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2018 (12) TMI 453 - AT - Income TaxDenial of credit of TDS - corresponding income has not been offered to tax - TDS belongs of assessee or HUF - Exemption u/s 10(37) claimed by HUF - contention of the assessee that once TDS certificates are in the name of the assessee and credit for such TDS is appeared in the name of the assessee in AIR data base and also the fact that the 6 particular income is not taxable either in the hands of the assessee or in the hands of the HUF credit for TDS cannot be rejected. Held that:- We find merit in the arguments of the assessee for the reason that when a particular income is exempt from tax in view of specific provisions provided under section 10(37) of the Act and also the fact that the HUFs have declared the compensation received on account of compulsory acquisition of agricultural land in their return of income and claimed exemption under section 10(37) there is no reason for AO to deny credit for TDS merely on the ground that no income has been offered to tax in the hands of the assessee. As compensation received on account of compulsory acquisition of agricultural land is exempt from tax under section 10(37) - HUFs have declared the said compensation in the return of income. It is also undisputed that the HUFs have not claimed credit for TDS in their return of income. Therefore, when the facts are clear in respect of exemption of particular receipt in the hands of the assessee as well as HUFs, the question of offering such income for tax in the hands of the assessee does not arise. When the credit for such TDS is appearing in the name of the assessee in AIR data base and the assessee has furnished necessary TDS certificate in his name, the Assessing Officer erred in rejecting the claim of credit for TDS by citing the provisions of section 199 of the Act r/w rule 37BA of the I.T. Rules. This legal position is supported by the findings of the Hon’ble Delhi High Court in Relcom [2015 (11) TMI 284 - DELHI HIGH COURT] wherein the Court held that this Court relies upon the well settled dictum for procedure is the hand made of justice and it cannot be used to hamper the cause of justice. Therefore, the Revenue’s contention that the assessee instead of claiming the entire TDS amount ought to have sought a correction of vendor’s mistake would unnecessarily prolonged the entire process of seeking refund based on TDS credit. AO erred in denying credit of TDS to the assessee - Decided in favour of assessee.
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