.27/JP/2022 Shri Mehar Chand Gupta vs ITO, Alwar condonation application dated 16-01-2022 mentioning therein that delay in filing the appeal by the assessee is occurred due to death of assessee's son Shri Himanshu Gupta on account of blood cancer and also due to Covid-19. Thus, the ld.AR of the assessee prayed that the assessee is prevented by sufficient cause in late filing the appeal before ITAT and the delay occurred may kindly be condoned. 3.2 On the other hand, the ld. DR objected to such delay but left the matter on the Bench to consider it as deem fit and proper in the case. 3.3 We have heard both the parties and perused the materials available on record. We find that there is national wide Covid 19 Pandemic situation which is beyond the control of the human being. It is also noted that the son of the assessee passed away due to blood cancer and Covid-19. Thus the assessee is prevented by sufficient cause in not filing the appeal in time. The Hon'ble Supreme Court in the case of Collector, Land Acquisition vs. Mst. Katiji, 167 ITR 471 observed as under:- ‘’The Legislature has conferred power to condone delay by enacting section 5 of the Limitation Act, 1963, in order to enable the courts to do substantial justice to parties by disposing of matters on merits. The expression " sufficient cause " in section 5 is adequately elastic to enable the courts to apply the law in a meaningful manner which subserves the ends of justice--that being the life-purpose of the existence of the institution of courts. A justifiably liberal approach has to be adopted on principle. "Every day's delay must be explained" does not imply a pedantic approach. The doctrine must be applied in a rational, common sense and pragmatic manner. 3 ITA No.27/JP/2022 Shri Mehar Chand Gupta vs ITO, Alwar The doctrine of equality before law demands that all litigants, including the State as a litigant, are accorded the same treatment and the law is administered in an evenhanded manner. There is no warrant for according a step-motherly treatment when the State is the applicant praying for condonation of delay. "When substantial justice and technical considerations are pitted against each other, the cause of substantial justice deserves to be preferred, for the other side cannot claim to have a vested right in injustice being done because of a non-deliberate delay." Keeping in view the present facts and circumstances of the case, the application of the assessee for condonation of delay in filing the appeal is allowed. 4.0 The grounds of appeal raised by the assessee are as under:- 1. The Ld. CIT(A) has erred in law as well on the facts and circumstances of the case in dismissing the appeal on the ground of non maintainable since no order u/s 143(1) was filed. Further Ld. CIT(A) has dismissed the appeal being belated appeal but the fact remains that the assessee has filed the appeal against order u/s 143(1) r.w.s. 154 dt. 15.06.2019 on 22.06.2019, thus very much within the limitation period. Hence, the order of CIT(A) is factually incorrect and deserved to be quashed. 2. The Ld. AO has erred in law as well on the facts and circumstances of the case in making addition of Rs.2,62,930/- without any basis and ground within the meaning of section 56 of IT Act, 1961 and the CIT(A) has erred in not giving any finding thereon. 3. The Ld. AO has erred in law as well on the facts and circumstances of the case in not giving the credit of TDS of Rs.56,122/- u/s 194A and self assessment tax of Rs.7,230/- u/s 140A of IT Act, 1961 though shown in 26AS of assessee pertaining to relevant AY and the Ld. CIT(A) has erred in not giving any finding thereon. 4. That the AO has erred in law as well as on the facts and circumstances of the case in making wrong calculation of interest u/s 234B and 234C of the I.T. Act, 1961 and the ld. CIT(A) has erred in not giving any8 finding thereon. 5. That the AO has erred in law as well as on the facts and circumstances of the case in creating a demand of Rs.1,54,210/- within the meaning of section 156 of the I.T. Act, 1961 and the ld. CIT(A) has erred in not giving any finding thereon. 4 ITA No.27/JP/2022 Shri Mehar Chand Gupta vs ITO, Alwar 5.1 Apropos Ground No. 1 to 3 of the assessee, the facts as emerges from the order of the ld. CIT(A) are as under:- ‘’5. Decision:- I have gone through the appellant’s submissions. This office vide notice dated 9-08-2021 has specifically asked the appellant to submit copy of order u/s 143(1). Also appellant was specifically asked following questions. ‘’The appellant has mentioned section 143(1) in column number 2(a) but no orders u/s 143(1) enclosed. Also orders number not mentioned in 2(1a) of the Form 35 Date of service of orders & date of orders u/s 143(1) is wrong. However, though the appellant filed submission on 10 th August 2021 but failed to file copy of the order u/s 143(1). Thus appellant has not filed copy of order u/s 143(1) against which the appellant has filed this appeal. Appellant has also not mentioned the order number in the Form No. 35. In the absence of the order u/s 143(1) against which this appeal has been filed, it is impossible to decide the appeal. Appellant failed to submit copy of the order even after giving opportunity. Therefore, the appeal is dismissed as not maintainable. Appellant has mentioned the date of order u/s 143(1) as 15-06- 2019 in Form No. 35. But the date 15-06-2019 is the date of order u/s 154. Thus appellant has filed incorrect information. Appellant had filed rectification application before CPC u/s 154 on 08-05-2019, it obviously means the date of order u/s 143(1) is before 08-05-2019. In that case, this appeal which was filed on 22-06-2019 becomes belated appeal. However, in Form 35, appellant has mentioned that appeal filed in time which is factually incorrect. Thus there are factual wrong information in Form Number 35. Since the appeal is belated and no reason has been given for the delay, the delay is not condoned. To condone delay, there has to be a valid reason. But appellant has not provided any reason. On this ground also appeal is dismissed.’’ 5 ITA No.27/JP/2022 Shri Mehar Chand Gupta vs ITO, Alwar 5.2 During the course of hearing, the ld.AR of the assessee submitted that the ld. CIT(A)/NFAC, Delhi has dismissed the appeal of the assessee only on technical nature basis and not decided the appeal on merit for which the ld.AR of the assessee filed the following written submission. ‘’1. At the outset it is submitted that the assessee by mistake has incorrectly mentioned section 143(1) in column number 2(a) of Form No.35 as against section 143(1) r.w.s. 154. Accordingly he has not filed the copy of intimation u/s 143(1) but has filed the copy of intimation u/s 154 against which the present appeal is filed. The date of intimation u/s 154 is 15.06.2019 against which the assessee has filed the appeal on 22.06.2019. Thus, the appeal filed by the assessee is within time. Further no order number was mentioned in Form No.35 as the same was not mentioned in intimation u/s 154. Thus, various reasons given by the Ld. CIT(A) for dismissing the appeal filed by the assessee is only technical in nature and thereby not deciding the appeal on merit is bad in law. 2. Without prejudice to above, it is submitted that a legitimate claim of the assessee cannot be denied on technicalities as it is a settled proposition of law that technicalities should not come in way in imparting the substantial justice. Hon’ble Supreme Court in case of S. Nagaraj & Others Vs. State Of Karnataka & Another 4 SCC 595 in para 18 of the order has held as under:- “18. Justice is a virtue which transcends all barriers. Neither the rules of procedure nor technicalities of law can stand in its way. The order of the Court should not be prejudicial to anyone. Rule of stare decisis is adhered for consistency but it is not as inflexible in Administrative Law as in Public Law. Even the law bends before justice. Entire concept of writ jurisdiction exercised by the higher courts is founded on equity and fairness. If the Court finds that the order was passed under a mistake and it would not have exercised the jurisdiction but for the erroneous assumption which in fact did not exist and its perpetration shall result in miscarriage of justice then it cannot on any principle be precluded from rectifying the error. Mistake is accepted as valid reason to recall an order. Difference lies in the nature of mistake and scope of rectification, depending on if it is of fact or law. But the root from which the power flows is the anxiety to avoid injustice. It is either statutory or inherent. The latter is available where the mistake is of the Court. In Administrative Law the scope is still wider. Technicalities apart if the Court is satisfied of the injustice then it is its constitutional and legal obligation to set it right by recalling its order.” In view of above, Ld. CIT(A) ought to have decided the appeal on merit instead of adopting a hyper technical view and that too without any opportunity to counter the view which he has adopted. 3. On merits it is submitted that Form 26AS (Annexure 4) shows interest received from Ashu Mahawar at Rs.5,53,970/- and interest on FDR with PNB at Rs.7,246/-, totalling to Rs.5,61,216/-. Apart from this assessee in the return has shown interest from saving bank a/c at Rs.387 and interest on IT refund at Rs.3,020/-, totalling to Rs.5,64,623/-. Thus, AO(CPC) has incorrectly held that income from other sources as per Form 26AS is Rs.8,27,553/-, thereby making addition of Rs.2,62,930/- (8,27,553-5,64,623). Further in the intimation u/s 143(1) dt. 15.04.2019 (copy enclosed), AO has allowed the credit of TDS of Rs.56,122/- and self assessment 6 ITA No.27/JP/2022 Shri Mehar Chand Gupta vs ITO, Alwar tax of Rs.7,230/- whereas the same was not allowed in the intimation u/s 154 dt. 15.06.2019. The fact that tax of Rs.56,122/- was deducted from assessee’s income and assessee had paid self assessment tax of Rs.7,230/- is also verifiable from Form 26AS. The Hon’ble ITAT, Jaipur Bench in case of Shri Amit Mantri Vs. DCIT ITA No.151/JP/21 order dt. 04.01.2022 (copy enclosed) has held that where assessee has claimed the credit of TDS in the return which is also reflected in Form 26AS, the AO cannot refuse to grant credit of the same on technicalities. In view of above, AO be directed to delete the addition of Rs.2,62,930/- and allow the credit of TDS & self assessment tax as reflected in Form 26AS.’’ 5.3 On the other hand, the ld. DR supported the order of the ld. CIT(A), NFAC, Delhi. 5.4 We have heard both the parties and perused the materials available on record. Brief facts of the case are that the assessee filed the original return of income on 31-10-2017 which was revised on 31-05-2018 declaring total income of Rs. 6,67,550/-. A communication dated 21-08- 2018 by the DCIT, CPC, Bengalure was issued to the assessee with error description that income from other sources as per return of income is Rs. 5,64,623/- whereas as per Form 26AS other source of income is Rs.8,27,553/-. Hence, there is inconsistency of Rs.2,62,930/- between other source of income in return and Form 26AS. Thereafter, an intimation dated 15.04.2019 was issued u/s 143(1) of the Act by the department determining the total income at Rs.9,30,480/- (6,67,550+2,62,930). In that intimation credit of TDS of Rs.56,122/- and self assessment tax of Rs.7,230/- claimed by the assessee were granted and thus, the amount payable was determined at Rs.73,998/-. However, against the above intimation, the assessee filed a rectification request on 08.05.2019 which was rejected by the AO(CPC) vide rectification order u/s 154 dated 15.06.2019 by confirming addition of Rs.2,62,930/- under the head income from other sources and without allowing credit of TDS of Rs.56,122/- and self assessment tax of Rs.7,230/-, the amount payable was determined at Rs.1,54,208/-. The assessee filed appeal before Ld. CIT(A) against the said intimation u/s 154 dated 15.06.2019. The Ld. CIT(A), however, held that the assessee has not filed the copy of the order u/s 143(1) against which the assessee has filed the appeal. The assessee has also not mentioned the order number in Form No.35. In the absence of 7 ITA No.27/JP/2022 Shri Mehar Chand Gupta vs ITO, Alwar order u/s 143(1) against which this appeal has been filed, it is impossible to decide the appeal. Thus, the appeal is dismissed as not maintainable. The Ld. CIT(A) further held that the assessee has mentioned the date of order u/s 143(1) as 15.06.2019 in Form 35 but it is the date of order u/s 154 of the Act. Thus the assessee has filed incorrect information. The assessee has filed rectification application before CPC u/s 154 on 08.05.2019 which means that the date of order u/s 143(1) is before 08.05.2019. In that case, this appeal which was filed on 22.06.2019 becomes belated appeal. However, in Form 35, assessee has mentioned that appeal is filed in time which is factually incorrect. Since the appeal is belated and no reason has been given for the delay, the delay is not condoned. Thus, on this ground also the appeal was dismissed by the ld. CIT(A), NFAC. Taking into consideration the above facts and circumstances of the case, we find that the intimation u/s 143(1) is an intimation r.w.s. 154 of the Act and the the ld. CIT(A) should have decided the appeal on merit which is dated 15-06-2019 u/s 143(1) of the Act and in fact that matches in Form No. 35 also instead of technical latches. 5.5 From the available records before us, Form 26AS shows interest received from Ashu Mahawar at S.No.1 at Rs. 8,20,307 then at S.No.2 at Rs. 5,53,970 and negative figure of Rs. 8,20,307 at S.No.3. Thus, the effective interest as per that 26AS is Rs. 5,53,970/- only. Apart from this interest at Rs. 5,53,970/-, the assessee in the return has shown interest from saving bank account at Rs. 387/-, interest on FDR at Rs. 7,246/- and interest on IT refund at Rs.3,020/-, totalling to Rs.5,64,623/-. Thus, AO(CPC) has incorrectly held that income from other sources as per Form 26AS is Rs.8,27,553/-, thereby making addition of Rs.2,62,930/- (8,27,553-5,64,623). The ld.AR of the assessee has drawn our attention that income from Ashu Mahawar is effectively taxable at Rs. 5,53,970 only. As the entry in Form No. 26AS at Sr. No. 1 at Rs. 8,20,307/- of Ashu Mahawar is reduced or cancelled at Sr. No. 3 of the same 26AS and entry at Sr. No. 2 for 8 ITA No.27/JP/2022 Shri Mehar Chand Gupta vs ITO, Alwar Rs.5,53,970/- is taxable. Thus the action of the AO taxing differential amount at Rs2,62,930/- based from 26AS is uncalled for. The explained the disallowance as under:- Income from Ashu Mahawar at Sr. No. 1 Rs.8,20,307 Of First Table Part A Income from Punjab National Bank Rs. 7,246 A Rs.8,27,553 Income from other source in returned Income in both the intimation before B Rs. 5,64,623 154 application and after ----------------------------- Difference added Rs. 2,62,930 We find force in the contention of the ld.AR of the assessee and inclined to agree that the addition of Rs. 2,62,930/- is not required to be made basis on an entry which is subsequently changed / reduced. 5.6 Further in the intimation u/s 143(1) dated 15.04.2019, the AO has allowed the credit of TDS of Rs.56,122/- and self assessment tax of Rs.7,230/- whereas the same was not allowed in the intimation u/s 154 dated 15.06.2019. The fact is that tax of Rs.56,122/- was deducted from assessee’s income and assessee had paid self assessment tax of Rs.7,230/- which is also verifiable from Form 26AS. We also find that ITAT, Jaipur Bench in case of Shri Amit Mantri Vs. DCIT ITA No.151/JP/21 order dated 04.01.2022 has held that where assessee has claimed the credit of TDS in the return which is also reflected in Form 26AS, the AO cannot refuse to grant credit of the same on technicalities. In this view of the mater, AO is directed to delete the addition of Rs.2,62,930/- and allow the credit of TDS & self assessment tax as reflected in Form 26AS. Thus Ground No. 1 to 3 of the assessee are allowed. 6.1 Ground 4 of the assessee is regarding charging of interest u/s 234B and 234C of the Act, which is mandatory and consequential in nature. 9 ITA No.27/JP/2022 Shri Mehar Chand Gupta vs ITO, Alwar 7.1 Ground No. 5 of the assessee is regarding creating the demand of Rs.1,54,210/- within the meaning of Section 156 of the I.T. Act, 1961. Since the Ground Nos. 1 to 3 of the assessee are allowed, therefore, the AO is directed to allow credit of TDS after verification from Form 26AS. 8.0. In the result, the appeal of the assessee is allowed. Order pronounced in the open court on 08 /03/2022. Sd/- Sd/- ¼ Mk0 ,l- lhrky{eh ½ ¼ jkBksM deys'k t;UrHkkbZ ½ (Dr. S. Seethalakshmi) (Rathod Kamlesh Jayantbhai) U;kf;d lnL;@Judicial Member ys[kk lnL;@Accountant Member Tk;iqj@ Jaipur fnukad@Dated:- 08/03/2022 *Mishra vkns'k dh izfrfyfi vxzsf’kr@Copy of the order forwarded to: 1. The Appellant- Shri Mehar Chand Gupta, Alwar ,. 2. izR;FkhZ@ The Respondent- The ITO, Alwar . 3. vk;dj vk;qDr@ The ld CIT 4. vk;dj vk;qDr¼vihy½@The ld CIT(A) 5. foHkkxh; izfrfuf/k] vk;dj vihyh; vf/kdj.k] t;iqj@DR, ITAT, Jaipur 6. xkMZ QkbZy@ Guard File (ITA No. 27/JP/2022) vkns'kkuqlkj@ By order, lgk;d iathdkj@Asst. Registrar