M/s Merino Industries Limited vs. DCIT, TDS Circle 1(1), Kolkata

Parties Involved

Facts Summary

The assessee, M/s Merino Industries Limited, is a public limited company engaged in manufacturing activities with its head office in Kolkata. The assessee regularly files its quarterly TDS returns within the prescribed due dates. Upon processing of such TDS returns by the CPC (TDS) system, a total demand of ₹3,99,020/– was raised, out of which ₹3,91,150/– pertained to Form 27Q. The demand arose due to the application of a higher rate of tax at 20% in certain cases where CPC (TDS) treated the deductees as non-furnishing of PAN error. The assessee contended that tax had been duly deducted at appropriate rates under section 195 and paid to the Government account, and that the higher rate of 20% was erroneously applied by CPC due to system mismatch. The assessee had also filed necessary rectification requests and correspondence seeking deletion of the said demand, but no relief was granted. Subsequently, the Income Tax Officer (TDS), Circle–1(1), Kolkata issued demand notices purely on the basis of the CPC processing, without independent verification. Aggrieved thereby, the assessee preferred appeals before the Ld. CIT(A).…

Legal Issues

• 1. Whether the assessee failed to produce the order passed under section 201 dated 15.01.2025 before the Ld. CIT(A) and the Tribunal.

Judgment Outcome

Decided in favour of Revenue.

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