Aay Kay Manufacuring Co. Vs ITO-CPC (ITAT Amritsar)
The recent ruling by the Income Tax Appellate Tribunal (ITAT) in Amritsar on the case of Aay Kay Manufacturing Co. versus the Income Tax Officer – Central Processing Centre (ITO-CPC) has garnered significant attention. The crux of the dispute revolves around the addition of Rs. 4,83,000 by the CPC, Bangalore, under Section 43B of the Income Tax Act, 1961, for not depositing the Tax Collected at Source (TCS) amount within the stipulated timeframe.
Background of the Case
Aay Kay Manufacturing Co., engaged in the business of trading scrap, filed an appeal against the order of the Joint Commissioner of Income Tax (Appeals) [JCIT(A)]—12, Mumbai. The JCIT(A)’s order, dated September 15, 2023, upheld the addition made by the CPC, Bangalore, under Section 43B for the non-deposition of TCS amounting to Rs. 4,83,000.
Grounds of Appeal
The appellant raised several grounds, primarily focusing on the following points:
- The erroneous addition of Rs. 4,83,000 on account of TCS payable, which was mistakenly reported in the tax audit report.
- The incorrect conclusion by the CIT (Appeals) and AO that the TCS payable was claimed as an expense by the appellant, contrary to the returned income.
- The inapplicability of Section 43B on the TCS payable amount, as it was not claimed as a deduction in the profit and loss account.
- The misreporting of the TCS payable amount in the tax audit report due to an inadvertent error.
Proceedings and Findings
