2021 (10) TMI 902 - AT - Income Tax

Appeals Allowed for TDS Credit Disallowance under IDS 2016

The Tribunal allowed the appeals of Anil Kharia and Tripti Kharia regarding the disallowance of TDS credit on bank interest under IDS 2016. The Tribunal ... Credit of TDS - tds deducted on the interest income which accrued the investments offered to tax under the ‘Income Declaration Scheme 2016’ - Credit for TDS has not been allowed only for the reason that PAN No. of the payee is not mentioned in the certificate due to which tax credit is not appearing in the income tax portal - HELD THAT:- It is an evident fact that since the investments was unaccounted, assessee had not given the PAN to the Bank where such investments were made. However, since the assessee has declared the income under IDS 2016, now the assessee is eligible to get credit for TDS as provided in the clarification on the IDS 2016 vide circular no.25/2016 dated 30th June 2016. Necessary verification should be made at the level of the Ld. AO, before whom assessee shall provide all the details of IDS 2016, certificate of tax deducted in the name of self and children and also provide complete details of TDS - If after the necessary verification it is proved that the alleged IDS was deducted on the income/investment declared under IDS 2016 comprising of the principle amount of the investments and interest earned thereon, then the assessee should be allowed the benefit of tax deducted at source - Needless to mention that proper opportunity of being heard to be provided to the assessee. - Assessee appeal allowed for statistical purposes. Issues:- Disallowance of TDS credit on bank interest under IDS 2016- Disallowance of TDS credit in the name of relatives under IDS 2016Analysis:1. The appeals were against the order of the Ld. Commissioner of Income Tax (Appeals) regarding the disallowance of TDS credit on bank interest under the Income Declaration Scheme 2016 (IDS 2016). The Assessee, Anil Kharia, and Tripti Kharia raised similar grounds of appeal related to TDS credit disallowance.2. The Tribunal heard both appeals together due to common issues. The facts and issues were similar for both assessees, and the decision in Anil Kharia's case was applied to Tripti Kharia's case.3. The Assessee, an individual, declared unaccounted investments under IDS 2016. The total income declared was &8377; 76,89,304, and TDS claimed was &8377; 4,22,140. However, only &8377; 1,29,132 TDS credit was allowed in the intimation under section 143(1) of the Income Tax Act.4. The Assessee contended that TDS of &8377; 2,52,431 was not credited, as it was not appearing in Form 26AS due to unaccounted investments. The Ld. CIT(A) did not accept this argument.5. The Assessee appealed to the Tribunal, claiming that TDS credit was not allowed on the interest income accrued on investments declared under IDS 2016. The Assessee provided relevant documents and circulars to support the claim.6. The Departmental Representative supported the Ld. CIT(A)'s order, leading to a dispute over the TDS credit disallowance of &8377; 2,52,431.7. After hearing both sides, the Tribunal observed that the main issue was the denial of TDS credit claimed at &8377; 2,52,431 on interest income from investments declared under IDS 2016.8. The Tribunal noted that the Assessee had not claimed the TDS amount in any return. The circular clarified that credit for tax deducted on declared income under IDS 2016 should be allowed if not claimed previously.9. Considering the facts, the Tribunal directed the Ld. AO to verify the details of IDS 2016, tax certificates, and TDS amount of &8377; 2,52,431. If verified, the Assessee should be allowed the TDS credit, providing a fair opportunity for explanation.10. The Tribunal applied the same reasoning and decision to Tripti Kharia's appeal, allowing the TDS credit claim of &8377; 1,79,702 under IDS 2016.11. Consequently, the appeals of both Anil Kharia and Tripti Kharia were allowed for statistical purposes, with directions for verification and allowance of TDS credit as per the Income Declaration Scheme 2016.12. The order was pronounced on 13.09.2021 as per Rule 34 of ITAT Rules, 1963.