Jajodia Finance Ltd. , Kolkata V. Ld. ITO,Ward-9(3), kolkata, Kolkata

ITA 621/KOL/2023

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Jajodia Finance Limited appealed against the order of the Commissioner of Income Tax (Appeals) which upheld the addition of Rs. 16,37,260 as unaccounted income due to a mismatch in TDS reported in the income tax return and Form 26AS. The assessee argued that the TDS from M/s. Pooja Construction, which was not deposited by the time of filing the return, was subsequently deposited and included in the income of the following financial year. The Tribunal agreed with the assessee's position, noting that the TDS was eventually deposited and accounted for in the subsequent financial year, thus not constituting unaccounted income for AY 2015-16.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 128750 (ITAT-KOLKATA)
• Duration Of Justice: 2 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-09-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 31-07-2023
• Assessment Year: 2015-2016
• Appeal Filed On: 21-06-2023
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Income from undisclosed sources; Additional evidence; TDS; Set aside; FORM 26AS
• Section: 143(3); 250

Judgement Text

आयकर अपीलीय अधिकरण कोलकाता 'एसएमसी' पीठ, कोलकाता म ें IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA ‘SMC’ BENCH, KOLKATA श्री संजय गग ग , न्याधयक सदस्य एवं डॉ. मनीष बोरड, ल े खा सदस्य क े समक्ष Before SRI SANJAY GARG, JUDICIAL MEMBER & DR. MANISH BORAD, ACCOUNTANT MEMBER I.T.A. No.: 621/KOL/2023 Assessment Year: 2015-16 Jajodia Finance Limited..........................................Appellant [PAN: AAACJ 8457 D] Vs. ITO, Ward-9(3) Kolkata.........................................Respondent Appearances: Assessee represented by: Sh. Miraj D. Shah, A/R. Department represented by: Sh. Gautam Patra, Addl. CIT. Date of concluding the hearing : August 1 st , 2023 Date of pronouncing the order : September 8 th , 2023 ORDER Per Manish Borad, Accountant Member: This appeal filed by the assessee pertaining to the Assessment Year (in short ‘AY’) 2015-16 is directed against the order passed u/s 250 of the Income Tax Act, 1961 (in short the ‘Act’) by ld. Commissioner of Income-tax (Appeals)-3, Lucknow [in I.T.A. No.: 621/KOL/2023 Assessment Year: 2015-16 Jajodia Finance Limited. Page 2 of 5 short ld. ‘CIT(A)’] dated 01.05.2023 arising out of the assessment order framed u/s 143(3) of the Act dated 29.12.2017. 2. The assessee is in appeal before the Tribunal raising the following grounds: “1. For that in the facts and circumstances of the case the Appellate order passed was without jurisdiction and also in violation of principals of natural justice hence is bad in law and be quashed. 2. For that in the facts and circumstances of the case the Appellate order passed was without providing proper opportunity of hearing to the assessee. The appellate order should be set aside as the same is bad in law. 3. For that in the facts and circumstance of the case Ld. Commissioner of Income Tax Appeals erred in upholding and confirming the addition of Rs. 16,37,260 on account of unaccounted income due to mismatch in TDS as claimed in return of Income and TDS as per Form No.26AS. The addition is not called for hence the same be deleted. 4. The appellant craves leave to produce additional evidences in terms of Rule 29 of the Income Tax (Appellate Tribunal) Rules 1963. 5. For that the facts and circumstances of the case the interest computed u/s 234 A/B/C/D of the IT Act 1961 is over charged and wrongly calculated and or is not applicable to the assessee case hence the interest be deleted and or correctly computed. 6. The appellant craves leave to press new, additional grounds of appeal or modify, withdraw any of the above grounds at the time of hearing of the appeal.” 3. The effective issue raised in the instant appeal by the assessee is that ld. CIT(A) erred in upholding and confirming the addition of Rs. 16,37,260/- on account of unaccounted income due to mismatch in TDS as claimed in return of income and TDS as per Form 26AS. 4. The facts in brief are that the assessee is a limited company. Income of Rs. ‘NIL’ declared in the e-return for AY 2015-16 filed on I.T.A. No.: 621/KOL/2023 Assessment Year: 2015-16 Jajodia Finance Limited. Page 3 of 5 30.10.2015 claiming refund of Rs. 16,96,600/-. Subsequent to the case, being selected for scrutiny through CASS and followed by serving of valid notices, ld. AO during the course of assessment proceedings observed that tax credit claimed in income tax return is less than the tax credit available in Form 26AS. Ld. AO observed that TDS disclosed in ITR is Rs. 17,20,839/- but as per Form 26AS TDS is Rs. 18,84,565/- and there is difference of TDS of Rs. 1,63,726/- and since TDS is deducted @ 10% ld. AO came to a conclusion that the assessee has not disclosed income of Rs. 16,37,260/- in the income tax return and made the addition thereof. 5. The assessee challenged the said addition before ld. CIT(A) but failed to succeed. 6. Aggrieved, the assessee is now in appeal before this Tribunal. Ld. Counsel for the assessee submitted that there is an interest income received from M/s. Pooja Construction but before the date of filing the return on 30.10.2015, the TDS deducted by M/s. Pooja Construction was not deposited and thus, not appearing in Form 26AS. It was subsequently deposited on 25.11.2015. The said TDS which was deposited by M/s. Pooja Construction has been included by the assessee in the interest income in subsequent financial year and therefore, it is not a case of unaccounted interest income. 7. On the other hand, ld. D/R vehemently argued supporting the orders of both the lower authorities. I.T.A. No.: 621/KOL/2023 Assessment Year: 2015-16 Jajodia Finance Limited. Page 4 of 5 8. We have heard rival contentions and perused the records placed before us. The addition of unaccounted interest income based on variation in TDS claimed in the return and TDS appearing in Form 26AS is in challenge before us. We notice that in the income tax return for AY 2015-16 the TDS claimed is at Rs. 17,20,839/- but as per Form 26AS the said sum is Rs. 18,84,565/- . The difference of Rs. 1,63,726/- of the TDS amount has been taken as a basis by ld. AO to make the impugned addition of unaccounted interest income. 9. We observe that during the FY 2014-15 the assessee has received interest from various parties including Rs. 15,11,093/- from M/s. Pooja Construction (Proprietor Vasudev Lilaram Bhagnani). In the details of interest and TDS deducted against each party from which interest has been received, no TDS is shown against M/s. Pooja Construction. The reason for the same is that up to the date of filing the income tax return on 30.10.2015, M/s. Pooja Construction has not deposited the TDS deducted by it which amounted to Rs. 16,37,260/-. Thereafter when the assessee came to know that M/s. Pooja Construction has deposited the deducted TDS, rather than revising its return for AY 2015-16, included the TDS sum of Rs. 1,63,726/- in the income for AY 2015- 16 and offered it to tax. All these facts are verifiable from the records placed before us which clearly indicates that it is not a case of unaccounted interest income, but it is a case where TDS deducted by a party but not deposited has given rise to the said difference and subsequently, when the TDS deducted has been deposited by the payer party, the assessee has included the same in the income of subsequent FY 2015-16. Under these given facts I.T.A. No.: 621/KOL/2023 Assessment Year: 2015-16 Jajodia Finance Limited. Page 5 of 5 and circumstances, we set aside the finding of ld. CIT(A) and delete the addition of Rs. 16,37,260/- and allow the effective ground no. 3 raised by the assessee. 10. Other grounds being general and consequential in nature need no adjudication. 11. In the result, the appeal filed by the assessee is allowed. Kolkata, the 8 th September, 2023 Sd/- Sd/- [Sanjay Garg] [Manish Borad] Judicial Member Accountant Member Dated: 08.09.2023 Bidhan (P.S.) Copy of the order forwarded to: 1. Jajodia Finance Limited, 20, Mullick Street, 4 th Floor, Kolkata-700 007. 2. ITO, Ward-9(3) Kolkata. 3. CIT(A)-3, Lucknow. 4. CIT- 5. CIT(DR), Kolkata Benches, Kolkata. //True copy // By order Assistant Registrar ITAT, Kolkata Benches Kolkata