CIT(A) exceeded his legal brief directing verification of receipts before granting TDS

CIT(A) exceeded his legal brief directing verification of receipts before granting of TDS

In a recent judgment, the ITAT Kolkata has held that the CIT(A) exceeded his legal brief directing Assessing Officer (AO) to verify the receipts before granting of credit of TDS duly reflected in Form 26AS.

ABCAUS Case Law Citation:
4278 (2024) (10) abcaus.in ITAT

In the instant case, the assessee had challenged the order passed by the CIT(A) in issuing direction to Assessing Officer (AO) to verify whether income was offered to tax before allowing claim of TDS.

The appellant assessee was an Artificial Juristic Person (AJP) being executor to the estate of the deceased person and was created by the probate order of Hon’ble Calcutta High Court. TDS on dividend of Shares and Mutual Fund issued by the companies in favour of the deceased person had not been claimed by the deceased person because return was not filed by the deceased person. 

The appellant filed the return of the deceased person claiming the said TDS. However, the Assessing Officer, CPC issued an intimation order u/s 143(1) of the Income Tax Act, 1961 (the Act) in which partial TDS was denied to the appellant assessee because the same was not found reflected in Form 26AS.

Aggrieved with this action of AO, the assessee approached the Commissioner of Income Tax (Appeals) who directed the AO to verify whether the receipts against the TDS claimed had been offered to tax. The AO was further directed to carry out the verification and upon his satisfaction regarding the claim of the TDS, to allow the credit of TDS. The AO was also directed to pass a speaking order so that the appellant may file appeal, if the same was found desirable.

Aggrieved by the order of the CIT(A), the appellant approached the Tribunal and submitted that TDS should be fully allowed in accordance with law because the Executor assessee had shown the income and claimed the said TDS on such income, as such the direction of the CIT(A) was completely arbitrary, unjustified and illegal.

It was submitted that the said TDS had not claimed by the deceased person but reflecting in his Form 26AS, therefore, it should be allowed u/s. 199 of the Act.

The Tribunal opined that clearly the CIT(A) had exceeded his legal brief in giving such directions to the AO through which the matter had been virtually set aside to AO. It was noted from the decision of the Co-ordinate Bench of ITAT that CIT(A) has no power to set aside or remand back any matter to the AO.

The Tribunal held that the CIT(A) exceeded his legal brief when he gave directions to AO to verify the receipts, etc. The appellant deserved relief in terms of credit for TDS standing in the name of the deceased as seen from Form 26AS  

Accordingly, the appeal was allowed.

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