Income Tax Appellate Tribunal - Delhi
Span Air Pvt Ltd, New Delhi vs Acit, Circle-24(1), New Delhi on 15 December, 2022
IN THE INCOME TAX APPELLATE TRIBUNAL
DELHI "G" BENCH: NEW DELHI
BEFORE SHRI KUL BHARAT, JUDICIAL MEMBER &
SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER
ITA No.266/Del/2022
[Assessment Year : 2014-15]
M/s. Span Air Pvt.Ltd., vs ACIT,
303, 3rd Floor, Circle-24(1),
Rasvilas Salcon Plot No.D-1, New Delhi.
District Centre, Saket,
New Delhi-110017.
PAN-AAACS2411E
APPELLANT RESPONDENT
Appellant by Shri M.R.Sahu, CA
Respondent by Shri Abhishek Kumar, Sr.DR
Date of Hearing 15.12.2022
Date of Pronouncement 15.12.2022
ORDER
PER KUL BHARAT, JM :
This appeal filed by the assessee for the assessment year 2014-15 is directed against the order of Ld. CIT(A)-25, New Delhi dated 07.12.2021. The assessee has raised following grounds of appeal:-
1. "That having regard to the facts of the case, provisions of law and judicial propositions, the Ld.CIT(A) erred in dismissing the rectification petition filed by the assessee-appellant for allowing tds credit in favour of the assessee-appellant amounting Rs.18,51,856/- deducted and deposited to the Central Govt, by the deductor M/s.Madhya Pradesh Congress Committee (A unit of National Congress) under the TAN NO:BPLI00865E emphasizing on the fact that in the Form 26AS the name of M/s. Madhya Pradesh Congress Committee was not reflected. Assessee prays for TDS credit of Rs.18,51,856/- which may kindly be allowed in its favour.
2. That having regard to the facts of the case, provisions of law and judicial propositions, the Ld.CIT(A) erred in rejecting the rectification application filed u/s.154 for allowing TDS credit amounting Rs.18,51,856/- deducted and deposited to the Central Govt, by the deductor M/s.Madhya Pradesh Congress Committee (A unit of National Congress) under the TAN NO:BPLI00865E disregarding the declaration given by the deductor M/s.Madhya Pradesh Congress Committee (A unit of National Congress), thus assessee prays for TDS credit of Rs.18,51,856/- which may kindly be allowed in its favour.
3. That having regard to the facts of the case, provisions of law and judicial propositions, the Ld.CIT(A) grossly erred in not allowing Tds credit of Rs.1,26,70,712/- reflected in the Form No.26AS against tds credit amounting Rs.1,22,74,649/- claimed in the return of income, without appreciating the fact that entire income on which TDS amounting Rs.1,26,70,712/- was deducted was offered to tax accordingly assessee prays for TDS credit of Rs.1,26,70,712/- as reflected in the Form 26AS.
4. The appellant craves the right to amend, add, delete, replace , all or any of the grounds of appeal either during the course of hearing or at any time before hearing of this appeal with the permission of the Hon'ble Tribunal."
2. Facts giving rise to the present appeal are that vide order dated 25.02.2016 passed u/s 143(1) of the Income Tax Act, 1961 ("the Act"), the Assessing Authority denied the assessee for credit of tax deducted as Tax deducted at source ("TDS").
3. Aggrieved against this, the assessee preferred appeal before Ld.CIT(A), who after considering the submissions, dismissed the appeal of the assessee.
4. Aggrieved against the order of Ld.CIT(A), the assessee preferred appeal before this Tribunal.
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5. Apropos to Grounds of appeal, Ld. Counsel for the assessee reiterated the submissions as made in the written synopsis. For the sake of clarity, the relevant contents of the written synopsis are reproduced as under:-
"Dear Sir, May your Honour be considered the followings:
1. At the beginning it is submitted that in the Grounds of Appeal mentioned as (A unit of National Congress) which may kindly be rectified and read as (A unit of Indian National Congress). It is typing mistake which may kindly be rectified.
2. FACTS OF THE CASE AND REASON FOR DISPUTE:
(2.1) .Original Return of Income was filed on 27/11/2014 declaring total income NIL and total tax payable under MAT provisions was arrived at Rs.1,28,39,239/-.
(2.2) .Revised return of income was filed on 29/11/2014 keeping the tax liability amounting Rs.1,28,39/239/- as unaltered as per the original return filed on 27/11/2014.
(2.3) .Tax liability amounting Rs.1,28,39,239/- was satisfied by availing TDS credit amounting Rs.1,22,74,649/- and depositing self assessment tax amounting Rs.5,64,596/-.[PB Pg.Nos. 1 to 2].
(2.4) Revised return of income was processed by CPC,Bangalore and vide order dated 25/02/2016, TDS credit was granted amounting Rs.1,08,10,521/-. [ Refer Pg.3 of the order].
(2.5) TDS credit amounting Rs.14,42,225/- deducted by "Madhya Pradesh Congress Committee" was not granted in favour of the assessee because the same was not reflected in the Form 26AS at the time of the order dated 25/02/2016 because "E TDS Returns" was not filed by the deductor.
3|Page (3) CIT(A) ORDER DATED 11/02/2020 DISMISSED THE APPEAL:
(3.1) When the appeal was scheduled for hearing before the CIT(A), TDS amounting Rs.18,51,856/- was duly reflected in the Form 26AS in the name of the deductor "Indian National Congress, TAN NO:BPLI00865E".[PB Pg.Nos. 5 &6].
(3.2) Additional Grounds of appeal was raised before the CIT(A) for grant of entire TDS credit amounting Rs. 18,51,856/- in favour of the assessee company.
(3.3) CIT(A)-25,Delhi vide order dated 11/02/2020 dismissed the appeal on the ground that name of the deductor " Madhya Pradesh Congress Committee" is not reflected in the Form 26AS.[Pg.ll of the CIT (A) order].
(4) RECTIFICATION PETITION ACKNOWLEDED ON 09/03/2020 WITH DECLARATION FROM THE DEDUCTOR " MADHYA PRADESH CONGRESS COMMUTE" DAETD 05/03/2020 AND RECTIFICATION ORDER DATED 07/12/2021 :
(4.1) Referring to the declaration dated 05/03/2020 of the deductor "
Madhya Pradesh Congress Committee" stating the fact that it is unit of "
Indian National Congress, TAN NO:BPLI00865E" and TDS amounting Rs.18,51,856/- deducted from the bills raised by the deductee "
M/s.Span AIR Pvt Ltd , PAN NO:AAACS2411E" , rectification petition was filed before the CIT(A) acknowledged on 09/03/2020.[PB Pg.No.19 to 21].
(4.2) CIT(A)-25,Delhi vide rectification order dated 07/12/2021 confirmed the order dated 11/02/2020 simply discarding the declaration of the deductor dated 05/03/2020.
(4.3) Being aggrieved by the rectification order of the CIT(A) dated 07/12/2021, appeal was filed before the TRIBUNAL for allowing TDS credit amounting Rs.18,81,856/- deducted and deposited by the deductor " Madhya Pradesh Congress Committee" in the name of" Indian National Congress,-TAN NO:BPLI00865E".
4|Page (5) SUBMISSION BEFORE THE TRIBUNAL:
(5.1) CIT(A)-25,Delhi in the rectification order dated 07/12/2021 simply discarded the declaration dated 05/03/2020 of the deductor " Madhya Pradesh Congress Committee" without appreciating the fact that TDS credit amounting Rs.18,81,856/- was duly reflected in the Form 26AS in the name of" Indian National Congress, TAN NO:BPLI00865E" ignoring the fact that TDS was duly deducted from the bills raised by the deductee and deposited to the Govt. Account.
(5.2) CIT(A) ignored the binding judicial precedents of the jurisdictional Delhi High Court and that of Delhi Tribunal.
(5.3) It is submitted that there is no dispute that TDS amounting Rs.18,81,856/- was suffered by the deductee and tds was duly deposited to the Govt Account and TDS credit was not granted because name of the deductor " Madhya- Pradesh Congress Committee" was not reflected in the Form 26AS.
(5.4) Reliance is placed upon the order of the Hon'ble Supreme Court in the case of "Kailash Vs. Nanhku (2005) 4 SCC 480", held as follows:
"28.All the rules of procedure are the handmaid of justice. The language employed by the draftsman of processual law may be liberal or stringent; but the fact remains that the object of prescribing procedure is to advance the cause of justice. In an adversarial system, no party should ordinarily be denied the opportunity of participating in the process of justice dispensation. Unless compelled by express and specific language of the statute, the provisions of CPC or any other procedural enactment ought not to be construed in a manner which would leave the court helpless to meet extraordinary situations in the ends of justice."
(5.5) .Reliance is placed upon the decision of the jurisdictional Delhi High Court in the case of " Indglonal Investment & Finance Ltd Vs. ITO [2011] 12 taxmann.com 108 (Del.HC)" at Para.12 it was held as under:
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12. Another principle is that the refund provisions should be interpreted in a reasonable and practical manner and when warranted liberally in favour of the assessee. If there is substantial compliance of the provisions for refund, it may not be denied because it is not made strictly in the form or the prescribed manner. The forms prescribed may be merely intended to facilitate payment of refund. The tax authorities have to act judiciously when they exercise their power under an enactment. The power given to the tax authorities under the enactments are mandated with the duty to exercise them when the statutory provisions so warrant. It is imperative upon them to exercise their authority in an appropriate manner. In case the Assessing Officer or tax authority comes to know that an assessee is entitled to deduction, relief or refund on the facts of the case and the assessee has omitted to make the claim, he should draw the attention of the assessee. The tax authorities should act as facilitators and not occlude and obstruct. The role of tax authorities has been aptly described in Asstt.CIT v. Rajesh Jhaveri Stock Brokers ( P.) Ltd. [2007] 291ITR 500 (SC):--
"19 The function of the Assessing Officer is to administer the statute with solicitude for the public exchequer with an inbuilt idea of fairness to taxpayers."[PB.Pg.No.55].
(5.6) .Reliance is placed upon the decision of the Delhi Tribunal in the case of" Escorts Ltd Vs. DCIT [2007] 15 SOT 368 (Del.Trib)" at Para.7 it was held as under:
"7. As per our considered view, credit for TDS must in every case be given to the assessee from whose income tax was deducted at source and paid to the credit of the Central Government. If the recipient of the income considers that he is not liable to tax in respect of the income, wholly or partly, therefore, does not disclose the amount of such income in his return, the Income-tax Department cannot refuse to give credit merely by contending that
6|Page the income had not been disclosed in the return filed by the assessee for the assessment year. The assessee may as per relevant provisions of Income-tax Act, consider the income either as not taxable in his hands or as being relatable to a different assessment year and he may even claim set off of loss or other deductions against such income. The assessee may also be not chargeable to tax on the income because of the overriding provisions of Double Taxation Avoidance Agreement and/or because of the provision for exemption of such income, whether wholly or partly, under some provisions of the Income-tax Act. It would be, therefore, improper and even impermissible for the revenue to swallow the amount of TDS after having received and enjoyed the same. It cannot be ignored that every item of TDS carries with it an obligation of trust and accountability to return the amount and/or give credit for the amount so deducted depending upon the tax liability of the recipient to be determined in the course of his assessment. If a wrong assessment is made for whatever reasons, the Department has all the powers to rectify the same by resort to rectification of mistakes, revision and/or other proceedings, legally available under the Statute. Assessee's income for which tax is deducted at source should not be refused to be given credit. Being a case of direct tax, there is also no question of unjust enrichment being claimed so as to take the credit of tax without an obligation to return the same to the assessee. The payer does not pay the amount of TDS as his own liability and he only acts as the agent of the Government or as trustee to collect the TDS for the Government, free of cost. If no credit is to be given to the payer and/or to the payee, the Government would have no authority to treat the same as tax and article 265 does not empower the Government to make any levy or collection of tax not authorized by law. There may be cases in which the assessee is not in a position to have the records and make complete claim of credit for TDS due to many factors beyond
7|Page his control, therefore, provisions relating to time-limit for claiming credit of TDS should also be liberally construed. If the tax due to the Government is not barred by limitation for collection or recovery, the refund of TDS due to the assessee should not be equally hit by any bar of limitation nor should there be any fetter on the assessee to claim credit for TDS at any time".[Pg.No.45 of PB].
(5.7) .Reliance is placed upon the decision of the Hon'ble Gujarat High Court in the case of" Vaghjibhai S. Bishnoi Vs. ITO [2013] 36 taxmann.com 317 (Guj.HC)" at Para.16, it was held as under:
Where assessee had claimed refund of lesser amount than that reflected in Form 26AS, he was to be permitted to make additional claim of refund.[Head Note].
"16. Resultantly, this petition succeeds. Respondents are directed to take into account the total sum of TDS as is reflected in Form 26AS and after computing such TDS amount, issue refund in the name of the petitioner. As mentioned hereinabove, the sum claimed by the petitioner towards TDS is Rs. 3,78,608/=, however, in Form 26AS, the amount of TDS is Rs. 4,00,064=36 paise. As the petitioner has chosen not to make any amendment in the petitioner, at present, while allowing his refund claim of Rs. 2,11,415/=; as requested for by the petitioner, he is also being permitted to make additional claim of refund, which shall be considered by the respondents in accordance with law and permit him more refund; if he is entitled to. The exercise of granting refund to the petitioner must be completed within four weeks from the date of receipt of this order. Rule made absolute accordingly. In the facts and circumstances of the case, we would have imposed the costs, however, as Shri Majmudar, learned advocate appearing on behalf of the petitioner has not insisted for costs, there shall be no order as to costs".[Pg.No.40 of PB].
8|Page (5.8) .Reliance is placed upon the decision of the Hon'ble Karnataka High Court in the case of " CIT Vs. Digital Global Soft Ltd [2011] 15 taxmann.com 78 (Kar.HC)" at Para.12, it was held as under:
In return of income for relevant assessment year, assessee did not claim credit for certain amount as it was not in possession of relevant TDS certificates - Assessment was made under section 143(1 )(a) - When assessee came into possession of TDS certificates, it filed an application under section 154 within two years from date of end of assessment year claiming said amount - Assessing Officer being fully satisfied about genuineness of certificates as said amount had been paid to Government, and assessee was not liable to pay any tax, ordered refund - Whether, on facts, order passed by Assessing Officer could be said to be erroneous or prejudicial to interest of revenue for exercising jurisdiction under section 263 - Held, no [In favour of assessee].[Head Note].
"12. Now, from the facts aforesaid, it is not in dispute that the said amount ordered to be refunded is the amount belonging to the assessee which was deducted at source and credited to the Government and after the assessment it was found that the assessee is not liable to pay the said amount as tax and therefore he was legitimately entitled for refund of the said amount. Because, he did not put forth the claim in the return as he was not able to produce the certificates under Section 203, he had not got the refund of the said amount. The moment he came in possession of the certificate, he filed an application on 12.02.2001, within two years from the date of the end of assessment year claiming the said amount. The Assessing Authority being fully satisfied about the genuineness of the certificate, as the said amount has been paid to the Government, as the assessee was not liable to pay any tax, he has ordered refund".
9|Page (5.9) . Reliance is placed upon the decision of the Hon'ble Bombay High Court in the case of" Induind Media & Communications Ltd Vs. ACIT [2014] 49 taxmann.com 326 (BOM.HC)", where it was held as under:
"Where subsequent to grant of TDS refunds, assessee received TDS certificates from its parties regarding which refund was not claimed, new refund claim was to be entertained".
(6). PRAYER BEFORE THE TRIBUNAL FOR GRANT OF TDS CREDIT AMOUNTING Rs. 18,51,856/- REFLECTED IN THE NAME OF "INDIAN NATIOANL CONGRESS":
In view of above facts including judicial precedents it is humbly prayed before the Tribunal to grant TDS credit amounting Rs. 18,51,856/- reflected in the Form 26AS in the name of " Indian National Congress, TAN NO:BPLI000865E"."
6. Ld. Counsel for the assessee took us through various documents filed in the form of Paper Book including a certificate issued by "M/s. Madhya Pradesh Congress Committee" stating that it is a unit of 'M/s. Indian National Congress' identified by PAN-AAABI0447H, TAN-BPLI00865E. The certificate further states about the Tax deducted at source of Rs.18,51,856/- for the Financial Year 2013-14 relevant to Assessment Year 2014-15.
7. On the other hand, Ld.Sr.DR opposed these submissions and submitted that before the authorities below, the assessee had not provided the evidences. Thereby, the authorities below could have verified the correctness of the claim of the assessee. However, he fairly conceded that matter may be restored to AO for verification the claim of the assessee regarding TDS.
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8. We have heard Ld. Authorized Representatives of the parties and perused the material available on record. We find that Ld.CIT(A) has decided the issue by observing as under:-
4. Findings/ Determination are as hereinafter-
4.1. "I have considered the application filed by the appellant including the written submissions.
In this case the appeal order u/s. 250 of the Income Tax Act has passed on 10.02.2020 disposing all the grounds of appeal by the appellant. The relevant part of the appeal order is reproduced below:
"All the above seven grounds of appeal pertain to credit of TDS deducted M/s. I Madhya Pradesh Congress Committee, TAN- BPU0086SE of Rs. 14,42,225/- not I being allowed. The appellant has furnished copy of From 26AS as per which appellant is entitle to tax credit of Rs. 14,42,225/- by M/s. Madhya Pradeshf Congress Committee is still not appearing. The additional ground filed by the appellant has already been dismissed above. Since TDS credit of Rs. 14,42,225/- of M/s Madhya Pradesh Congress Committee is still not appearing in From. 26AS, credit of the same cannot be allowed to the appellant and hence, appeal is hereby dismissed."
9. From the above finding of Ld.CIT(A), it is observed by Ld.CIT(A) that in Form No.26AS, a sum of Rs.14,42,225/- is still not appearing. However, Form No.26AS filed by the assessee alongwith Paper Book, there is an entry of tax deducted of Rs.18,51,856/- and the same amount also appears as deposit. Thus, looking to the facts of the present case, it would sub-serve the interest of justice, if issue is restored to the file of Assessing Authority to verify the correctness of the claim of the assessee, for giving credit of the tax 11 | P a g e related to the transaction in question. Thus, Grounds raised by the assessee in this appeal are allowed for statistical purposes.
10. In the result, the appeal of the assessee is allowed for statistical purposes.
Order pronounced in the open Court on 15 th December, 2022.
Sd/- Sd/-
(PRADIP KUMAR KEDIA) (KUL BHARAT)
ACCOUNTANT MEMBER JUDICIAL MEMBER
* Amit Kumar *
Copy forwarded to:
1. Appellant
2. Respondent
3. CIT
4. CIT(Appeals)
5. DR: ITAT
ASSISTANT REGISTRAR
ITAT, NEW DELHI
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