Mistake of Including Service Tax paid on Rent in Form 26AS can be Rectified: ITAT [Read Order]

The Ahmedabad Bench of Income Tax Appellate Tribunal ( ITAT )has held that the mistake of including service tax paid on rent which was in the form 26AS could be rectified.

The assessee-Taraben Jayantilal Patel received an intimation under Section 143(1) of the Income Tax Act 1961 in which the income from house property was made at Rs.34,18,839/- instead of Rs.32,86,544/- as computed by the appellant. The appellant filed a rectification application against the intimation order explaining the reason that the appellant had computed ‘income from house property’ excluding service tax whereas in Form 26AS was inclusive of service tax. Accordingly, an order of computed income at Rs.37,12,839/- instead of Rs.32,86,544/- was passed.

Parin Shah, who appeared for the appellant submitted that the order had only complied with the annual value of property including the service tax on the basis of Form 26AS. Whereas the appellant had shown the rent received after reducing the service tax as the service tax was payable by the tenant of the property.

 V. K. Mangla, on behalf of revenue contented that the service liability was on the appellant as the appellant had not submitted the copy of agreement to the effect that service tax was payable by the tenant.

  The tribunal bench of Pramod M Jagtap (Vice President) and Mahumita Roy (Judicial Member) deleted the addition and held that such mistakes could be rectified observing,

    “Service tax was included in the income from house property computed by the assessee but the amount mentioned in Form 26AS in inclusive of service tax. This is because the reason that assessee has deducted TDS on rent inclusive of service tax instead of exclusive service tax which has been duly reconciled by the assessee with sufficient evidence adduced before the authorities below as it appears from materials available before us, in our considered opinion, which has not been taken into consideration with its proper perspective.”

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