The Income Tax Appellate Tribunal (ITAT), Bangalore Bench has revised its earlier order passed in December 2020 since the issue of disallowance of TDS credit was not considered in the said order, which constituted a ‘mistake apparent from the record.’
Last year, the Tribunal while considering various issues, had given relief to the Company and deleted the disallowance against Infosys BPM Ltd. and held that payments made to non-resident for acquiring off-the-shelf software are not royalty and no obligation to deduct TDS.
This year, the Company again approached the Tribunal stating that the Tribunal has not considered the issue of allowance of TDS credit of Rs.29,72,729 for the assessment year 2011-12, and the same constitutes a mistake apparent from the record as per section 254(2) of the Act.
Allowing the contentions of the assessee-Company, the Tribunal bench comprising Judicial Member Mr. George George Kand Accountant Member Mr. B.R. Baskaran held that the order needs to be modified. “As rightly pointed out by Ld. A.R., the issue regarding the incorrect allowance of TDS credit for the assessment year 2011-12 was not adjudicated at the time of disposal of the appeal cited (supra). Hence, there is a mistake apparent from the record in the order passed by the Tribunal,” the bench said.
Accordingly, the bench inserted a new paragraph to the order passed on 11th December, 2020 holding that “The last issue relates to claim of TDS credit. It is the contention of the assessee that TDS credit has not been correctly allowed. This claim requires verification of facts. Accordingly, we restore this issue to the file of AO with the direction to verify the claim of the assessee.”
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