By C. N. Vaze, Shailesh Kamdar, Jagdish T. Punjabi, Bhadresh Doshi Chartered Accountants
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Section 246A – where the credit of foreign taxes
paid is not given by the assessing officer, appeal against the same to
the CIT(A) is maintainable.
Facts:
The assessee
filed IT return of income electronically, claiming tax credit u/s 90 and
91 to the extent of Rs. 8,38,764. While passing the assessment order
and determining the tax liability, the AO ignored this tax credit and
determined the amount to be refunded to the assessee. Aggrieved by this,
the assessee filed an appeal to the CIT(A). The CIT(A) did not accept
the appeal on the ground that section 246A did not permit such issues
within its ambit. He observed that the provisions of cl. (B) of s/s (1)
of section 246A refer to “tax” only for calculation of tax on total
income and not beyond that. According to him, the definition of “tax” in
section 2(43) refers to only income chargeable under the provisions of
this Act and hence, the question of tax is to be restricted only to tax
on total income. As the assessee was not challenging the calculation of
tax on total income, the CIT(A) held the appeal was not maintainable.
Held:
On
going through the mandate of clause (a) of section 246(1), it is clear
that an assessee has the right to appeal to the CIT(A) against inter
alia, “any order of assessment under s/s (3) of section1 43”, income
assessed, or to the amount of tax determined etc.
When we see
the expression “amount of tax determined” in juxtaposition to any “order
u/s 143(3)”, it becomes approved that the reference in the provision is
to the determination of the final amount of tax, which is distinct from
income assessed or the amount of loss computed or the status under
which the assessee is assessed.
Considering the judgment of
Hon’ble Supreme Court in M.Chockalingam & M. Meyyappan v. CIT (48
ITR 34) (SC) it appears that the same expression, viz., “amount of tax
determined” as employed in section 246(1) (a), encompasses not only the
determination of the amount of tax on the total income but also any
other act of omission which has the effect of reducing or enhancing the
total amount payable by the assessee. As the question of not allowing
relief in respect of withholding tax under section 90/91 has the effect
of reducing the refund or enhancing the amount of tax payable, such an
issue is squarely covered within the ambit of section246(1)(a).
