HUF’s Entitlement to ₹9.32 Lakh TDS Credit Requires Proof Members Did Not Claim It: ITAT Remands Matter for Verification [Read Order]
Tax was deducted at source at the rate of 1% separately in the names of the Karta of the HUF and a member of the HUF, even though the property belonged to the HUF
In a recent ruling, the Agra bench of the Income Tax Appellate Tribunal (ITAT) held that credit on Tax Deducted at Source (TDS) claimed by a Hindu undivided family (HUF) cannot be denied mechanically and must be allowed if it is established that the karta and members of the HUF have not claimed the same credit in their individual returns.
The appeal was filed by appellant Suresh Chand Agarwal HUF against the order of assessment passed under section 154 of the IncomeTax Act 1961, by the AO for assessment year 2023-24, denying the entire TDS credit of ₹9.32 lakh.
The assessee, Suresh Chand Agarwal HUF, argues that since the property was owned by the HUF, the entire TDS of ₹9.32 lakh was rightly claimed in the HUF’s return of income. It was further submitted that neither the karta nor the member had claimed the said TDS credit in their respective returns, a fact duly disclosed in the TDS schedules and supported by documentary evidence.
While processing the return under section 143(1), the CPC allowed TDS credit only to the extent of ₹4.66 lakh and denied the balance, and through a rectification order under section 154, even the credit originally granted was withdrawn on the ground of a mismatch in form 26AS.
However, tax was deducted at source at the rate of 1% separately in the names of the Karta of the HUF and Rajni Agarwal (member of HUF), even though the property belonged to the HUF.
The tribunal observed that the lower authorities failed to verify whether the karta of HUF and Rajni Agarwal (member of HUF) had claimed the TDS credit in their individual returns.
The bench, Shri M. Balaganesh (Accountant Member), set aside the impugned orders and remanded the matter to the assessing officer for fresh adjudication. The tribunal directed that if it is found that the TDS credit of ₹9.32 lakh has not been claimed elsewhere, the same shall be granted to the assessee HUF. accordingly the appeal was allowed for statistical purposes.
Support our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates
