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2006 (6) TMI 182 - AT - Income TaxDeduction of Tax At Source - remitting payments to various shipping companies under time charter agreements - HELD THAT:- Once the amount of tax is deducted at source the person against whose income the tax is deducted could claim credit of that amount by filing the appropriate return. If tax is deducted on an amount which is not exigible to tax, the Assessing Officer makes refund of that amount after the completion of the assessment. Deduction of tax at source is a convenient method of tax collection since it effects early realization and is less painful to the person from whose income such tax is deducted. Moreover it saves time on the part of the revenue inasmuch as all calculation and other attendant work are performed by the person responsible for paying. It also acts as a check on tax evasion. In the present case it is found that the amount payable to the non-resident was exigible to tax. No tax was deducted on that amount. The Assessing Officer, therefore, rightly treated the assessee as an assessee in default in respect of the tax within the meaning of section 201 of the Act - the Commissioner (Appeals) took a correct view in the matter. Accordingly the impugned order for these two years upheld. For the same reasonings the order of the Commissioner (Appeals) for the assessment year 2003-04 reversed. Appeal of assessee dismissed.
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