TDS credit denial where additional evidence admitted and matter remitted to AO for verification and allowance

Denial of TDS credit due to non-production of supporting documents was considered where tax was already deposited and omission was found to be bona fide; additional evidence was admitted and the claim directed to be considered. The Tribunal allowed filing of additional evidence, restored the matter to the assessing officer for verification and directed allowance of TDS credit if substantiated within 60 days; grounds were allowed for statistical purposes and no prejudice to revenue was found given lawful tax payment.

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Issues: Whether the Tribunal should admit additional documentary evidence under Rule 29 of the Income Tax (Appellate Tribunal) Rules, 1963 and restore the matter to the Assessing Officer for verification and grant of TDS credit claimed by the assessee for AY 2020-21.

Analysis: The Tribunal examined Rule 29 and supporting authorities on admission of additional evidence, including circumstances where evidence could not be produced earlier due to bonafide belief that existing material sufficed and where no mala fide conduct was shown. The Tribunal considered that the TDS had been lawfully deducted and deposited, that the appellant furnished reasons for non-filing earlier (bona fide belief and no request by lower authorities to produce the documents), and that admission would not prejudice the revenue. Rule 30 was applied to permit the Tribunal to direct production of documents before the Assessing Officer for verification and further proceedings. The Tribunal concluded admission was necessary in the interest of justice to enable proper adjudication of the TDS credit claim.

Conclusion: The additional documentary evidence is admitted under Rule 29 and the case is restored to the Assessing Officer to consider the evidence within 60 days and verify and allow the TDS credit as per law. The appeal is allowed for statistical purposes in favour of the assessee.

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