TDS Credit as per Inocme tax return, Income Tax

[SANJAY BAHETI]

Professional colleagues,

I am practicing CA since 2009 in proprietorship concern.

Also i am doing statutory Branch Audit of Banks since 2010 and onwards.

I was empanelled with Indian overseas Bank. As i am CA i am following cash system of accounting.That is the Statutory Branch Audit Fees of the said Bank is accounting for in my books on receipt basis.

However the Bank as deductor deducting TDS on said Audit fees on accrual basis.

So what I have done i have taken or booked the same in the relevant F.Y. in which the same was issued by the bank by filing my ITR but i deferred it in the next F.Y. in which i am going to receive the said Statutory bank branch audit fee and claimed the same for TDS Tax Credit.

This Practice is following since 2010 and onwards accordingly i am getting my I.T.Refund till last Asst years.

However recently i got it an intimation from CPC Banglore under 143 (1) of I.T.Act relevant to F.Y.2013-14 i.e. Asstt.Year 2014-15 in which they had raised a I.T.Demand of ₹ 18910/- with Interest due to not considering TDS Credit of ₹ 16593/- which i have taken in F.Y.2012-13 i.e.relevant to Asstt.Year 2013-14 in ITR-4 but deferred the same in Asst,year 2014-15 when i actually received the fee which was booked on cash basis and claimed the same TDS Credit in Asst year 2014-15 while i had filed ITR-4 for this asstt.year.

Now query how to resolve the said intimation i.e. whether by way rectification under 154 for both Asst.years or otherwise else i.e. written reply to concerned ITO.

Please Reply at soonest.

Also let me know how you are doing this issue in your books specifically when following the cash system of accounting so far practicing CA is concerned

Posts / Replies

[MARIAPPAN GOVINDARAJAN]

The procedure what you did is correct in my view. In the present system whatever TDS appeared in Form 26AS the Department calculated the gross income and calculate the tax and if the tax is less they issue notice for the recovery of the said amount with interest, neglecting the correct procedure as you adopted If you have got clarified in the above issue please share the same in this forum.