SHALIMAR CHEMICAL WORKS(P)Ltd, Kolkata V. Centralised Processing Centre, Bangalore

ITA 333/KOL/2023

AI Insights

The case involves Shalimar Chemical Works Private Limited, which appealed against the decision of the CIT(A) that upheld the AO's denial of credit for dividend distribution tax (DDT) paid. The DDT of Rs. 20,50,960 was paid by the company on dividends declared for the assessment year 2015-16, within the required 14 days as per section 115O(1) of the Income Tax Act. However, the AO denied the credit, claiming the tax pertained to the next assessment year, which the CIT(A) upheld. The Tribunal, after reviewing the Form 26AS and the Income Tax Return filed by the assessee, concluded that the DDT was indeed paid for the correct assessment year and directed the AO to allow the credit as claimed by the assessee.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 122989 (ITAT-KOLKATA)
• Duration Of Justice: 2 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-06-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 31-05-2023
• Assessment Year: 2015-2016
• Appeal Filed On: 09-04-2023
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: SOMNATH BANERJEE
• Keywords: Set aside; FORM 26AS
• Section: 143(1)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA BENCH “C”, KOLKATA BEFORE SHRI RAJESH KUMAR, HON’BLE ACCOUNTANT MEMBER AND SHRI SONJOY SARMA, HON’BLE JUDICIAL MEMBER ITA No. 333/Kol/2023 Assessment Year: 2015-16 Shalimar Chemical Works Private Limited 92E, Alipore Road, Kolkata- 700027. PAN: AAECS 7442 K Vs. CPC, Bangalore (Appellant) (Respondent) Present for: Appellant by : Shri Somnath Banerjee, AR Respondent by : Shri Vijay Kumar, Addl. CIT, Dr. DR Date of Hearing : 01.06.2023 Date of Pronouncement : 12.06.2023 O R D E R PER RAJESH KUMAR, AM: This appeal of the assessee for the assessment year 2015-16 is directed against the order dated 02.03.2023 passed by the ld. Commissioner of Income-tax Appeals, NFAC, Delhi [hereinafter referred to as ‘the ld. CIT(A)’]. 2. The only common issue raised in grounds of appeal is against the order of ld. CIT(A) upholding the order of AO wherein the AO has held that the assessee was not entitled to claim the credit of the dividend distribution tax paid of Rs. 20,50,960/- as per the provision u/s 115O(1)/115O(5) of the Act. 3. The facts in brief are that the assessee filed its return of income on 24.11.2015 which was processed u/s 143(1) of the Act wherein the assessee was denied the credit of Rs. 20,50,960/- paid as dividend distribution tax vide BSR Code 0510075 and Challan ITA No.333/Kol/2023 Shalimar Chemical Works (P) Ltd. A.Y. 2015-16 2 No. 10193 against dividend distribution tax payable of Rs. 20,14,000/-. The assessee has declared of Rs. 1,00,72,962/- as dividend in the annual general meeting 14.10.2015 on which Rs. 20,14,000/- was payable as dividend distribution tax which was paid as such. The AO CPC, did not give credit of dividend distribution tax of Rs. 20,50,960/- without giving any opportunity to assessee. The assessee has declared dividend on 14.10.2015 in 70 th Annual General Meeting and accordingly paid dividend of Rs. 1,00,72,962/- on 19.10.2015 on which tax was also deposited on 28.10.2015 amounting to Rs. 20,50,960/- which duly appeared in Form 26AS. 4. The assessee has challenged the order passed u/s 143(1) of the Act by ITO, CPC but same was dismissed by ld. CIT(A) by holding that Rs. 20,50,960/- was not allowable since the same did not belong to the instant assessment year and therefore, upheld the order of the AO CPC. 5. After hearing the rival contentions and after perusing the material available on record, we observe that the assessee has declared the dividend on 14.10.2015 for A.Y. 2015-16 amounting to Rs. 1,00,72,962/- which was paid on 19.10.2015 and accordingly paid dividend distribution tax of Rs. 20,50,960/- on 28.10.2015 within 14 days in terms of provisions of section 115O(1) of the Act. According to the authorities below, the tax was paid for the next assessment year. In view of the entry in Form 26AS and ITR filed by the assessee, we observe that the DDT was paid on the dividend declared by the assessee in respect of A.Y. 2015-16 in the Annual General Meeting. We also note that the said amount of Rs. 20,50,960/- was never given credit in the subsequent years. Under ITA No.333/Kol/2023 Shalimar Chemical Works (P) Ltd. A.Y. 2015-16 3 these circumstances, we are of the considered view that the assessee has complied with the provisions of section 115O(1) of the Act and deposited the same within 14 days after declaration of dividend and duly claimed in the return of income. Therefore, the assessee cannot be punished for any technical and flimsy reasons and considering the facts and circumstances of the case we are inclined to set aside the order of ld. CIT(A) and direct the AO to allow the credit of Rs. 20,50,960/- as claimed by the assessee. 6. In the result, the appeal of the assessee is allowed. Order pronounced in the open court on 12.06.2023 Sd/- Sd/- [Sd/- (SONJOY SARMA) (RAJESH KUMAR) JUDICIAL MEMBER ACCOUNTANT MEMBER Kolkata, Dated:12.06.2023 Biswajit, Sr. P.S. Copy to: 1. The Appellant: Shalimar Chemical Works (P) Ltd. 2. The Respondent: CPC, Bangalore. 3. The CIT, 4. The CIT (A) 5. The DR //True Copy// [ By Order Assistant Registrar ITAT, Kolkata Benches, Kolkata