Dear Sir,
For AY 2017-18 income tax return of my client was filed by himself on 09 Dec 2017, in that return the refund of TDS of Rs 4902/- (under sec 194D / Insurance commission) was claimed and same was processed successfully on 01 Jan 2018 and refund of Rs 4920/-was paid on 10 Jan 2018.
However the said client came to me in Dec 2018 and informed me that Refund of Rs 399890/- was pending for AY 2017-18. I checked his income tax status on income tax portal and found that his Income Tax return for AY 2017-18 is processed.
On scrutiny of his 26AS, I found that TDS credit of Rs 399890/- (under sec 194C/payments to contractors) and Rs 4902/- (under sec 194D / Insurance commission) was there, out of which TDS credit of Rs 399890/- is not claimed in his income tax return. On further inquiry he told me that he received payment of Rs 3998900/- as compensation of land acquired by govt for irrigation purpose. On the basis of all these information, on 11 Dec 2018 I filed revised return for AY 2017-18 and claimed refund of Rs 404790/- (4902/- + 399890/-).
On 24 Jan 2019 I received intimation u/sec 143(1) and found that they did not considered refund claim of the TDS of Rs 399890/-. On further scrutiny on income tax portal we found tax credit mismatch of Rs 399890/-. On 14 Feb 2019 we submitted rectification request as “only reprocess the case”. Further on 23 Mar 2019 we received rectification order U/Sec 154 as “No demand No refund” and details of unmatched TDS of Rs 3,99,890/- with valid TAN flag “Yes”. It is pertinent to mention that there is no tax credit mismatch according to income tax portal as on today.
Now my first query is that, How to claim refund of Rs 399890/- ? And another query is, shall I go to the deductor to change the sec of TDS from 194C to 194A as the payment is interest on compensation of land acquired by govt for irrigation purpose?
Regards and eagerly waiting for expert opinion.
CAclubindia
