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Query on TDS and Gross receipt mismatch between IT Submitted and 26AS

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NITIN SABOO

272 Points Posted on 23 February 2020

Hello, One of my Client submitted Income Tax Return ITR 4 of FY 2018-19 with Gross Receipt of Rs45 Lakhs.
There is a notice of Mismatch with Form 26AS.
In 26 AS Gross receipt Shown Rs65Lakh and TDS deducted there on.
Rs65 Lakh Break up :-
45 Lakh Acutal work of 2018-19 as per Books
15 Lakh GST
5 Lakh Advance
please suggest how to reply of Notice in this case.

Replies (2)

Quick Summary

A client's Income Tax Return (ITR 4) for FY 2018-19 reported gross receipts of £45 Lakhs. However, Form 26AS shows £65 Lakhs, with TDS deducted on this higher amount. The £65 Lakhs includes £45 Lakhs of actual work, £15 Lakhs for GST, and £5 Lakhs in advance payments. The query is how to respond to the mismatch notice from the tax department, especially after an initial reply was sent and a further defective notice was received.

Nandakumar K Konkar

Partner

150 Points Posted on 23 February 2020

I assume that your client has got notice u/s 143(2). In my view: (1) no TDS is deductible for GST component in assessee's income, it may be deducted by mistake by deductor. (2) assuming you follow mercantile system of accounting, you should be accounting for advance in next year (FY 2019-20), when transaction is done & you raise final invoice; hence you may offer both advance of Rs. 5 Lakhs & TDS thereon in next AY 1920. I suggest that you may state these facts in your reply subject to your professional judgement.

NITIN SABOO

272 Points Posted on 23 February 2020

Sir, thanks for reply. we already sent reply of facts, but again defective notice sent by department, please suggest what to do.
how to show in revise return by this facts? please advice