The deductor credited the TDS late, so it turned up in 26AS only after I had filed. The department says I should have revised my return, and refuses credit because I never offered the income to tax. Is there a way back?
Yes - s.155(14). The Delhi High Court held that s.155(14) places the Assessing Officer under a statutory obligation to amend the assessment or intimation once the certificate or the updated Form 26AS is produced, and that the sub-section neither contemplates nor mandates the original return being amended or revised. It also held that the Commissioner was wrong to require the income to be offered to tax where the assessee had consistently and uncontestedly said the receipt was not taxable in India.
Decided by the High Court (Yashwant Varma J and Ravinder Dudeja J) on 2024-09-03, reported as W.P.(C) 14280/2023 (High Court of Delhi at New Delhi). It bears on section 155(14), section 199, section 264, section 143(1), section 143(3), section 154, section 203, section 90 of the Income Tax Act 1961, in TDS Defaults, Refunds, Interest & Condonation and Revision & Rectification matters.
Section 155(14) is the statutory route back for a credit lost because the certificate was not filed with the return, and it is almost never used - it carries an obligation on the officer, a two-year window from the end of the assessment year in which the income is assessable, and it works on an intimation under s.143(1) as much as on an assessment order. Two practical points come out of the case. First, the department's habitual answer - 'you should have filed a revised return' - is not a legal answer, because the sub-section is designed for exactly the case where the credit surfaced after filing. Second, the officer's refusal is amenable to a s.264 revision and, if that fails, to a writ; here the s.264 order was quashed and refund with statutory interest was directed. Read the proviso before relying on the case: s.155(14) is expressed not to apply unless the income from which the tax was deducted has been disclosed in the return for the relevant year, and the Court did not analyse that proviso against these facts, where the receipt was returned as not taxable.
Binding within that High Court's jurisdiction. Persuasive elsewhere.
Read aloud by your device. Press again to stop.
The petitioner, a non-resident, filed its return for AY 2015-16 on 30 September 2015 declaring nil taxable income on the footing that a receipt of Rs.1,37,84,935 was not taxable in India under s.90, and claimed refund of TDS of Rs.1,90,84,170 as reflected in Form 26AS, including Rs.5,95,549 deducted by Bajaj Allianz Life Insurance Company. BALIC credited the TDS for the last quarter of FY 2014-15 only on 21 January 2016, by which time the return for AY 2015-16 had been filed; the further sum of Rs.1,48,16,294 therefore surfaced in Form 26AS afterwards and was claimed in the return for AY 2016-17 filed on 29 September 2016. The AY 2015-16 assessment was completed under s.143(3) on 21 December 2017 with no addition. The AY 2016-17 return was processed under s.143(1) on 28 March 2018 and the credit denied. An online rectification application could not be entertained by CPC because records had moved to the jurisdictional officer; a physical rectification application filed on 12 November 2018 was never disposed of; a s.264 revision lodged on 20 December 2018 was dismissed on 27 March 2021 on the grounds that the income had never been offered to tax and that the petitioner should have revised its return.
The writ petition was allowed, the s.264 order dated 27 March 2021 quashed, and the respondents commanded to refund Rs.1,48,16,294 with statutory interest forthwith. Section 155(14) places the Assessing Officer under a statutory obligation to amend the assessment order or intimation once the statutory contingencies are established, and neither contemplates nor mandates the original return being amended or revised (paras 15 to 18).
The deduction by BALIC and its late crediting were undisputed and appeared in Form 26AS. The Commissioner's first ground - that credit could not be given because the income was never offered to tax - was held misconceived: the petitioner had consistently asserted that the receipt was not taxable in India under s.90, the AY 2015-16 return had been accepted under s.143(3) without addition, and even at the date of the judgment no decision had been taken holding the receipt taxable, so the assertion stood uncontested. The second ground - that the return should have been revised - was tested against s.155(14), which the Court set out in full. The sub-section addresses precisely the contingency of TDS being credited or appearing in Form 26AS after a time lag, and the statutory answer to that contingency is the amendment of the assessment or intimation, not the revision of the return. Once the updated Form 26AS is placed before the Assessing Officer, he is obliged to acknowledge it and amend the assessment accordingly; the refusal to refund was therefore illegal and arbitrary.
Section 155(14) thus places the AO under a statutory obligation to amend the order of assessment once it is established that the contingencies alluded to in that provision are duly established. Sub-section (14) neither contemplates nor mandates the original return being amended or revised.
Upload it and we will read it, work out your deadline and draft the reply. A CA reviews before anything is filed.
Handle my notice → Ask a CA on WhatsAppYes - s.155(14). The Delhi High Court held that s.155(14) places the Assessing Officer under a statutory obligation to amend the assessment or intimation once the certificate or the updated Form 26AS is produced, and that the sub-section neither contemplates nor mandates the original return being amended or revised. It also held that the Commissioner was wrong to require the income to be offered to tax where the assessee had consistently and uncontestedly said the receipt was not taxable in India. This was decided by the High Court (Yashwant Varma J and Ravinder Dudeja J) and bears on section 155(14), section 199, section 264, section 143(1), section 143(3), section 154, section 203, section 90 of the Income Tax Act 1961. It is reported as W.P.(C) 14280/2023 (High Court of Delhi at New Delhi). Section 155(14) is the statutory route back for a credit lost because the certificate was not filed with the return, and it is almost never used - it carries an obligation on the officer, a two-year window from the end of the assessment year in which the income is assessable, and it works on an intimation under s.143(1) as much as on an assessment order. Two practical points come out of the case. First, the department's habitual answer - 'you should have filed a revised return' - is not a legal answer, because the sub-section is designed for exactly the case where the credit surfaced after filing. Second, the officer's refusal is amenable to a s.264 revision and, if that fails, to a writ; here the s.264 order was quashed and refund with statutory interest was directed. Read the proviso before relying on the case: s.155(14) is expressed not to apply unless the income from which the tax was deducted has been disclosed in the return for the relevant year, and the Court did not analyse that proviso against these facts, where the receipt was returned as not taxable. If it applies to you, the first step is this: Diarise the s.155(14) limitation: the certificate must be produced before the Assessing Officer within two years from the end of the assessment year in which the income is assessable.
The petitioner, a non-resident, filed its return for AY 2015-16 on 30 September 2015 declaring nil taxable income on the footing that a receipt of Rs.1,37,84,935 was not taxable in India under s.90, and claimed refund of TDS of Rs.1,90,84,170 as reflected in Form 26AS, including Rs.5,95,549 deducted by Bajaj Allianz Life Insurance Company. BALIC credited the TDS for the last quarter of FY 2014-15 only on 21 January 2016, by which time the return for AY 2015-16 had been filed; the further sum of Rs.1,48,16,294 therefore surfaced in Form 26AS afterwards and was claimed in the return for AY 2016-17 filed on 29 September 2016. The AY 2015-16 assessment was completed under s.143(3) on 21 December 2017 with no addition. The AY 2016-17 return was processed under s.143(1) on 28 March 2018 and the credit denied. An online rectification application could not be entertained by CPC because records had moved to the jurisdictional officer; a physical rectification application filed on 12 November 2018 was never disposed of; a s.264 revision lodged on 20 December 2018 was dismissed on 27 March 2021 on the grounds that the income had never been offered to tax and that the petitioner should have revised its return. The matter was decided on 2024-09-03 by the High Court (Yashwant Varma J and Ravinder Dudeja J). On those facts the High Court held as follows. The writ petition was allowed, the s.264 order dated 27 March 2021 quashed, and the respondents commanded to refund Rs.1,48,16,294 with statutory interest forthwith. Section 155(14) places the Assessing Officer under a statutory obligation to amend the assessment order or intimation once the statutory contingencies are established, and neither contemplates nor mandates the original return being amended or revised (paras 15 to 18).
The deduction by BALIC and its late crediting were undisputed and appeared in Form 26AS. The Commissioner's first ground - that credit could not be given because the income was never offered to tax - was held misconceived: the petitioner had consistently asserted that the receipt was not taxable in India under s.90, the AY 2015-16 return had been accepted under s.143(3) without addition, and even at the date of the judgment no decision had been taken holding the receipt taxable, so the assertion stood uncontested. The second ground - that the return should have been revised - was tested against s.155(14), which the Court set out in full. The sub-section addresses precisely the contingency of TDS being credited or appearing in Form 26AS after a time lag, and the statutory answer to that contingency is the amendment of the assessment or intimation, not the revision of the return. Once the updated Form 26AS is placed before the Assessing Officer, he is obliged to acknowledge it and amend the assessment accordingly; the refusal to refund was therefore illegal and arbitrary. In the words reproduced by the source cited on this page: "Section 155(14) thus places the AO under a statutory obligation to amend the order of assessment once it is established that the contingencies alluded to in that provision are duly established. Sub-section (14) neither contemplates nor mandates the original return being amended or revised."
It was decided by the High Court on 2024-09-03 and is reported as W.P.(C) 14280/2023 (High Court of Delhi at New Delhi). Binding within that High Court's jurisdiction. Persuasive elsewhere. A High Court decision binds the assessing officer, the Commissioner (Appeals) and the Income Tax Appellate Tribunal within that state, and is persuasive elsewhere. If your assessment is in a different jurisdiction, check whether your own High Court has taken the same view before relying on it. On section 155(14), section 199, section 264, section 143(1), section 143(3), section 154, section 203, section 90, the practical question is whether the facts of your own notice match the facts of this case closely enough for the same rule to apply.
It helps the taxpayer. The writ petition was allowed, the s.264 order dated 27 March 2021 quashed, and the respondents commanded to refund Rs.1,48,16,294 with statutory interest forthwith. Section 155(14) places the Assessing Officer under a statutory obligation to amend the assessment order or intimation once the statutory contingencies are established, and neither contemplates nor mandates the original return being amended or revised (paras 15 to 18). It arises in TDS Defaults, Refunds, Interest & Condonation and Revision & Rectification matters, on section 155(14), section 199, section 264, section 143(1), section 143(3), section 154, section 203, section 90 of the Income Tax Act 1961, and was decided by Yashwant Varma J and Ravinder Dudeja J. Before relying on it, read the source linked on this page and check whether it has since been distinguished, overruled or overtaken by an amendment to the Income Tax Act. In practice the steps that follow from it are these. Apply to the Assessing Officer under s.155(14) in writing, enclosing the updated Form 26AS and the s.203 certificate, and say expressly that the sub-section obliges him to amend the assessment or intimation and that s.154 applies to the amendment. Do not accept the answer that the return had to be revised first; that is what this judgment rejects. If the officer does not act, go to the Commissioner under s.264 - here the CPC route was closed because records had moved to the jurisdictional officer, and the physical rectification application was simply not disposed of. Where the underlying receipt is claimed to be non-taxable under a treaty, be ready on the proviso to s.155(14) about the income being disclosed in the return, and show that the receipt was in fact disclosed in the return even if returned as not chargeable. Ask for statutory interest on the refund, not just the refund.
Still good law. Decided 3 September 2024. Whether the Revenue has taken it further, and whether any other High Court has taken a different view of s.155(14), was NOT checked. No source could be cited for that finding. Checking whether an authority still stands matters as much as knowing what it held: a decision may be overruled on one point and survive on another, or the provision it interprets may have been amended since. Read the source and the editor's note on this page before relying on it in a reply to an Assessing Officer or in an appeal.
The judgment reproduces s.155(14) with its proviso, and that text - covering an intimation or deemed intimation under s.143(1), the two-year period, and the proviso requiring the income to have been disclosed in the return - is a reliable statement of the sub-section as at September 2024. The Court did not address how that proviso applies where, as here, the receipt was returned as not chargeable to tax in India; a reader relying on the case in a domestic-income setting should note that gap. A widely circulated professional alert dated 4 October 2024 describes this decision; the judgment itself is dated 3 September 2024. The s.264 order quashed is dated 27 March 2021 while the revision application was lodged on 20 December 2018. This library shows the verification state of every entry openly. This entry has not yet been read in full by a chartered accountant. The summary reflects the sources listed on this page. Read the source before you rely on it in a reply to an Assessing Officer or in an appeal before the Commissioner (Appeals) or the Income Tax Appellate Tribunal.
The writ petition was allowed, the s.264 order dated 27 March 2021 quashed, and the respondents commanded to refund Rs.1,48,16,294 with statutory interest forthwith. Section 155(14) places the Assessing Officer under a statutory obligation to amend the assessment order or intimation once the statutory contingencies are established, and neither contemplates nor mandates the original return being amended or revised (paras 15 to 18).
Every entry in this library links to where it was found, so you can check it yourself rather than take our word for it.
I hold a Mauritius TRC. Can the department still deny me treaty relief on the capital gains?
We charge fees for our public utility work. Does that cost us charitable status under s.2(15)?
My return was only processed under 143(1). Does that stop the department reopening it later?
No s.143(2) notice was issued at all. Does s.292BB save the assessment?