2024 (12) TMI 312 - AT - Income Tax

Assessee-in-default u/s. 201(1) and 201(1A) - non-compliance of TDS provisions u/s. 194C with respect to payment - HELD THAT - The assessee has filed copy of challan of payment of TDS and interest amount for which challan and Form No. 27A. Assessee has also produced on record Form. No. 16A issued by Revenue as downloaded from Traces for the fourth quarter of financial year 2016- 17 (assessment year 2017-18) (Certificate No. DNYYWOO), wherein said TDS amount is found credited to the credit of PNC Infratech Ltd for deduction of tax at source u/s. 194C on amount paid/credited by the assessee in favour of PNC Infratech Limited and said Form No. 16A is placed. These documents/evidences are filed for the first time before ITAT. Thus, based upon these documents /evidences, which are now filed before me for the first time and the statement made by assessee before the Bench, the assessee must succeed in this appeal. However, since the documents are filed for the first time before me, they require verification. Allow the appeal of the assessee and direct AO to grant appropriate credit for TDS/Interest deposited by the assessee after verifying the documents. Before Parting, I would also like to highlight unfortunate manner in which the authorities below has dismissed the contentions of the assessee. The department is well equipped with the latest technologies and the filing and processing etc are now being done electronically by department. Almost all the data s are now available digitally with the department and the relevant officers can access these digital data online.

Issues:
Assessment of assessee as assessee-in-default for non-deduction of TDS under Section 194C of the Income-tax Act, 1961.

Analysis:
The appeal arose from an order passed by the Assessing Officer holding the assessee as assessee-in-default for not complying with the provisions of Section 194C of the Income-tax Act, 1961. The assessee contended that TDS was duly deducted and deposited within the stipulated time. The Assessing Officer raised a demand of Rs. 4,99,030 against the assessee. The Commissioner of Income Tax (Appeals) affirmed the order of the Assessing Officer, stating that the assessee failed to provide verifiable proof of TDS deposit. The assessee then appealed to the ITAT, submitting documents for the first time, including challans, TDS returns, and Form 16A, to prove TDS compliance. The ITAT allowed the appeal, directing the AO to verify the newly submitted documents and grant appropriate credit for TDS and interest deposited by the assessee.

The ITAT observed that the assessee, engaged in road construction, failed to comply with notices issued by the AO and was treated as an assessee-in-default for non-deduction of TDS on subcontract payments. The CIT(A) dismissed the appeal due to lack of evidence substantiating TDS deposits. The ITAT, considering the new evidence submitted by the assessee, allowed the appeal and directed the AO to verify the documents and grant credit for TDS and interest deposited. The ITAT criticized the authorities for dismissing the assessee's contentions without utilizing available technology for verification, highlighting the unnecessary litigation costs incurred.

In conclusion, the ITAT allowed the appeal of the assessee, subject to verification of the newly submitted documents by the AO. The ITAT emphasized the need for authorities to utilize available technology for verification to avoid unnecessary litigation and costs.

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