TDS u/s 194Q not related to sale-ITAT remands case of mismatch of turnover
In a recent judgment, the ITAT has observed that TDS u/s 194Q is not related to sale while remanding the CPC order u/s 143(1) which restricted TDS credit due to mismatch of turnover as per Form 26AS
ABCAUS Case Law Citation:
ABCAUS 3943 (2024) (04) ITAT
In the instant case, the assessee had challenged the order passed by the NFAC in dismissing in limini the appeal of the assessee against the order passed u/s 143(1) of the Act by the CPC Bengaluru.
The assesse was a Kachaa Aarhtiya selling goods purchasing from different farmers. During impugned assessment year the TDS was deducted from the payments to the assessee under different heads.
The assesse filed the return u/s 139(1) of the Act. The return was processed u/s 143(1). During the processing of return U/s 143(1) of the Act the AO noticed that there was a difference in turnover filed in ITR with 26AS against the TDS.
Considering the mis-match of the TDS amount, the AO disallowed the amount by applying the proportionate method out of the total TDS amount.
Aggrieved, assessee filed an appeal before the CIT(A). The CIT(A) passed the ex parte order and upheld the assessment order.
Being aggrieved, the assessee filed an appeal before the ITAT.
Before the Tribunal the assessee contended that the impugned order was passed ex parte so the assesse was not allowed a reasonable opportunity for filing evidence related to the demand raised during assessment proceedings.
It was submitted that demand was raised due to mis-match of gross receipt shown in ITR as compared to Form 26AS. However, TDS u/s 194Q was not related to sale.
It was also stated that the assesse was a farmer and was not acquainted in the computer system so the notices are duly ignored. The assessee prayed for remanding back the matter to the file of the CIT(A) for de novo appeal of the assesse
The Tribunal observed that due to TDS u/s 194Q on purchase of property, there was a mis-match of gross receipt in ITR as compared to gross amount of TDS as per Form 26AS. The difference of TDS was rejected by the AO in proceeding u/s 143(1) of the Act.
The Tribunal further noted that in both the stages the assessee had not got any opportunity to submit the documents in favour of his claim.
The Tribunal also observed that the assesse had pleaded that the difference of TDS 194Q was not related to sale it is related to purchase. However, during proceeding u/s 143(1), the assesse was not allowed to respond, so reasonable opportunity was denied to submit the documents in favour of his claim.
The Tribunal remitted back the matter to the file of the CIT(A) for de novo adjudication after giving the assessee a reasonable opportunity of hearing.
Download Full Judgment ABCAUS 3943 (2024) (04) ITAT Click Here >>
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