TMI Blog2004 (6) TMI 289X X X X Extracts X X X X X X X X Extracts X X X X ..... 4 and Avon Industries Ltd. issued a TDS certificate for an amount of Rs. 3,90,280. As per the provisions of the Income-tax Act, 1961, the dividend is assessable to tax in the year in which it is declared, distributed or paid. Admittedly, the dividend was declared during the previous year relevant to assessment year 1995-96, but because of the consistent practice followed by the assessee, it was wrongly offered to tax in the assessment year 1994-95 and that was accepted by the Assessing Officer by assessing the same as income of the assessee for assessment year 1994-95. However, the assessee claimed credit for TDS in the assessment year 1995-96: as per section 199 of the Income-tax Act, 1961, the credit for TDS has to be given in the year in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tral Government shall be treated as a payment of tax on behalf of the person from whose income the deduction was made, or of the owner of the security, or depositor or owner of property or of unit-holder or of the shareholder, as the case may be, and credit shall be given to him for the amount so deducted on the production of the certificate furnished under section 203 in the assessment made under this Act for the assessment year for which such income is assessable :". The learned counsel submitted that under section 199 of the Act, the year in which the dividend income is actually assessed should not be taken as the criterion for giving credit for TDS amount since the expression 'assessable' signifies that the assessment year in which th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... TDS amount. 5. We have carefully considered rival submissions and perused the record. Section 8(a) of the Act, in no uncertain terms, provides for bringing to tax dividend income only in the year in which the dividend is declared, distributed or paid. In the instant case, it is not in dispute that by applying section 8(a) of the Act, the dividend income is assessable to tax only in the assessment year 1995-96. Section 199 of the Act provides for giving credit to the assessee for the amount of tax deducted at source by the company declaring the dividend. The Legislature in its wisdom has amended section 199(1) with effect from 1-6-1987 whereby the expression 'assessable' was used to decide the year in which the credit has to be given. The ..... X X X X Extracts X X X X X X X X Extracts X X X X
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