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2022 (2) TMI 344 - HC - Income TaxClaim for credit in respect of advance tax paid by a declarant under the Scheme, 2016 - character of the advance tax - Income Declaration Scheme, 2016 - Is advance tax entitled to the same dispensation as is given to the TDS? - Can a legally sustainable distinction be made between ‘TDS’ and ‘Advance Tax’ in the matter of credit to be given against the liability under the Scheme, 2016? - certificate in Form 4 as required by Rule 4(5) of the Income Declaration Scheme Rules, 2016 in respect of the income declared by the petitioner under the said scheme in Form 1 under Section 183 of the Finance Act, 2016 - HELD THAT:- Section 219 provides in clear and explicit terms that an assessee who pays advance tax shall be entitled to credit therefor in the regular assessment. From a conjoint reading of Sections 199 and 219, it becomes clear that in the matter of credit, the TDS and advance tax stand on the same footing. As there is no sustainable ground to make a distinction between ‘TDS’ and ‘Advance Tax’ for the purpose of credit, we do not find any reason not to equate an advance tax with TDS for the purpose of the Scheme, 2016. If a TDS is entitled to credit, a fortiori advance tax must get the same dispensation. It is true that the provisions of Chapter XVII primarily deal with regular assessment in respect of the liability to pay income tax founded in Sections 4 and 5 of the Act, 1961, which are the charging sections. It is also true that the provisions of Sections 184 and 185 of the Act, 2016 incorporating the Scheme, 2016, begin with a non obstante clause. However, the overriding effect of Sections 184 and 185 is confined to the rate at which the tax is to be imposed on the undisclosed income, surcharge to be paid thereon and the penalty. The substance of the matter, especially the fact that the advance payment made by the declarant retains the character of tax, however, cannot be lost sight of. In the case at hand, it is not the case of respondent No.1 that the advance tax paid by the petitioner was not relatable to the income for the relevant assessment years, which petitioner disclosed. If the said payment is not apportionable towards any other liability, there is no justifiable reason to deprive the declarant from getting the credit for the same against the liability under the Scheme, 2016 Petition stands allowed - Respondent No.1 shall issue certificate in Form 4 as required by Rule 4(5) of Income Declaration Scheme Rules, 2016, upon the petitioner complying with all the requirements under the said Scheme, 2016. However, the petitioner shall be entitled to and given credit for the advance tax already paid by the petitioner and the respondent No.1 shall not refuse to issue Form No.4 on the said count.
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