Case Law Details
Mohammed Meraj Vs ACIT (ITAT Kolkata)
Introduction: In the case of Mohammed Meraj Vs ACIT, the Income Tax Appellate Tribunal (ITAT) in Kolkata has called for a reassessment on account of a mismatch between Form 26AS and the income stated in the assessee’s Profit & Loss account. The issue at the core of the dispute revolves around an addition of Rs. 1,49,80,435/- by the Assessing Officer, which Meraj, who earns income from a transport services business, contested.
Analysis: The crux of the disagreement involves discrepancies in Meraj’s reported earnings from 21 clients. The ITAT noted that the Form 26AS indicated TDS was deducted on the amount of Rs. 1,58,59,982/-, while the assessee’s Profit & Loss account listed the income from these clients as only Rs.8,79,547/-.
Meraj argued that the higher amount in Form 26AS was due to non-taxable reimbursements related to the cost of fuels, driver’s remuneration, parking charges, and others, which totalled Rs.45473775/-. However, the Assessing Officer rejected this explanation due to the lack of supporting documentary evidence.
The Commissioner of Income Tax (Appeals) upheld the Assessing Officer’s addition, stating that Meraj failed to explain how he claimed and accounted for the said reimbursement. This led to the current appeal before the ITAT.
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