SHRI AMIT PRAKASH MEHTA, MUMBAI V. DEPUTY COMM. OF INCOME TAX, CPC, MUMBAI

ITA 2960/MUM/2022

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Shri Amit Prakash Mehta appealed against the order of the National Faceless Appeal Centre (NFAC), which confirmed the Assessing Officer's decision of not allowing the TDS credit for the assessment year 2017-18. The TDS was deducted by his employer but not remitted to the Central Government. The Tribunal examined the documents provided by the assessee, including the computation of total income, the statement of full and final settlement from his employer, and the form 26AS showing the TDS deductions. The Tribunal noted that the employer had indeed deducted the TDS and that the assessee had declared the corresponding income. The Tribunal's decision was influenced by a previous ruling in the assessee's favor for the assessment year 2016-17 and relevant CBDT circulars.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 301093 (ITAT-MUMBAI)
• Duration Of Justice: 1 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-01-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 09-01-2023
• Assessment Year: 2017-2018
• Appeal Filed On: 20-11-2022
• Other Referred Cases: Yashpal Sahni vs. ACIT (2007) 293 ITR 539
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: TDS; Set aside; FORM 26AS
• Section: 205

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH “A”, MUMBAI BEFORE SHRI KULDIP SINGH, JUDICIAL MEMBER AND SHRI S. RIFAUR RAHMAN, ACCOUNTANT MEMBER ITA No.2960/M/2022 Assessment Year: 2017-18 Shri Amit Prakash Mehta, 9, Akashdeep, Dungarshi Road, Walkeshwar, Mumbai – 400 006 PAN: AFNPM7986D Vs. Deputy Commissioner of Income Tax, Centralized Processing Centre, Bangalore – 560100 (Appellant) (Respondent) Present for: Assessee by : Shri Mahesh O. Rajora, A.R. Revenue by : Shri Manoj Kumar Sinha, D.R. Date of Hearing : 10 . 01 . 2023 Date of Pronouncement : 19 . 01 . 2023 O R D E R Per : Kuldip Singh, Judicial Member: The appellant, Shri Amit Prakash Mehta (hereinafter referred to as ‘the assessee’) by filing the present appeal, sought to set aside the impugned order dated 26.10.2022 passed by the National Faceless Appeal Centre(NFAC) [Commissioner of Income Tax (Appeals), Delhi] (hereinafter referred to as CIT(A)] qua the assessment year 2017-18 on the grounds inter-alia that :- “1(a). The Hon'ble Commissioner of Income Tax (Appeal), National Faceless Appeal Centre (NFAC), Delhi (hereinafter referred as "CIT(A)"] erred in confirming the action of AO in not allowing the TDS credit being TDS deducted but not paid to the credit of Central Government by the employer. ITA No.2960/M/2022 Shri Amit Prakash Mehta 2 The Appellant submits that he has offered the corresponding income for taxation from which TDS has been deducted by the employer for the year under consideration; hence, he shall be allowed to claim the TDS credit in the subjected year. The Appellant also submits that he shall not be forced to make the payment of TDS which has already been deducted by the employer but not paid to the credit of Central Government. 1(b). The Hon'ble CIT(A) erred in confirming the action of AO in ignoring the CBDT Office Memorandum dated 11/03/2016 bearing number F.No 275/29/2014-IT (B) and instruction letter dated 01.06.2015 issued by the Hon'ble CBDT. The Appellant craved leave to add, amend and modify the above ground of appeal.” 2. Briefly stated facts necessary for consideration and adjudication of the issues at hand are: the assessee is an individual tax payer, filed the return of income for the year under consideration declaring the total income of Rs.32,26,348/- by determining the tax liability at Rs.9,27,125/- which has been paid as TDS to the tune of Rs.2,17,710/- and self assessment tax of Rs.7,07,420/-. While processing his return of income under section 143(1) of the Income Tax Act,1961 (for short ‘the Act’) his liability of Rs.1,42,605/- was determined. 3. The assessee carried the matter before the Ld. CIT(A) by way of filing appeal who has confirmed the addition by dismissing the appeal. Feeling aggrieved with the impugned order passed by the Ld. CIT(A) the assessee has come up before the Tribunal by way of filing present appeal. 4. We have heard the Ld. Authorised Representatives of the parties to the appeal, perused the orders passed by the Ld. Lower Revenue Authorities and documents available on record in the light ITA No.2960/M/2022 Shri Amit Prakash Mehta 3 of the facts and circumstances of the case and law applicable thereto. 5. Undisputedly the assessee has drawn salary of Rs.10,05,021/- from its employer M/s. Shrunej & Co. Ltd. It is also not in dispute that during the first appellate proceedings the assessee has uploaded his submission on 24.08.2021 along with documents viz. computation of total income for A.Y. 2017-18, statement of full and final settlement for A.Y 2017-18 by employer namely M/s. Shrunej & Co. Ltd., form 26AS for A.Y. 2017-18. It is also not in dispute that the assessee has self determined its tax assessment at Rs.7,07,420/- and claimed that a TDS of Rs.2,19,710/- has been paid by his employer. The Ld. CIT(A) has dismissed the appeal on the sole ground that the assessee has failed to prove that the TDS amount has been deducted as alleged. 6. The assessee has also brought on record computation of total income, statement of full and final settlement issued by his employer, form 26AS statement showing the month-wise TDS deducted from the salary along with salary slip, all for the year under consideration available in the paper book from page 1 to 9 of the paper book. When we examine the computations of income, statement of full and final settlement issued by assessee’s employer, form 26AS showing deduction of tax from his salary and statement showing month-wise TDS deduction, all these documents show that the assessee’s employer has deposited TDS of Rs.2,17,710/- and assessee paid self assessment tax of Rs.7,07,420/-, total amounting to Rs.9,27,125/- by declaring income of Rs.32,26,348/-. ITA No.2960/M/2022 Shri Amit Prakash Mehta 4 7. Similar issue had arisen in case of the assessee in the earlier year i.e. for A.Y. 2016-17 wherein co-ordinate Bench of the Tribunal by relying upon CBDT circular dated 11.03.2016 bearing F.No.275/29/2014-IT(B) and decision rendered by Hon’ble Bombay High Court in case of Yashpal Sahni vs. ACIT (2007) 293 ITR 539 reached the conclusion that the Revenue Department cannot deny the benefit of tax deducted at source (TDS) by the employer of the assessee and credit thereof would be given to the assessee for the respective years. If there has been any recovery or adjustment within the refunds of the later years the same shall be returned to the petitioner with statutory interest. 8. Once it is proved on file that the TDS as claimed by the assessee have been deducted by his employer its credit cannot be denied to the assessee rather its defaulter is to be penalized under section 221 of the Act. Even under section 205 of the Act tax deducted at source cannot be demanded from the assessee having been already deducted from his salary by his employer. So if the tax has been deducted but not paid to the government it cannot be collected again from the assessee who has already suffered deductions, because in the Income Tax Act scheme inbuilt mechanism has been made to take care of such eventualities. 9. In view of what has been discussed above and following the order passed by the co-ordinate Bench of the Tribunal in assessee’s own case for A.Y. 2016-17 ITA No.2144/M/2022 date of order 30.09.2022, we are of the considered view that the Ld. CIT(A) has erred in denying the relief sought for by the assessee who is entitled ITA No.2960/M/2022 Shri Amit Prakash Mehta 5 for credit of TDS deducted by his employer and the Revenue is not entitled to recover the same from the assessee. 10. Resultantly, appeal filed by the assessee is allowed. Order pronounced in the open court on 19.01.2023. Sd/- Sd/- (S. RIFAUR RAHMAN) (KULDIP SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER Mumbai, Dated: 19.01.2023. * Kishore, Sr. P.S. Copy to: The Appellant The Respondent The CIT, Concerned, Mumbai The CIT (A) Concerned, Mumbai The DR Concerned Bench //True Copy// By Order Dy/Asstt. Registrar, ITAT, Mumbai.