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2023 (4) TMI 27 - AT - Income TaxDisallowing the claim of brought forward TDS u/s 199 read with rule 37BA - as submitted related income is properly declared in the Income Tax Return and was also appearing in previous Form 26AS of that earlier Assessment Year - HELD THAT - Considering the totality of the facts and provision of section 199 of the Act and Rule 37BA of the Income Tax Rules, 1962, it would sub-serve the interest of justice, if the matter is restored to the AO who would verify the correctness of the claim of the assessee regarding the income corresponding to brought forward TDS was offered to tax in the concerned Assessment Year. No credit was claimed in respect of the TDS under consideration in the relevant year. If the AO finds that no credit was taken related to the income offered in that particular AY, he would allow the set off of TDS brought forward - Ground raised by the assessee is allowed for statistical purposes.
Issues Involved:
1. Validity of the order based on law and facts. 2. Confirmation of disallowance and addition of Rs. 16,34,060/- regarding employee's contribution to ESI and EPF. 3. Retrospective nature of the amendment in section 36(1)(va) of the Act. 4. Non-allowance of brought forward TDS of Rs. 9,94,719/- as per Section 199 read with rule 37BA. Summary: Issue 1: Validity of the Order The assessee did not wish to adjudicate this ground of appeal. Therefore, it was dismissed as not pressed. Issue 2: Disallowance and Addition of Rs. 16,34,060/- The assessee did not wish to adjudicate this ground of appeal. Therefore, it was dismissed as not pressed. Issue 3: Retrospective Nature of Section 36(1)(va) Amendment The assessee did not wish to adjudicate this ground of appeal. Therefore, it was dismissed as not pressed. Issue 4: Non-Allowance of Brought Forward TDS of Rs. 9,94,719/- The only effective ground raised by the assessee was regarding the non-allowance of brought forward TDS of Rs. 9,94,719/- as per Section 199 read with rule 37BA. The assessee argued that the TDS was properly declared in the Income Tax Return and appeared in the previous Form 26AS. The assessee had filed for rectification u/s 154, which was rejected by CPC. The Tribunal noted that the assessee had offered the income corresponding to the brought forward TDS to tax in the concerned Assessment Year. However, the CPC did not allow the benefit of the brought forward TDS amounting to Rs. 9,94,700/-. The Tribunal decided that it would serve the interest of justice to restore the matter to the Assessing Officer (AO) for verification. The AO is to verify if the income corresponding to the brought forward TDS was offered to tax in the relevant year and if no credit was claimed for the TDS in that year. If verified, the AO should allow the set-off of the TDS brought forward amounting to Rs. 9,94,700/-. Thus, Ground No. 4 was allowed for statistical purposes. Conclusion: The appeal of the assessee was partly allowed for statistical purposes.
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