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2024 (12) TMI 822 - AT - Income TaxAllowance of increased TDS credit by CIT(A) - determination of correct amount of TDS credit - AO did not accept the assessee s claim for higher TDS credit and restricted it to amount as originally claimed in the return of income - HELD THAT - As we find no infirmity in the order of the CIT(A). CIT(A) has correctly allowed the TDS credit as reflected in the updated Form 26-AS and directed the AO to verify and grant the credit. It is a settled principle of law that TDS credit appearing in Form 26-AS must be allowed when the revenue relating to such credit is already offered to tax, subject to verification. Accordingly, we dismiss the Revenue's appeal as infructuous. The AO is directed to verify the updated Form 26-AS for the relevant assessment year and grant TDS credit as determined by the CIT(A). Appeal filed by the Revenue is dismissed.
Issues:
Appeal against increased TDS credit allowed by CIT(A) based on updated Form 26AS. Analysis: The appeal was filed by the Revenue against the order of the Commissioner of Income Tax (Appeals) regarding the increased TDS credit granted to the assessee. The sole ground of appeal raised by the Revenue questioned the justification of allowing increased TDS credit of Rs. 168,61,96,022/- when the rectification order had initially granted TDS credit of only Rs. 165,66,37,908/-. The facts of the case revealed that the assessee had originally claimed TDS credit of Rs. 165,66,37,908/-, but as per the updated Form 26AS, the credit was actually Rs. 1,67,86,04,178/. The assessee filed a rectification application under Section 154 before the Assessing Officer (AO) to correct the TDS credit discrepancy. However, the AO, through a rectification order, did not accept the claim for higher TDS credit and maintained it at the originally claimed amount. Upon being aggrieved, the assessee appealed before the CIT(A), who allowed the increased TDS credit of Rs. 168,61,96,022/- based on the updated Form 26AS, citing reasons such as late payment of TDS and late filing of revised quarterly TDS returns. The CIT(A) directed the AO to verify the updated Form 26AS and grant the credit accordingly. During the hearing, the Departmental Representative (DR) conceded the issue, acknowledging the correctness of the TDS credit as determined by the CIT(A) and agreeing to comply with the directions given. The Authorized Representative (AR) of the assessee confirmed that the corresponding revenue from which the TDS was deducted had already been offered for taxation. The Appellate Tribunal found no infirmity in the CIT(A)'s order, emphasizing the importance of allowing TDS credit reflected in Form 26AS when the related revenue is already taxed. The Tribunal dismissed the Revenue's appeal as infructuous and directed the AO to verify the updated Form 26AS for the relevant assessment year and grant TDS credit of Rs. 168,61,96,022/- as determined by the CIT(A), ensuring the inclusion of corresponding revenue in the assessee's total income. In conclusion, the appeal filed by the Revenue was dismissed, with the Tribunal highlighting the need for Revenue authorities to exercise discretion in avoiding unnecessary litigation and promoting efficient dispute resolution through verification at the AO's level. The order was pronounced in an open court at Ahmedabad on 13 December 2024.
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