Case Law Details
Vishal Pachisia Vs ITO (ITAT Kolkata)
Introduction: The Income Tax Appellate Tribunal (ITAT) in Kolkata has allowed the appeal of an individual, Vishal Pachisia, against the National Faceless Appeal Centre, Delhi. The core issue was the non-credit of TDS of Rs. 76,200/-, deducted from the salary but not deposited by the employer, due to the absence of the assessee’s name in Form 26AS. The decision provides a window to make the necessary corrections to reflect the appropriate TDS credit.
Analysis: The appellant’s sole grievance was the failure of the CIT(A) to instruct the Assessing Officer to credit the TDS that had been deducted but not deposited by the employer. The case was not adjourned as it was considered a small issue, and the ITAT saw fit to hear the appeal immediately.
Upon careful examination, the ITAT identified that the TDS was not appearing under the assessee’s name in Form 26AS, possibly due to the employer’s failure to deposit the sum or a wrong PAN fed in the TDS return. Recognizing this, the Tribunal allowed the assessee an opportunity to rectify the error, either by correcting the TDS return or by ensuring that the employer deposited the TDS and filed it accordingly.
This decision acknowledges the possibility of genuine errors in tax proceedings and offers flexibility in correction, emphasizing fairness and justice.
Conclusion: The ruling in the case of Vishal Pachisia Vs ITO by ITAT Kolkata is a notable one, allowing for an appeal solely based on the correction of an administrative error. It emphasizes the Tribunal’s commitment to ensuring fairness in tax proceedings, even in cases where the amount involved may be considered small. By offering a fair chance to correct a mistake that had led to a legal dispute, the Tribunal has reinforced its stance on promoting just and reasonable adjudication. Future assessees may draw confidence from this judgment that even minor details will not be overlooked and that justice will be rendered impartially.
FULL TEXT OF THE ORDER OF ITAT KOLKATA
The present appeal is directed at the instance of the assessee against the order of the National Faceless Appeal Centre, Delhi (hereinafter the “ld. CIT(A)”) dated 30/03/2023, passed u/s 250 of the Income Tax Act, 1961 (“the Act’), for Assessment Year 2017-18.
2. The assessee has raised the following grounds of appeal:-
“1) For that on the facts and circumstances of the case, Ld. CIT(Appeals), NFAC was grossly erred in not directing Assessing Officer to allow the credit of TDS Rs. 76,200/- deducted on Salary by the employer but not deposited by employer to the credit of Central Government.
2) For that on the facts and circumstances of the case, the action of Ld. CIT(Appeals) NFAC in not directing Assessing Officer to allow the credit of TDS of Rs. 76,200/- is highly arbitrary, unjustified, unwarranted to the facts of the case and untenable in law.
3) I may add, alter, amend, modify or withdraw any grounds of appeal on or before the date of hearing.”
3. When the case was called for, the representative on behalf of the assessee filed an adjournment application. However, considering the smallness of the issue regarding allowability of TDS credit of Rs.76,200/- and as the grounds contain the prayer for giving directions to the Assessing Officer to allow the credit of TDS of Rs.76,200/-, we deem it fit to hear the appeal with the assistance of the ld. D/R and perusing the available records and accordingly reject the application for adjournment.
4. The sole grievance of the assessee is that, the ld. CIT(A) has grossly erred in not directing the Assessing Officer to allow credit of TDS deducted on salary by the employer but not deposited by employer to the credit of Central Government.
5. We have heard the ld. D/R and perused the material placed before us.
6. We notice that the assessee has filed the return for Assessment Year 2017-18 on 30/03/2018 and in the said return, tax deducted at source on salary was claimed at Rs.76,200/-. However, since the said sum was not appearing under the name of the assessee in Form 26AS, the Centralized Processing Center (CPC), declined the said claim and raised demand against the assessee. Thereafter, the assessee preferred appeal before the ld. CIT(A) but failed to succeed since at that time also the alleged that it was not appearing in the name of the assessee in Form 26AS. We further notice that the reason for the alleged sum not appearing in Form 26AS under the employer of the assessee is that till the impugned proceedings were completed, the employer had either not deposited the said sum with the Government Authorities or wrong PAN has been feeded in the TDS return. Therefore, in the interest of justice and fair play and considering the sole ground raised by the assessee, we give one more opportunity to the assessee to appear before the ld. Assessing Officer and in the meantime make necessary efforts by approaching the employer to make necessary correction in the TDS return in case the amount has been deposited or in the alternative ask the employer to deposited the tax deducted at source from the salary of the assessee and file it in the TDS return so that credit appears in Form 26AS. Needless to mention that the assessee shall be provided sufficient opportunity of being heard.
7. In the result, appeal of the assessee is allowed for statistical purposes as per the terms indicated above.
Order pronounced in the Court on 24th July, 2023 at Kolkata.
