Case Number: ITA 1682/DEL/2019
Appellant: Mrinal Roy, Noida
Respondent: DCIT, Circle-2, Noida
Assessment Year: 2009-10
Case Filed On: 2019-02-28
Order Type: Final Tribunal Order
Date of Order: 2020-02-21
Pronounced On: 2020-02-21
The case of Mrinal Roy vs DCIT, Circle-2, Noida (ITA 1682/DEL/2019) involves an appeal made by Mrinal Roy against the non-allowance of credit for Tax Deducted at Source (TDS) for the assessment year 2009-10. The appeal was filed on 28th February 2019 and adjudicated by the Income Tax Appellate Tribunal (ITAT) in New Delhi. The final tribunal order was issued on 21st February 2020, with the judgment pronounced on the same day.
Mrinal Roy, the appellant, filed his return of income for the assessment year 2009-10. The assessment was completed under sections 147/143(3) of the Income Tax Act, based on the income declared by the appellant. However, the appellant was aggrieved by the non-allowance of credit for TDS amounting to Rs. 12,36,240/-, which was deducted by his employer, M/s Subhikshya Trading Service Ltd., but not deposited with the government.
The appellant raised the following grounds of appeal:
The appellant argued that the TDS was deducted by his employer but not deposited with the government, and hence, he should not be held liable for the tax that was already deducted.
The ITAT, led by Ms. Sushma Chowla, Vice President, examined the appeal on 16th January 2020. The tribunal noted that the CIT(A) had dismissed the appeal in limine due to the absence of the challan for the fee under section 249(1)(a). The appellant, however, furnished the necessary evidence in this regard before the tribunal.
The tribunal considered several legal provisions, including:
The tribunal also referenced the case of Aricent Technologies Holdings Ltd. vs. ACIT, which dealt with a similar issue of TDS credit when the deducted tax was not deposited by the employer.
The tribunal concluded that the appellant should be allowed credit for the TDS deducted by the employer, even if it was not deposited with the government, following the principle that the deductee should not suffer due to the default of the deductor. The tribunal directed the AO to allow the credit of TDS based on the primary evidence provided by the appellant.
Following the same parity of reasoning, we direct the Assessing Officer to allow the credit of tax deducted at source in the hands of the assessee, where the assessee produces the primary evidence of same being deducted tax at source out of the amount due to it. The ground of appeal no. 6 is thus allowed.
In the result, the appeal of the assessee is partly allowed.
Order pronounced in the open court on 21st February, 2020.
-Sd/- (SUSHMA CHOWLA) VICE PRESIDENT
This case highlights the importance of ensuring compliance with procedural requirements and the rights of the deductee when the deductor fails to deposit the deducted tax. Similar cases emphasize the necessity for clear legal provisions to protect taxpayers from suffering due to defaults by their employers or other deductors.
Manage the increasing number of hearings effortlessly by leveraging the legal AI revolution We are India's Leading revolutionary AI-powered legal platform where you can get enough insights into top cases and judgements.
Research Platform