Ram Bhagat Phatela Vs ITO (ITAT Chandigarh)
ITAT Condoned 87-Day Delay in TDS Mismatch Appeal; Matter Remanded for Fresh Decision- Bona Fide Confusion Over CPC Rectification Saves Assessee
Ram Bhagat Phatela Vs ITO, ITA No. 327/Chd/2025, AY 2022-23, order dated 12.11.2025
Assessee, a commission agent (Kachha Arhtiya) dealing in agricultural produce, filed return declaring income of Rs. 7,91,300 & claiming TDS credit of Rs. 1,13,872. CPC, while processing u/s 143(1), allowed only Rs. 41,634, resulting in a TDS short-credit of Rs. 72,238. Assessee filed appeal before CIT(A) with a delay of 87 days, which CIT(A) refused to condone & dismissed the appeal in limine.
Before Tribunal, Assessee explained that the delay was caused due to bona fide confusion created by departmental communications. ITO, Sirsa, through letter dated 06.03.2023, directed him to approach CPC, Bengaluru because rectification rights were not transferred to AO. Income-tax Bar Association, Sirsa had also represented the issue to higher authorities, leading Assessee to believe that rectification at CPC was the appropriate remedy. Tribunal held that the explanation was plausible, bona fide, & supported by official correspondence.
Relying on the Supreme Court judgment in Collector, Land Acquisition vs. Katiji emphasising liberal interpretation in condonation matters, Tribunal held that there was no deliberate inaction & that substantial justice must prevail. It noted that several Chandigarh Bench decisions had condoned similar delays arising from CPC-related TDS mismatch issues.
