The Income Tax Appellate Tribunal (ITAT) Ahmedabad bench has directed the Assessing Officer to rectify the order passed without considering the TDS Statement under form 16 by invoking section 154 of the Income Tax Act, 1961 and held that the employer is responsible for less deduction of TDS.
The assessee, MarkandIndraprasad Bhatt had declared income of Rs. 24,26,62,205/- under the head salary and capital gain income in the return of income filed u/s 139 of the Act for the year under consideration. The assessee after a certain period of time realized that he had offered the salary income in the ROI by exceeding Rs. 5,32,603/- mistakenly which is over and above the actual salary income. The actual salary income was of Rs. 24,00,39,600/- (including perquisite of Rs, 39,600/-) as evident from Form 16 and 26AS.
The assessee,filed an application u/s 154 of the Act to rectify the mistake apparent from records on the grounds that the income was offered higher than the actual income.
As such, the details about the salary appearing in form 16 was filed by the employer as well as details of TDS appearing in Form 26AS was available to the department. Therefore the department/income tax authority as referred u/s 119 of the Act could have corrected the mistake.
A bench of Ms Suchitra Kamble, Judicial Member and Shri Waseem Ahmed, Accountant Member observed that the salary disclosed by the employer of the assessee while filing the form 16 of the employee, it is evident that the assessee has received the salary amount on which the TDS is deducted if the same are not taken into consideration, then the employer is questionable upon the less TDS deduction and deposit.
“The mistake could be rectified if the same is apparent from the record. The plain meaning of the word “apparent” is that it must be something which appears to be so exact and incapable of argument or debate. It, therefore, follows that a decision on a debatable point of law or fact or failure to apply the law to a set of facts, which remain to be investigated, cannot be corrected by way of rectification. A mistake apparent on the record must be an obvious and patent mistake and not something which can be established by a long drawn process of reasoning on points on which there may be conceivably two opinions; a decision on a debatable point of law is not a mistake apparent from record,” the Tribunal said.
“Moreover, form 16 issued by the employer for a year is a very relevant document through which assessee file the return of income declaring income under the head salary, which has been ignored by the lower authorities,” the Tribunal added.
Allowing the plea of the assessee, the Tribunal held that “The assesseehas the opportunity to file revise return of income by following the provision of section 139(5) of the Income Tax, however he lost the opportunity but that does not mean that the mistake made by the assessee cannot be corrected. As such the provisions of section 154 of the Act are applied for both i.e. for assesseeas well as income tax authority referred u/s 119 of the Act. Thus we hold that there is a mistake apparent from record which needs to be rectified under the provisions of section 154 of the Act.”
Shri Biren Shah appeared for the assessee.
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