SATPAL, PROPRIETOR M/S JIALAL SATPAL,KAITHAL V. INCOME TAX OFFICER, WARD, KAITHAL

ITA 1159/CHANDI/2025

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The case involves Shri Satpal, a commission agent (Kachha Arhtia), who appealed against the order of the CIT(A) which upheld the CPC's decision to allow only a partial TDS credit for the Assessment Year 2022-23. The CPC had allowed a TDS credit of Rs. 52,162 against Rs. 5,34,892 claimed by the assessee, based on discrepancies between the assessee's reported receipts and those reflected in Form 26AS. The Tribunal considered the nature of the assessee's business, where he acts as an intermediary between farmers and traders, and only the commission income should be considered for TDS deductions. The Tribunal's decision emphasized that the TDS deducted on transactions not directly involving the assessee's revenue should still be credited to the assessee.

• Counselvise Citation: [2026] 140 COUNSELVISE.COM (IT) 827042 (ITAT-CHANDIGARH)
• Duration Of Justice: 3 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-01-2026
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2022-2023
• Appeal Filed On: 09-09-2025
• Laws Referred To: Income Tax Act, Rule 37BA, CBDT Circular No.452
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RANJIT KAUR LD. VIRTUAL
• Assessee Lawyers: PRANAV JAIN; AVNEET SINGH
• Keywords: Business income; TDS; Rectification of order; FORM 26AS
• Section: 154

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL “SMC” BENCH, CHANDIGARH VIRTUAL HEARING HON’BLE SHRI MANOJ KUMAR AGGARWAL, AM आयकरअपीलसं. / ITA No.1159/CHANDI/2025 (िनधाŊरणवषŊ / Assessment Year: 2022-23) Shri Satpal (Prop. M/s Jialal Satpal Nai Anaj Mandi, Jind Road, Kaithal Haryana - 136027 बनाम/ Vs. ITO Ward - Kaithal Kaithal (Haryana) ̾थायीलेखासं./जीआइआरसं./PAN/GIR No. ACHPP-9708-R (अपीलाथŎ/Appellant) : (ŮȑथŎ / Respondent) अपीलाथŎकीओरसे/ Appellant by : Sh. Pranav Jain & Sh. Avneet Singh (Advocate) – Ld. ARs (Virtual) ŮȑथŎकीओरसे/Respondent by : Dr. Ranjit Kaur (Addl. CIT) – Ld. Sr. DR (Virtual) सुनवाईकीतारीख/Date of Hearing : 07-01-2026 घोषणाकीतारीख /Date of Pronouncement : 07-01-2026 आदेश / O R D E R 1. Aforesaid appeal by assessee for Assessment Year (AY) 2022- 23 arises out of an order of learned Addl. / Joint Commissioner of Income Tax (Appeals), NFAC [CIT(A)] dated 14-07-2025 in the matter of a rectification intimation issued by CPC u/s 154 of the Act on 26-09- 2024. The sole grievance of the assessee is allowance of TDS credit. Having heard rival submissions and upon perusal of case records, the appeal is disposed-off as under. 2. Upon perusal of rectification order dated 26-09-2024, it could be seen that CPC allowed TDS credit of Rs.52,162/- as against Printed from counselvise.com Rs.5,34,892/- as claimed by the assessee. The same was on the ground that in terms of Rule 37BA, total receipts as offered by the assessee to tax was less than receipts as reflected in Form 26AS by various deductor while deducting TDS on various transactions with the assessee. During first appeal, it was explained by the assessee that it acted as Kachha Arhtia (Commission agent) in his proprietorship concern and the assessee was providing services to farmers for sale of their crops to traders etc. The payment so received is transferred to farmers against commission. The assessee is not the owner of the goods but merely acted as commission agent on behalf of the farmers. As per CBDT Circular No.452 dated 17-03-1986, only commission income would constitute business receipts of the assessee. However, Ld. CIT(A) rejected the said claim and upheld the action of CPC in terms of Rule 37BA (2). Aggrieved, the assessee is in further appeal before us. 3. From assessee’s pleadings, it could be seen that the assessee has acted as Kaccha Arhtia only. The assessee receives payment from traders on behalf of the farmers against commission income. The commission receipts become the income of the assessee. However, few of the traders have deducted TDS u/s 194Q against gross receipts which are not the receipts for the assessee. These receipts would never be offered as revenue receipts. Nevertheless, TDS has been deducted against assessee’s payment and it is the assessee’s money which has been deducted by the traders. Therefore, the credit of the same would certainly be available to the assessee. The turnover or Printed from counselvise.com other financial results are not in dispute. The provisions under which TDS has been deducted would not hold much relevance in such a case. Therefore, I direct Ld. AO to grant full TDS credit to the assessee as available. 4. The appeal stands allowed. Order pronounced on 07th January, 2026. -Sd- (MANOJ KUMAR AGGARWAL) ACCOUNTANT MEMBER Dated: 07-01-2026 आदेश की Ůितिलिप अŤेिषत /Copy of the Order forwarded to : 1. अपीलाथŎ/Appellant 2. ŮȑथŎ/Respondent 3. आयकरआयुƅ/CIT 4. िवभागीयŮितिनिध/DR 5. गाडŊफाईल/GF ASSISTANT REGISTRAR ITAT CHANDIGARH Printed from counselvise.com "