ITAT remands Maruti Suzuki tax credit dispute to AO for verification of unpaid refund claims

By | December 1, 2025
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ITAT remands Maruti Suzuki tax credit dispute to AO for verification of unpaid refund claims

Issue

Whether the CIT(A) erred in directing a refund of Rs. 3.20 Crores to the assessee by accepting their calculation of taxes paid without affording the Assessing Officer (AO) an adequate opportunity to verify the records and the order giving effect to the previous ITAT ruling.

Facts

  • Background: The assessee, Maruti Suzuki India Ltd., is a public limited company manufacturing cars. The dispute pertains to the Assessment Year 1997-98.

  • Prior Litigation: Assessment was completed under Section 143(3). After various rounds of litigation, the ITAT granted certain relief to the assessee on 29.10.2010.

  • Effect-Giving Order: The AO passed an order on 27.01.2012 to give effect to the ITAT’s 2010 order.

  • Disputed Calculation: In this order, the AO allowed credit for taxes already paid amounting to Rs. 284,21,48,943/-. However, the assessee claimed the correct amount of tax paid was Rs. 287,42,36,862/-, leading to a differential refund claim of Rs. 3,20,87,719/-.

  • CIT(A) Ruling: The assessee appealed to the CIT(A), who verified the figures from previous orders and directed the AO to issue the balance refund of Rs. 3.20 Crores plus interest.

  • Revenue’s Appeal: The Revenue challenged this, arguing the CIT(A) should not have directed the refund without allowing the AO to verify the records. The ITAT initially dismissed the Revenue’s appeal but later recalled the order via a Miscellaneous Application to decide these specific grounds.

Decision

  • Verification Necessity: The Tribunal observed the discrepancy between the tax credit figures adopted by the AO and those claimed by the assessee in the computation sheet.

  • Missing Evidence: It was noted that the order dated 19.12.2008, which was the basis for the AO’s calculation of credit, was not produced before the Tribunal.

  • Remand to AO: The ITAT held that an opportunity must be allowed to the AO to make necessary verifications of facts regarding whether due credit of taxes paid was allowed.

  • Direction: The AO was directed to verify the records and give credit for the correct amount. The assessee was directed to produce all evidence of taxes paid.

  • Outcome: The appeal of the Revenue was partly allowed for statistical purposes (remanded).

Key Takeaways

Verification Rights: Even when an appellate authority (like CIT(A)) finds a calculation error in an effect-giving order, the Assessing Officer should generally be given the opportunity to verify the underlying payment records (challans, etc.) before a refund is mandated.

Burden of Proof: In disputes regarding tax credits in old matters (e.g., 1997-98), the burden lies heavily on the assessee to produce historical evidence of taxes paid to claim the correct credit.

THE INCOME TAX APPELLATE TRIBUNAL
DELHI “E” BENCH: NEW DELHI
The DCIT, Circle 6(1),
vs
New Delhi – 110070
Date of Pronouncement 28.10.2025
ITA No.602/Del/2014

Source :- 1764330493-exwjue-1-TO