Same Income cannot be Taxed in Two Assessment Years Simultaneously as per the Scheme of Taxation: ITAT [Read Order]

The Income Tax Appellate Tribunal ( ITAT ) Ahmedabad while considering an appeal held that “The same income cannot be taxed in two assessment years simultaneously as per the scheme of taxation. Thus, while the assessee may not be permitted to defer the tax liability of income of the present year to the next year, the Revenue at the same time cannot sit over the taxes wrongly paid for the income already assessed in the preceding assessment year AY 2011-12 and refusing to refund the same in AY 2012-13.”

The statement was made in the appeal hearing of Shri Keyur D Gandhi HUF v. ACIT. The tribunal was headed by Shri Pradip Kumar Kedia, & Shri Mahavir Prasad. The brief facts of the case were that the sale transactions of two properties happened in AY 2011-12 was wrongly accounted for and offered to taxation in AY 2012-13. However, upon confrontation by AO, the assessee duly paid tax incorrect AY 2011-12. The dispute arose when the authorities failed to refund the tax collected on the income in AY 2012-13 while simultaneously collecting the taxes in AY 2011-12.

The tribunal considered whether the Commissioner of Income Tax Appellate erred in law and on facts by confirming disallowance of interest expense paid to Kotak Mahindra Prime Ltd made u/s 40(a) (ia) of the Act for non-deduction of tax at source and other grievances. The tribunal quoting the ratio in ITO vs. Arvind Lifestyle Brands Ltd. in ITA No.3461/Ahd/2015 restored the file to AO. The tribunal further stated that it shall be open to the assessee to furnish necessary evidence to show that payee has filed returns and has included the receipt from the assessee for the purposes of taxation.

The tribunal has further directed the AO to refund the taxes collected in AY 2012-13 in accordance with law after ascertaining the fact of the taxes recovered on the same income in AY 2011-12.

The tribunal, however, dismissed additional ground challenging the disallowance of estimated disallowance of 20% of interest expenditure incurred of car loan as personal in nature. The tribunal clarified that the additional ground cannot be permitted to be raised at this stage where necessary evidence is not available on record. The tribunal further asserted that the assessee cannot raise additional ground without good reason at a belated stage without showing its bonafide.