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2024 (12) TMI 106 - AT - Income TaxRectification U/s 154 revising therein Income from Salaries as per Revised Form 16 issued by KPMG - HELD THAT - In our opinion this issue needs proper verification and reconciliation in regards to the salary received by the assessee from KPMG as well as TDS deducted. AO is directed to verify the details and consider the claim in accordance with law. We, therefore, remand this issue to the Ld.AO. Needless to say that proper opportunity of law must be granted to the assessee. Appeal filed by the assessee stands partly allowed for statistical purpose.
Issues:
1. Rejection of application for Rectification u/s 154 by DCIT, CPC 2. Discrepancy in TDS credit claimed by the assessee 3. Assessment of income and TDS credit by CPC 4. Rejection of rectification application by AO CPC 5. Verification of TDS credit by AO 6. Appeal against Ld. CIT(A) order Analysis: Issue 1: Rejection of application for Rectification u/s 154 by DCIT, CPC The appellant filed an application for rectification u/s 154 due to a mismatch in TDS credit claimed. The CPC rejected the application stating that a fresh claim for change of income is not allowable under section 154 and can only be done under section 139(5). The Ld. CIT(A) upheld this rejection, stating that the rectification request cannot be considered at CPC as per the provisions of the Income Tax Act. The appeal against this order was dismissed as the changes made were not permissible under section 154. Issue 2: Discrepancy in TDS credit claimed by the assessee The appellant claimed TDS credit based on the original Form 16 issued by the employer, KPMG. However, subsequent revisions to the Form 16 resulted in a reduction of TDS amount. The Ld. CIT(A) directed the AO to verify the availability of TDS for the year and allow it if found correct. The ground of appeal was dismissed, emphasizing the need for documentary evidence to establish the TDS credit claim. Issue 3: Assessment of income and TDS credit by CPC The CPC processed the appellant's return of income, accepting the declared income but restricting the TDS credit to a lower amount. Subsequent rectification applications were made by the appellant to correct the TDS amount based on revised Form 16. However, the CPC rejected the applications, citing that the changes were not permissible under section 154. Issue 4: Rejection of rectification application by AO CPC The AO CPC rejected the rectification application filed by the appellant, stating that the tax had been computed correctly based on the income returned. The rejection was upheld by the Ld. CIT(A) as the changes requested were not allowable under section 154. Issue 5: Verification of TDS credit by AO The Ld. CIT(A) directed the AO to verify the availability of TDS credit for the year in question based on the documentary evidence provided by the appellant. The AO was instructed to allow the TDS credit if found correct, emphasizing the importance of supporting documentation. Issue 6: Appeal against Ld. CIT(A) order The appellant appealed against the order of the Ld. CIT(A) before the Tribunal. The Tribunal remanded the issue back to the AO for proper verification and reconciliation of the salary received and TDS deducted. The grounds raised by the appellant were partly allowed for statistical purposes. In conclusion, the judgment addresses the rejection of rectification applications, discrepancies in TDS credit, assessment by the CPC, and the need for proper verification of TDS credit. The Tribunal directed the AO to reexamine the details and consider the claim in accordance with the law, emphasizing the importance of providing documentary evidence to support the TDS credit claim.
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