M/S. Ashim Kar & Industries Pvt. Ltd., Kolkata V. DCIT, Circle - 10(1), Kolkata, Kolkata

ITA 523/KOL/2022

AI Insights

The case involves M/s Ashim Kar & Industries Pvt. Ltd., the appellant, contesting an order by the Commissioner of Income Tax (Appeals)-NFAC, Delhi, which upheld an addition of Rs. 6,20,890 to the assessee's income. This addition was initially made by the AO under section 143(1)(a) of the Income Tax Act, based on a Tax Audit Report that indicated non-deduction of TDS on certain expenses as required under section 40(a)(ia) of the Act. The assessee argued that the data provided in the return was incorrect due to a factual mistake by their CA, and sought an opportunity to rectify this before the AO. The Tribunal found merit in the assessee's contention and restored the matter to the AO for a detailed examination.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 127313 (ITAT-KOLKATA)
• Duration Of Justice: 3 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-01-2023
• Appeal Filed By: Assessee
• Order Result: PartlyAllowed
• Bench Allotted: B
• Next Hearing Date: 30-11-2022
• Assessment Year: 2020-2021
• Appeal Filed On: 13-09-2022
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Non-deduction of tax; TDS
• Section: 40(a)(ia)

Judgement Text

आयकर अपील य अ धकरण, कोलकाता पीठ ‘‘बी’’, कोलकाता IN THE INCOME TAX APPELLATE TRIBUNAL “B” BENCH: KOLKATA ी राजेश क ु मार, लेखा सद य एवं ी संजय शमा या यक सद यके सम [Before Shri Rajesh Kumar, Accountant Member & Shri Sonjoy Sarma, Judicial Member] I.T.A. No. 523/Kol/2022 Assessment Year: 2020-21 M/s Ashim Kar & Industries Pvt. Ltd. (PAN: AADCA 0819 R) Vs. DCIT, Circle-10(1), Kolkata Appellant / (अपीलाथ ) Respondent / ( !यथ ) Date of Hearing / स ु नवाई क$ त&थ 01.12.2022 Date of Pronouncement/ आदेश उ)घोषणा क$ त&थ 05.01.2023 For the Appellant/ नधा /रती क$ ओर से Shri Siddharth Jhajharia, A.R Shri Sujoy Sen, A.R For the Respondent/ राज व क$ ओर से Shri P.P. Barman, Addl. CIT ORDER / आदेश Per Rajesh Kumar, AM: This is the appeal preferred by the assessee against the order of the Ld. Commissioner of Income Tax (Appeals)-NFAC, Delhi (hereinafter referred to as the Ld. CIT(A)”] dated 26.08.2022 for the AY 2020-21. 2. The only issue raised by the assessee is against the order of Ld. CIT(A) upholding the order of ADIT, CPC (hereinafter referred to as the AO) thereby 2 I.T.A. No. 523/Kol/2022 Assessment Year: 2020-21 M/s Ashim Kar & Industries Pvt. Ltd. confirming the addition of Rs. 6,20,890/- on account of disallowance of expenses for non-deduction of tax u/s 40(a)(ia) of the Act. 3. Facts in brief are that the assessee filed the return of income on 10.02.2021 declaring total income of Rs. 1,91,97,000/- The return was processed u/s 143(1)(a) wherein the AO CPC has made an addition of Rs. 6,20,890/- which was stated to be on account of expenses u/s 40(a)(ia) of the Act on which TDS liable to be deducted was not deducted. The AO CPC noted this from the information furnished by the auditors of the assessee in the Tax Audit Report. 4. The assessee assailed the order of AO CPC before the Ld. CIT(A). The Ld. CIT(A) simply dismissed the appeal on the ground that the addition has resulted from wrong data furnished by the assessee in the return of income and the AO has computed the income on the basis of that data and therefore there is no mistake in the order of AO. The Ld. CIT(A) held that the correct remedy was to file the revised return against the order AO CPC when the order is erroneous and the appellate forum is not a platform to provide another opportunity to assessee to rectify its own mistakes. Thus the appeal of the assessee is dismissed. 5. After hearing the rival contentions and perusing the material on record, we observe that the assessee’s CA has furnished wrong data in ITR relating deduction to tax which the AO has added in the summary intimation passed u/s 143(1)(a)of the Act dated 18.12.2019 disallowing the expenses of Rs. 6,20,890/- for non-deduction of tax u/s 40(a)(ia) of the Act. The assessee submitted before us that this is a factual mistake by the ld. Counsel by uploading the wrong data while filing the return which has resulted into this addition which is not called for and is incorrect. Therefore the assessee may kindly be given one more opportunity to present its case before the AO so that the issue can be verified and decided on correct facts accordingly. The order of Ld. CIT(A) simply stated that the mistake is only on the part of the assessee and that the AO passed intimation u/s 143(1)(a) of the Act based upon the information/details furnished by the assessee which appears to be very harsh and 3 I.T.A. No. 523/Kol/2022 Assessment Year: 2020-21 M/s Ashim Kar & Industries Pvt. Ltd. draconian as the mistake is factual which needs to be corrected. Accordingly we deem it fit to restore the file of the AO and direct him to look into the matter and decide the issue in accordance with law after affording a reasonable opportunity of hearing to the assessee. 6. In the result, the appeal of the assessee is allowed for statistical purposes. Order is pronounced in the open court on 5 th January, 2023 Sd/- Sd/- (Sonjoy Sarma /संजय शमा ) (Rajesh Kumar/राजेश क ु मार) Judicial Member/ या यक सद य Accountant Member/लेखा सद य Dated: 5 th January, 2023 SB, Sr. PS Copy of the order forwarded to: 1. Appellant- M/s Ashim Kar & Industries Pvt. Ltd. , C/o, M/s Salarpuria Jajodia & Co., 7, C.R. Avenue, 3 rd Floor, Kolkata-700072. 2. Respondent – DCIT, Circle-10(1), Kolkata 3. Ld. CIT(A)-NFAC, Delhi 4. Pr. CIT- , Kolkata 5. DR, Kolkata Benches, Kolkata (sent through e-mail) True Copy By Order Assistant Registrar ITAT, Kolkata Benches, Kolkata