CEO denied TDS credit for unremitted amounts - Tribunal rules against self-benefit, pre-insolvency years

The Tribunal dismissed the appeals for assessment years 2018-19 and 2019-20, holding that the appellant, as the MD and CEO of a company, cannot claim credit for TDS that was never deposited. The Tribunal emphasized that the appellant cannot benefit from his own default and rejected the argument that the company's insolvency proceedings affected the TDS deposit, as the relevant financial years predated the insolvency process.

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Issues Involved:
1. Non-adjudication of the issue by CIT(A)
2. Denial of opportunity of hearing by CIT(A)
3. Unauthorized adjustment in computing tax liability and denial of TDS credit

Summary:

Non-adjudication of the issue by CIT(A):
The appellant claimed that once tax was deducted at source by the payer, the credit for the same should be given to the payee irrespective of whether the deducted tax was deposited by the payer with the Government. The appellant cited Section 205 of the Income Tax Act and Instruction No. 275/29/2014-IT-(B) dated 01.06.2015 to support this claim. The CIT(A) directed the AO to verify the claims and allow necessary relief, but the appellant was not satisfied and appealed further.

Denial of opportunity of hearing by CIT(A):
The appellant argued that the CIT(A) passed the order without giving an opportunity of hearing, violating the principles of natural justice. The Tribunal initially dismissed the appeal, noting that the CIT(A) had already directed the AO to verify and allow the necessary credit. However, the High Court of Calcutta restored the matter to the Tribunal for a fresh decision.

Unauthorized adjustment in computing tax liability and denial of TDS credit:
The appellant filed a return declaring a total income of Rs. 37,87,390/- and claimed a refund of Rs. 36,360/-. The return included details of TDS of Rs. 10,09,289/-, which was not reflected in Form 26AS. The CPC, Bengaluru, did not allow the TDS claim and charged interest under Sections 234B and 234C, resulting in a total demand of Rs. 11,58,260/-. The appellant contended that the department should recover the amount from the deductor and not levy it again on the assessee.

Tribunal's Final Decision:
The Tribunal noted that the appellant, being the MD and CEO of AMW Motors Ltd., was responsible for the deduction and deposit of TDS. The appellant cannot claim credit for TDS that was never deposited. The Tribunal dismissed the appeals, stating that the appellant cannot benefit from his own wrong or default. The Tribunal also dismissed the contention that the company's insolvency proceedings affected the TDS deposit, as the relevant financial years were before the insolvency process began. Both appeals for assessment years 2018-19 and 2019-20 were dismissed.

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