Chirag M. Shah Vs ITO (ITAT Ahmedabad)
It is observed that it is crystal clear that there are provisions under the IT Act; namely, section 199 of the IT Act, 1961 and Rule 37BA of the IT Rules, 1962 and the proper mechanism is also provided under the Act and Rules. Thus, respectfully following the ratio of the Jurisdictional High Court judgment, the assessee is entitled to get credit on TDS of Rs.2,96,734/-.
Facts- The assessee is an individual and Chartered Accountant by profession. The assessee filed an Income Tax Return declaring a total income of Rs. 14,31,540/- wherein tax payable worked is Rs. 2,67,246/-. The assessee claimed credit for TDS of Rs. 2,96,734/- and thereby claiming refund of Rs. 29,488/-. As per intimation u/s 143(1) TDS credit of Rs. 62,721/- was given and tax of Rs. 2,46,857/- was demanded.
Aggrieved by this intimation order the assessee filed rectification application u/s. 154 on 03.07.2015 to the jurisdictional AO and also e-filed rectification to the CPC Centre Bangalore. The assessee also claimed that the CPC Centre has wrongly charged interest under Section 234A as the assessee has filed the Return of Income well in time within the extended due date period of 30.11.2014. The assessee also claimed the CPC Centre has wrongly charged interest under Section 234B and 234C of the Act. The Deputy Commissioner of Income Tax has passed an order dated 28.09.2016 confirming the same addition made in the intimation and reject the rectification petition filed by the assessee.
Aggrieved against this rectification order, the assessee filed an appeal before the Ld. CIT(A)-4, Ahmedabad. The short issue in this case is that the assessee is following cash basis of system of accounting and the assessee has offered the tax of the professional fees income on receipt basis i.e. on cash basis. However, the assessee is client/deductor has made TDS in the earlier years. As the assessee is following the cash basis system of accounting though the TDS is being made in the earlier years the assessee claimed TDS credit in the current year where the professional fees paid to receive.
Conclusion- Relying on the decision of the Jurisdictional High Court in the case of Naresh Bhavani Shah (HUF) vs. CIT it is observed that it is crystal clear that there are provisions under the IT Act; namely, section 199 of the IT Act, 1961 and Rule 37BA of the IT Rules, 1962 and the proper mechanism is also provided under the Act and Rules. Thus, respectfully following the ratio of the Jurisdictional High Court judgment, the assessee is entitled to get credit on TDS of Rs.2,96,734/-.
FULL TEXT OF THE ORDER OF ITAT AHMEDABAD
This is an appeal filed by the assessee against the order dated 15.03.2019 passed by the Commissioner of Income Tax (Appeals)-4, Ahmedabad relating to the Assessment Year 2014-15.
2. The brief facts of the case is that the assessee is an individual and Chartered Accountant by profession. The assessee filed Income Tax Return on 28.11.2014 declared total income of Rs. 14,31,540/- wherein tax payable worked is Rs. 2,67,246/-which is inclusive of education cess. The assessee claimed credit for TDS of Rs. 2,96,734/- and thereby claiming a refund of Rs. 29,488/-. The return was processed by Deputy Commissioner of Income Tax, Computer Processing Centre, Bangalore CPC Centre, Bangalore on 10.06.2015 by intimation under Section 143(1) of the Income Tax Act, 1961 (hereinafter referred to as ‘Act’). By this intimation the CPC Centre has gives TDS credit of Rs. 62,721/-only and raised a tax demand of Rs. 2,46,857/-. The grievances of the assessee is that the entire TDS amount of Rs. 2,96,734/-was not duly given credit by the CPC Centre. Aggrieved by this intimation order the assessee filed an rectification application under Section 154 on 03.07.2015 to the jurisdictional AO namely ITO, Ward-4(2)(1) and also e-filed rectification to the CPC Centre Bangalore. The assessee also claimed that the CPC Centre has wrongly charged interest under Section 234A as the assessee has filed the Return of Income well in time within the extended due date period of 30.11.2014. The assessee also claimed the CPC Centre has wrongly charged interest under Section 234B and 234C of the Act. The Deputy Commissioner of Income Tax has passed an order dated 28.09.2016 confirming the same addition made in the intimation and reject the rectification petition filed by the assessee.
3. Aggrieved against this rectification order, the assessee filed an appeal before the Ld. CIT(A)-4, Ahmedabad. The short issue in this case is that the assessee is following cash basis of system of accounting and the assessee has offered the tax of the professional fees income on receipt basis i.e. on cash basis. However, the assessee is client/deductor has made TDS in the earlier years. As the assessee is following the cash basis system of accounting though the TDS is being made in the earlier years the assessee claimed TDS credit in the current year where the professional fees paid to receive. The claim of the assessee relating to TDS credit is as follows:
