Case Law Details
DCIT Vs Arvind Ltd. (ITAT Ahmedabad)
Section 155(14) was inserted by Finance Act 2002 w.e.f. 1.6.2002 it is reproduced below :
(14) Where in the assessment for any previous year or in any intimation or deemed intimation under sub-section (1) of section 143 for any previous year, credit for tax deducted or collected in accordance with the provisions of section 199 or, as the case may be, section 206C has not been given on the ground that the certificate furnished under section 203 or section 206C was not filed with the return and subsequently such certificate is produced before the Assessing Officer within two years from the end of the assessment year in which such income is assessable, the Assessing Officer shall amend the order of assessment or any intimation or deemed intimation under sub-section (1) of section 143, as the case may be, and the provisions of section 154 shall, so far as may be, apply thereto :
Provided that nothing contained in this sub-section shall apply unless the income from which the tax has been deducted or income on which the tax has been collected has been disclosed in the return of income filed by the assessee for the relevant assessment year.
Section 155(14) provides that if any claim of TDS is left at the time of filing of income tax return and assessee subsequently comes to know of any tax deducted by a party but not informed till the date of filing of income tax return, and subsequently the said TDS is also reflected in Form 26AS, then assessee should file revised income tax return and claim TDS. In case time to revise the income tax return is over, then assessee can file an application before Assessing Officer under section 155(14) of Income Tax Act 1961. When this section was introduced there was a requirement of submitting Original TDS Certificates with Income Tax Return Form. Now the systems are changed and TDS certificates are no longer submitted with Income Tax Return and credit of TDs is verified from Form 26AS. The language used in section 155(14) is still same. But it can be presumed that in case any TDS was not available in Form 26AS at the time of filing of Income Tax Return and subsequently the assessee comes to know that further tax was deducted by some party and now the same is appearing in Form 26AS, then he can either revise the income tax return or in case time to revise the return is over, he can file an application before Assessing Officer. The benefit of this section can only be availed when income as reflected in TDS Certificates/Form 26AS is already disclosed in Income Tax Return and there is no change in particulars of income. The benefit can only be claimed within 2 years from the end of assessment year in which income was assessable. No form is prescribed for this purpose. The Income Tax Portal does not allow the assessee to claim further credit of TDS not availed at the time of filing of Income Tax Return. The only course available is to file an application under section 155(14) read with Section 154 before jurisdictional Assessing Officer. In case the Jurisdictional AO does not accept then appeal can be filed before CIT (Appeals).
Income Tax Appellate Tribunal in the case of DCIT vs. Arvind Limited in ITA No. 588 /Ahd/2014 has held as under :
Briefly stated facts of the case as culled out from the records are that assessee is a limited company and assessment u/s 143(3) of the Act was framed on 31.12.2010 where credit for tax deducted at source was given only for Rs.55,09,852/- instead of Rs.71,86,193/- thereby giving short credit of Rs.16,76,341/-. Thereafter assessee filed an application u/s 154 of the Act on 14.2.2011 pointing out the mistake in the assessment order u/s 143(3) of the Act for giving short credit of tax deducted at source of Rs.16,76,341/-Ld. Assessing Officer rejected assessee’s claim for getting tax deducted at source credit of Rs.16,76,341/- by observing that in the return of income assessee has only shown tax deducted at source of Rs. 55,09,853/- and even in the revised return also the claim of tax deducted at source to be paid remained the same and the assessee has neither claimed credit of additional tax deducted at source in the form prescribed nor the claim has been made within the period prescribed therein. Aggrieved, assessee went in appeal before ld. Commissioner of Income Tax(A) and succeeded as ld. Commissioner of Income Asst. Year 2007-08 Tax(A) allowed assessee’s additional claim of tax deducted at source.
ITAT rejected the departmental appeal and held as under :
We observe that the issue raised by the assessee in this appeal is squarely covered in favour of assessee by the decision in the case of Ardor International Pvt. Ltd. vs. ACIT in ITA No.1170/Ahd/2013 pronounced on 2/5/2016. We therefore, in view of above discussion of the facts and following the decision of the Co-ordinate Bench, we hold that assessee is entitled to additional credit for tax deducted at source of Rs.16,76,341/- and therefore no interference is called for in the order of ld. Commissioner of Income Tax(A) allowing assessee’s claim of additional credit for tax deducted at source of Rs.16,76,341/-. Accordingly this ground of Revenue is dismissed.
FULL TEXT OF THE ORDER OF ITAT AHMEDABAD
This appeal of Revenue for Asst. Year 2007-08 is directed against the order of ld. Commissioner of Income Tax(A)-VI, Ahmedabad, dated 09.12.2013 vide appeal no.CIT(A)-VI/ACIT/Cir.1 /02/11-12 arising out of order u/s 154 of the Income-tax Act, 1961 (in short the Act) passed by ACIT, Cir-1, Ahmedabad. Revenue has raised following grounds of appeal :-
(1) The CIT(A)ltas erred in law and on fact in allowing additional credit of (Rs.16.76 lacs} despite the fact that the assessee had neither claimed the said credit in the original return nor revised return.
(2) The CIT(A) has erred in law and. on facts by invoking the provisions of section 155(14) which are only applicable in a case where TDS credit was not given due to non filing of TDS certificates with the return. The provisions of section 155(14) cannot be applied in a case where claim of TDS in question has not been made in the return. .
On the fact and in the circumstances of the case and in law, the CIT(A) ought to have upheld the order of the Assessing Officer to the extent mentioned above since the assessee has failed to disclose his true income/book profit.
The appellant prays that the order of CIT(A) on the above grounds be set aside and that of the Assessing Officer be restored to the above extent. The appellant craves, to leave, to amend or alter any ground or add a new ground which may be necessary,
2. Briefly stated facts of the case as culled out from the records are that assessee is a limited company and assessment u/s 143(3) of the Act was framed on 31.12.2010 where credit for tax deducted at source was given only for Rs.55,09,852/- instead of Rs.71,86,193/-thereby giving short credit of Rs.16,76,341/-. Thereafter assessee filed an application u/s 154 of the Act on 14.2.2011 pointing out the mistake in the assessment order u/s 143(3) of the Act for giving short credit of tax deducted at source of Rs.16,76,341/-. Ld. Assessing Officer rejected assessee’s claim for getting tax deducted at source credit of Rs.16,76,341/- by observing that in the return of income assessee has only shown tax deducted at source of Rs. 55,09,853/-and even in the revised return also the claim of tax deducted at source to be paid remained the same and the assessee has neither claimed credit of additional tax deducted at source in the form prescribed nor the claim has been made within the period prescribed therein. Aggrieved, assessee went in appeal before ld. Commissioner of Income Tax(A) and succeeded as ld. Commissioner of Income Tax(A) allowed assessee’s additional claim of tax deducted at source by observing as follows :-
4.4. I have considered the facts of the matter. A.O’s reliance on Section~239 is misplaced, as the said section deals with form of claim for refund and limitation, whereas in the instant case the issue for consideration is allowing the credit of TDS based on the certificates received after the date of filing of the return of income. Appellant had made the request for additional .credit of TDS vide its letter, dtd.19.02.2008. The said claim was made before the completion of the assessment proceedings and within two years from the end of the assessment year under consideration. There is nothing on record to show that the income corresponding the additional claim of TDS was not disclosed in the return of income. Therefore, the appellant is entitled to the credit of the impugned amount in accordance with Section 155(14) of the Act. A.O. is directed to give credit of the impugned tax deducted at source. This ground of appeal is allowed.
3. Aggrieved, Revenue is now in appeal before the Tribunal.
4. Ld. Authorised Representative of the assessee submitted that the issue in this appeal is squarely covered by the decision of the Tribunal in the case of Ardor International Pvt. Ltd. vs. ACIT in ITA No.1170/Ahd/2013 pronounced on 2/5/2016. Ld. Authorised Representative also submitted that admittedly in the original and revised returns assessee claimed tax deducted at source of Rs.55,09,852/-. However, during the course of regular assessment proceedings in compliance to notice u/s 143(2) of the Act assessee company submitted letter dated 19/12/2008 claiming total credit of Rs.71,86,183/- towards tax deducted at source along with party-wise tax deducted at source and TDS certificates. Further ld. Authorised Representative drawing support from sec.155(14) of the Act submitted that that assessee is eligible to claim tax deducted at source after filing return of income even though claim for TDS certificate in respect of such certificates is not mentioned in the return of income subject to the fulfillment of conditions namely 1) income in respect of which tax deducted at source is claimed is disclosed in the return of income and 2) such certificates are submitted before the Assessing Officer then within two years from the Asst. Year in which income corresponding to the tax deducted at source is offered to taxes. Ld. Authorised Representative referred and relied on the following decisions:-
1. ITAT Chennai’s order in the case of ITO vs. Shree Annupallavi Finance and Investment (2011) 131 ITD 205
2. ITAT Chennai’s order in the case of Supreme Renewable Energy Ltd. vs ITO (2010) 124 ITD 394
3. ITAT Mumbai ‘s order in the case of Toyo engg. India Ltd. vs. JCIT (2006) 5 SOT 616 (Mum)
4. Premlata Jalani vs. Commissioner of Income Tax (2003) 264 ITR 744 (Raj)
5. We have heard rival contentions and perused the record placed before us and gone through the decisions relied on by the assessee. Sole grievance of the Revenue is against the order of ld. Commissioner of Income Tax(A) allowing additional credit of tax deducted at source of Rs.16.76 lacs which has neither been claimed by the assessee in the original return nor in the revised return. The issue raised in this appeal travel within a narrow campus wherein assessee in its original and revised return claimed Rs.55,09,852/-and thereafter during the course of assessment proceedings vide letter dated 19.2.2008 claimed tax deducted at source at Rs.71,86,193/- which was duly supported by party-wise tax deducted at source and certificates. Additional claim of tax deducted at source credit of Rs.16,76,341/- was denied by the Revenue for the only reason that it was not claimed in the returns of income but no dispute has been raised about the genuineness of additional TDS credit of Rs.16,73,341/-. Assessee’s application u/s 154 of the Act dtd.14th February 2011 requested for additional credit of tax deducted at source was also rejected. We further observe that the relevant provisions relating to such issues of allowing additional tax deducted at source are dealt u/s 155(14) which reads as follows :-
Provided that nothing contained in this sub-section shall apply to any shortfall in the payment of the tax due on the returned income where such shortfall is on account of under-estimate or failure to estimate—
(a) the amount of capital gains; or :
(b) income of the nature referred to in sub-clause fix) of clause (24) of section 2,and the assesses has paid the whole of the amount of tax payable in respect of income referred to in clause (a) or clause (b), as the case may be, had such income been a part of the total income, as part of the remaining installments of advance tax which are due or where no such installments are due, by the 31st day of March of the financial year:
6. In view of above provisions of section 155(14) of the Act it can be said that assessee can get benefit of additional tax deducted at source if income in respect of tax deducted at source is duly revealed in the income-tax return and such certificates are submitted before the Assessing Officer within two years from the end of Asst. Year. As far as second condition we observe that assessee submitted a certificate on 19th February, 2008 which was well within time limit of two years from the end of Asst. Year and as regards the issue that the income in respect of tax deducted at source credit has been disclosed in the return of income assessee has duly submitted the tax deducted at source certificate with all the details of parties and gross amount on which tax has been deducted which are verifiable from the books of accounts of assessee and are not disputed by the revenue.
6.1 We further observe that similar facts came for adjudication before the Co-ordinate Bench, Ahmedabad in the case of Ador International Pvt. Ltd. (supra) wherein the issue of getting benefit of additional tax deducted at source claim during the assessment proceedings but not claimed in the return of income was decided in favour of assessee allowing him claim of addition tax deducted at source by observing as follows :-
“9. We have heard the rival contentions and perused the material placed on record. The only issue in this appeal of the assessee is against the action of Id.CIT(A) in confirming the order of the Id. Assessing Officer u/s 154 of the Act, denying the credit of Tax Deducted at Source (TDS) of Rs.74,774/-. From going through the records, we observe that the assessee has not made any claim of Tax Deducted at Source (TDS) of Rs.74,774/-, deducted by deductor M/s. Bodal Chemicals Limited on receipt of reimbursement expenditure. The ITA No. H7O/Ahd/2Oi3 Ardor International Pvt Ltd vs. ACIT AY : 2008-09 impugned TDS Certificates were received by the appellant in the month of January, 2011, i.e., almost after the lapse of two years and nine months from the end of the financial year to which it related. The appellant on receiving the TDS Certificates of Rs.74,774/- in January, 2011, had no time left for revising the return of income u/s 139(5) of the Act as time limit for revising the return expires in one year from the end of the relevant assessment year, i.e., 3ist March 2010; and the only option left with the appellant was to file an application u/s 154 of the Act which gives powers to the Assessing Officer to amend any intimation or deemed intimation under sub-section (i) of Section 143 of the Act within four years from the end of the financial year. In the case of the assessee, the statutory time limit u/s 154 was getting lapsed on 3ist March 2011, and just before the lapse of the period u/s 154 of the Act the assessee moved an application u/s 154 of the Act on 03.02.2011. The basic question arising in the given facts and circumstances is that whether an assessee who has not claimed TDS while filing its return of income, when the requisite information/TDS Certificates were not in its possession and nevertheless the deductor has not issued TDS Certificates till the time of the due date of filing the return of income, can the assessee claim TDS deducted on the income which has been shown’in his return of income (but the deductor has deposited the TDS on a later date; however, very much relevant to the income shown by the assessee in his return of income) by filing an application u/s 154 of .the Act. The above question has been well addressed by the Hon’ble Karnataka High Court in the case of CIT vs. Digital Global Soft Limited, reported in 15 taxmann.com 78, on the following facts:-
“For the relevant assessment year, the assessee filed return of income showing certain income. It claimed credit for certain amount towards tax deducted at source. The Assessing Officer processed the return under section I43(l)(a). Subsequently, the assessee filed a letter pointing out that at the time of filing the return, credit for TDS amounting to Rs. 19,44,692 was not claimed since the relevant TI)S certificates were not available and since those certificates had been received subsequently, it wanted credit to be given to the extent of Rs. 19,44,692. Thereafter, the Assessing officer passed an order under section 154 rectifying the ITA No. H7O/Ahd/2Oi3 Ardor International Pvt Ltd vs. ACIT AY : 2008-09 intimation and gave credit of Rs. 19,44,672 towards tax deducted at source. The Commissioner, exercising his power under section 263, found fault with giving credit of the said amount as tax deducted at source, when that amount was not claimed in the returns filed by the assessee, Therefore, it modified the order under section 154 by withdrawing the credit given to the amount of Rs. 19,44,672. Aggrieved by the said order, the assessee preferred an appeal to the Tribunal. The Tribunal held that there was neither any error in the order section 154 nor any prejudice caused to the Government by giving credit for the same. Accordingly, it set aside the order of the Commissioner under section 263.
The Hon’ble Karnataka High Court, while adjudicating the issue on the above facts, held as under:-
“Section 139 deals with return of income. Sub-section (9) of section 139 sets out under what circumstances the return so filed is defective. Explanation to the said provision makes it clear that the tax, if any, claimed to have been deducted or collected at source and the advance tax and tax on self assessment, if any, claimed to have been paid has to accompany the return filed under section 139. If it does not accompany the return under section 139, the return so filed shall be regarded as defective. In other words, in the return filed under section 139, if the assessee is claiming deduction of the tax deducted at source, the said return should accompany the proof of such tax deducted at source. However, proviso to said provision makes it clear that if the person who deducted the tax has not furnished the certificate to the assessee, then only after such valid claim is made, the amount deducted is treated as payment on behalf of person from whose income the deduction was made and credit to the tax is given. If on assessment of the said return filed, the amount of tax paid by the assessee or on his behalf is treated as paid by him or on his behalf for any assessment year and it exceeds the amount with which he is properly chargeable under this Act for that year, he shall be entitled to a refund of the excess under section 237. Once an order is passed by the assessing authority under section I43(i)(a) or under section 143(3) or under section 154, a power is vested with the said assessing authority to rectify any mistake apparent from the record in the said order.
In order to rectify the said mistake, he can amend any order passed by him, under the provision of the Act or amend any order passed by him, under the provision of the Act or amend any intimation or deemed intimation under sub-section(l) of section 143. Such an amendment can be made on its own motion or when the mistake is brought to its notice by the assessee or where the authority concerned is • . Commissioner of appeals, by the Assessing Officer also. When the amendment is made under the section, an order shall be passed in writing by the income-tax authority concerned, where any such amendment has effect of reducing the assessment, the Assessing Officer shall make any refund which may be due to such assessee. Such an order of amendment has to be passed within a period of six months frornjhe end of the month in which the application is received by it either by making amendment or refusing to allow the claim. If any amendment ITA No. H7O/Ahd/2Oi3 Ardor International Pvt Ltd vs. ACIT AY : 2008-09 to be carried out is prejudicial to the interest of the assessee, then the assessee must be heard. If the order passed by the assessing authority is merged with the order passed by the Appellate Commissioner or Tribunal, the assessing authority has no jurisdiction to amend or rectify’ the mistake in such order. [Para 8]”
10. From going through the above decision of Hon’ble Karnataka High Court in the case of Digital Cllobal Soft Ltd (supra), we find that in the present appeal before us the issue is similar as the assessee has not claimed TDS in its regular return of income, because it was not in the possession of I he TDS certificates and so much so, the deductor M/s. Bodal Chemicals Limited has not issued the TDS certificates to the assessee. It was only in January, 2011, i.e., after the end of the two years and nine months from the end of the relevant financial year that the assessee came into possession of the TDS Certificates issued by M/s. Bodal Chemicals Limited for Rs.74,774/-. The appellant has submitted before the Assessing Officer that the amount on which TDS of Rs.74,774/- has been deducted is duly shown in the financial statements submitted by it at the time of filing of return of income. We are, therefore, of the view that the assessee is very much eligible for getting credit of Us.74,774/- as the said amount was not a lawful amount to the Government and the assessee should not be deprived of the credit of TDS of Rs.74,774/-for the mistake/delay made by the deductor. In the given circumstances, as the assessee was not having any possibility to revise the return u/s 139(5) of the Act, the only option left with him was to file an application u/s 154 of the Act which he did so; and therefore, Id. Assessing Officer using his inherent power u/s 154 of the Act for amending any mistake apparent on record should have examined the claim of the assessee by verifying the books of accounts of the assessee as well as the relevant ledger accounts wherein the impugned amount on which TDS of Rs.74,774/- has been deducted, is duly reflected.
11, We also observe that none appeared on behalf of the assessee during the appellate proceeding: before the Id. CIT(A) and we are, therefore, of the view that the matter to be set aside to the file o the Id. Assessing Officer to allow the ITA No. H7O/Ahd/2Oi3 Ardor International Pvt Ltd vs. ACT AY : 2008-09 claim of TDS of Rs.74,774/- after verifying the books of accounts and financia statements with regard to the receipt of reimbursement of expenses on which TDS of Rs.74,774/ has been deducted by M/s.Bodal Chemicals Limited. Needless to mention that necessary opportunity of being heard to be given to the assessee to provide all necessary documents an supporting towards the claim of TDS of Rs.74,774/-. Under these circumstances, the appeal of th assessee is allowed for statistical purposes.”
7. We observe that the issue raised by the assessee in this appeal is squarely covered in favour of assessee by the decision in the case of Ador International Pvt. Ltd. (supra). We therefore, in view of above discussion of the facts and following the decision of the Co-ordinate Bench, we hold that assessee is entitled to additional credit for tax deducted at source of Rs.16,76,341/- and therefore no interference is called for in the order of ld. Commissioner of Income Tax(A) allowing assessee’s claim of additional credit for tax deducted at source of Rs.16,76,341/-. Accordingly this ground of Revenue is dismissed.
8. In the result, appeal of Revenue is dismissed.
Author Bio
