Shyamala Navlaha, Mumbai V. ITO Ward 30(2), Delhi

ITA 548/DEL/2023

• Counselvise Citation: [2023] 101 COUNSELVISE.COM (IT) 9349 (ITAT-DELHI)
• Duration Of Justice: 9 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-12-2023
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: G
• Next Hearing Date: 20-12-2023
• Assessment Year: 2018-2019
• Appeal Filed On: 27-02-2023
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: TDS
• Section: 143(1)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH, ‘G’: NEW DELHI BEFORE SHRI SHAMIM YAHYA, ACCOUNTANT MEMBER AND SHRI CHALLA NAGENDRA PRASAD, JUDICIAL MEMBER ITA No.548/DEL/2023 [Assessment Year: 2018-19] Shyamala Navlakha, C/o-Kushal Navlakha, 701, Meghdoot-B, Lokhandwala Creekt Road, Andheri (W), Mumbai, Maharashtra-400053 Vs ITO, Ward-30(2), Delhi PAN-AAEPN3391F Assessee Revenue Assessee by Sh. Girish Gupta, CA Revenue by Sh. Anuj Garg, Sr. DR Date of Hearing 21.12.2023 Date of Pronouncement 27.12.2023 ORDER PER SHAMIM YAHYA, AM, This appeal by the assessee is directed against the order of the National Faceless Appeal Centre/Ld. Commissioner of Income Tax (Appeals), New Delhi dated 03.01.2023 for the assessment year 2018-19. 2. The grounds of appeal raised by the assessee reads as under:- 1. That the Ld. CIT (A) has grievously erred in law and on facts in upholding that the claim of TDS by the Assessee has been rightly disallowed by the DCIT (CPC) Bengaluru. 2. That the Ld. CIT (A) has grievously erred in law and on facts in not appreciating the contentions of the Appellant that based on the various judicial precedents 2 ITA No.548/Del/2023 and other documents, she can be rightly allowed the credit of TDS not deposited by the deductor. 3. That the Ld. CIT (A) has grievously erred in law and on facts in holding that no judicial decisions allow credit of unpaid amount in Government exchequer 4. That disallowing credit of TDS u/s 143(1) is a debatable issue and is beyond jurisdiction of the intimation passed u/s 143(1) of the Act and therefore credit may be directed to be allowed. 5. That the Ld. CIT (A) has grievously erred in law and on facts in not passing speaking order while rejecting the submissions of the Assessee. 6. The Appellant craves leave to add, alter, amend, vary and/or withdraw any or all of the above grounds of Appeal.” 3. Brief facts of the case are that the assessee is an individual and showing income from house property and income from other sources. The assessee has shown the rental income in the return of income and claimed the benefit of TDS worth Rs.1,21,800/-, deducted by the tenant. The tenant Mr. Rajeev Dhingra has not deposited the amount of Rs.1,21,800/- in the Government Account. The Assessing Officer, CPC has hence made the adjustment of the unpaid TDS amount of Rs.1,21,800/-. 4. Against the above order, the assessee appealed before the Ld. CIT(A). 5. The Ld. CIT(A) considered the submission but rejected the same and the assessee’s appeal was dismissed. 6. Against this order, the assessee has filed appeal before us. 3 ITA No.548/Del/2023 7. We have heard both the parties and perused the records. The Ld. Counsel for the assessee contended that this Tribunal in the case of co- owner of the same property has passed an order which may kindly be followed. 8. Per Contra, the Ld. DR did not dispute this proposition. 9. We find that this Tribunal in the case of Kushal Navlakha in ITA No.1663/Del/2020, dated 17.07.2023, co-owner of the same property on similar circumstances has passed the order. The relevant part of the aforesaid order is reproduced hereunder for ready reference:- “This appeal by the assessee is preferred against the order of the CIT(A)-10, New Delhi dated 04.08.2020 pertaining to A.Y. 2018-19. 2. The grievance of the assessee read as under:- 1. That in facts and circumstances of the case, the order passed u/s. 250(6) of the Act by the Ld. CIT(A)-10 against the Assessee holding that the claim of TDS by the Assessee has been rightly disallowed by the DCIT (CPC) Bengaluru, is wrong, passed without following due process of law and in thus void ab initio, which needs to be struck down. 2. That in facts and circumstances of the case, the Ld. CIT(A) has wrongly held that the Assessee should follow up with the deductor and persuade the tax deducted at source to enable the Assessee to get the credit of tax deducted as this is illogical, without any sanctity of law and thus the disallowance of tax deducted, needs to be struck down. 3. That in facts and circumstances of the case, the Ld. CIT(A) has wrongly held that the Assessee has merely made assertions and does not have any corroborating document or any supporting evidences available with the Assessee to prove that the tenant of the Assessee deducted tax at source out of rent payments made to the Assessee as this is completely wrong and incorrect and thus the order of the CIT(A) needs to be struck down. Rs.52,200/- 4. That in facts and in circumstances of the case the order of the CIT(A), by holding that, both, deduction of tax and subsequent deposit of such tax by the deductor are mandatory to give the credit of tax to the deductee, is bad in law, incorrect and arbitrary and thus the disallowance needs to be struck down. 5. That in facts and in circumstances of the order of Ld. CIT(A) is unjust, incorrect and arbitrary as he has not followed the provisions of 4 ITA No.548/Del/2023 the Act and not followed various judicial precedents of various higher courts in true letter and spirit which are in favour of the Assessee and thus the order of the Ld. CIT(A) needs to be struck down. 6. That in facts and circumstances of the case the order of the Ld. CIT(A) is incorrect, unjust and bad in law as the disallowance of TDS is a debatable issue and the same cannot be disallowed in order u/s. 143(1) of the Act and thus the disallowance needs to be struck down. 7. The appellant craves leave to add, alter amend, vary, and/ or withdraw any or all of the above grounds of Appeal.” 3. The sum and substance of the grievance of the assessee is that because the TDS deducted by the tenant amounting to Rs.52200/- was not deposited in the Government account the AO erred in recovering the amount from the assessee. 4. Briefly stated the facts of the case are that the assessee has let out its property to Mr. Rajeev Dhingra at a gross rent per month of Rs.43500/- totaling to Rs.522000/-on which Mr. Dhingra deducted tax at source @ 10% amounting to Rs.52200/-. It is an undisputed fact that Mr. Dhingra did not deposit this amount in the Government account and, therefore, the credit for TDS was denied by the AO. 5. On such facts we cannot direct the AO to give the credit of TDS the appeal of the assessee has to be dismissed. 6. However, in the interest of justice it would not be out of place to quote following CBDT circular :- 5 ITA No.548/Del/2023 7. In the light of the aforementioned CBDT circular, though we have dismissed the appeal of the assessee, yet we direct the AO not to take any recovery action for the outstanding tax liability keeping in mind the mandate of aforestated CBDT circular. With these directions the appeal is dismissed.” 10. Respectfully following the precedent as above, we hold that we cannot direct he AO to give the credit of TDS and the appeal of the assessee has to be dismissed. However as referred to in above said order, in the light of the CBDT Circular, we direct the AO not to take any recovery action for the outstanding tax liability keeping in mind the mandate of aforesaid CBDT Circulars as noted in the aforesaid decision of the Tribunal. With these directions, the appeal of the assessee is dismissed. 11. In the result, the appeal of the assessee is dismissed. Order pronounced in the open court on 27 th December, 2023. Sd/- Sd/- [CHALLA NAGENDRA PRASAD] [SHAMIM YAHYA] JUDICIAL MEMBER ACCOUNTANT MEMBER Delhi; 27.12.2023. f{x~{tÜ? f{x~{tÜ?f{x~{tÜ? f{x~{tÜ? Copy forwarded to: 1. Assessee 2. Respondent 3. CIT 4. CIT(A) 5. DR Asst. Registrar, ITAT, New Delhi