2024 (6) TMI 644

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.... "1. The CIT (Appeals) and the A.O. has erred in Confirming and making an addition of Rs. 4,83,000/- in the returned income on account of TCS payable in the Audit report 2. The CIT (Appeals) and the AO has erred in concluding that the TCS payable is claimed as an expenses by Appellant, in contradiction to the returned income filed by the appellant wherein TCS payable is not claimed as deduction 3. The CIT(Appeals) & and AO have erred in making addition u/s 43B of TCS payable which is neither an allowable expense nor has been claimed by the Appellant in his return. 4. Without prejudice to the above grounds The CIT (Appeals) have failed to appreciate that the amount of unpaid TCS Payable Rs. 4,83,000/- in the Tax Au....

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....t there has been a mistake in reporting the correct figure of TCS collection which is actually Rs. 4,10,834/- (instead of Rs. 4,83,000/- mentioned in tax audit report ), and has argued that the since the assessee has not made any claim of deduction of the above amount in the profit and loss account , the said amount is not hit by the provisions of section 43B of the Act 61, and as such the question of disallowing the deduction not claimed at all would not arise. 3.2 The first appellate authority was not convinced and the addition was sustained on the ground that the assessee should have taken adequate steps to rectify or revise the tax audit report in time (after detection of the error) and also due to the fact that the assessee has debi....

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....ged in the business of trading in Scrap and the provisions of section 206C(1) of the Act 61, is applicable on him for collection of provisions of section 206C(1) of the Act 61, is applicable on him for collection of tax at specified percentage of consideration of sales, as income tax. 6.1 The relevant provisions of section 206C(1) is reproduced below for ready reference: "206C [(1) Every person, being a seller shall, at the time of debiting of the amount payable by the buyer to the account of the buyer or at the time of receipt of such amount70 from the said buyer in cash or by the issue of a cheese or draft or by any other mode, whichever is earlier, collect from the buyer of any goods of the nature specified in column (2) of t....

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....[person responsible for----- collecting tax]. " 6.2 From the reading of various sub sections of sec 206C of the Act 61, it is clear that the tax collected by the assessee, under the provisions of this section, is the income tax portion of the buyer of the goods, which is collected by the assessee from the buyer, to be subsequently credited to the account of the Central Government within stipulated time frame provided by the statute. Sub section (6A) further provides that in case of failure of the assessee he shall be deemed to be an assessee in default in respect of the tax. The case of the assessee is covered by sub section (8), of the said section where the assessee has not paid the tax to the credit of the Central Government, after th....