2016 (1) TMI 498 - AT - Income Tax

Mistake in TDS deducted - assessee filled correction statement with NSDL - order passed u/s 201(1)/201(1A) of the Act raising a demand - Held that - Original TDS return has been filed showing TDS deducted at ₹ 7,01,986/- and TDS return filed on 2.2.2008 and later on assessee realized after going through its books of account that the correct figure of TDS deducted for quarter 3rd for Asst. Year 200809 was ₹ 5,79,983/- and not ₹ 7,01,986/-. But in due course of time assessment order u/s 201(1)/201(1A) of the Act was framed by ACIT-TDS wherein assessee had shown to have deducted TDS of ₹ 7,01,986/- and TDS deposited is shown at ₹ 5,79,983/- and accordingly assessee has been treated as assessee in default for low tax deposit of ₹ 1,30,180/- and coupled with interest of ₹ 83,250/- demand of ₹ 2,14,330/- has been raised. The ld. AR of the assessee submitted that the assessee has actually deducted ₹ 5,79,983/- and has deposited the same and has also revised the TDS return by filing correction statement with NSDL and accepted by NSDL. We are, therefore, of the view that with reference to the provisions of the Act duly supported by the Centralized Processing of statement of TDS Scheme 2013 referred above, the assessee is entitled to revise the TDS return and once this TDS return has been accepted by NSDL then the correct amount of TDS by the assessee for quarter 3rd will stand at ₹ 5,79,983/- and to verify this fact, we set aside the matter to the file of Assessing Officer with the instruction to give proper opportunity to the assessee who will appear before the Assessing Officer with proof of revised return filed for quarter 3rd along with necessary details to the satisfaction of Assessing Officer and if the same are found correct then the contention of the assessee to be accepted by taking TDS deducted for quarter 3rd at ₹ 5,79,983/- in place of ₹ 7,01,986/-. - Decided in favour of assessee for statistical purpose.

Summary

Issues:
Appeal against order of CIT(A) confirming demand under section 201(1)/201(1A) of the Income-tax Act, 1961 - Discrepancy in TDS amount reported - Revision of TDS return - Acceptance of correction statement by NSDL - Entitlement to revise TDS return.

Detailed Analysis:

Issue 1: Discrepancy in TDS amount reported
The appeal was against the order of CIT(A) confirming a demand raised under section 201(1)/201(1A) of the Income-tax Act, 1961. The assessee had initially reported TDS of Rs. 7,01,986/- for quarter 3rd of the financial year 2007-08. However, upon realizing the mistake, the assessee corrected the TDS amount to Rs. 5,79,983/- by filing a correction statement with NSDL. The Assessing Officer had raised a demand based on the original return without considering the correction statement filed by the assessee.

Issue 2: Revision of TDS return
The Centralized Processing of statement of TDS Scheme 2013 provided a framework for processing TDS returns and accepting correction statements. The scheme allowed for rectification of mistakes in TDS returns under Rule-5 & Rule-6, enabling deductors to revise their returns. Once a correction statement or revised TDS return was accepted by authorized agencies like NSDL, the original return was replaced by the revised return.

Issue 3: Acceptance of correction statement by NSDL
The Tribunal acknowledged the assessee's right to revise the TDS return as per the provisions of the Act and the Centralized Processing of statement of TDS Scheme 2013. The Tribunal directed the Assessing Officer to verify the revised return filed by the assessee for quarter 3rd and instructed to accept the correct TDS amount of Rs. 5,79,983/- instead of Rs. 7,01,986/-. The Tribunal allowed the appeal for statistical purposes, emphasizing the importance of accepting the corrected TDS amount based on the revised return filed with NSDL.

In conclusion, the Tribunal's judgment highlighted the significance of the correct reporting of TDS amounts and the entitlement of the assessee to revise the TDS return in case of discrepancies. The decision emphasized adherence to the procedural aspects outlined in the Centralized Processing of statement of TDS Scheme 2013 and directed the Assessing Officer to consider the revised TDS amount accepted by NSDL for determining the tax liability.