TMI Blog2015 (6) TMI 66X X X X Extracts X X X X X X X X Extracts X X X X ..... tter including the provisions of section 199 as applicable to the assessment year 2006-07. The learned Departmental representative has also not been able to dispute this position clearly evident from the order of the Tribunal, a copy of which is placed on record before us. Moreover, the order passed by the Tribunal in the case of P. Srinivasa Rao (2011 (3) TMI 1495 - ITAT VISAKHAPATNAM) deciding a similar issue on merit in favour of the assessee clearly shows that the view taken by the Assessing Officer while allowing credit for the TDS made from mobilisation advance was a possible view and the learned Commissioner of Income-tax, in our opinion, was not justified in substituting his own view for such possible view taken by the Assessing Officer by his impugned order passed under section 263 as the same is not permissible under the provisions of section 263 as held in the case of Malabar Industrial Co. Ltd. v. CIT [2000 (2) TMI 10 - SUPREME Court]. We, therefore, set aside the impugned order of the learned Commissioner of Income-tax passed under section 263 and allow the appeal of the assesse - Decided in favour of assesse. - ITA.No.1361/Hyd/2013 - - - Dated:- 12-1-2015 - SHR ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ofit was postponed by the assessee which is not permissible. He, therefore, estimated the income of the assessee from the said contract at ₹ 1.29 crores by applying the net profit rate of 8 per cent. to the total expenditure of ₹ 16.22 crores and brought to tax the same in the hands of the assessee for the year under consideration in the assessment originally completed under section 143(3) vide order dated October 12, 2008. 3. Against the order passed by the Assessing Officer under section 143(3), an appeal was preferred by the assessee before the learned Commissioner of Income-tax and after considering the submissions made by the assessee as well as the material available on record, the learned Commissioner of Income-tax, Guntur, deleted the addition made by the Assessing Officer on account of estimated income from the contract of LAPPL holding that no such income could be estimated in respect of the amount received by the assessee towards mobilisation advance. The Assessing Officer accordingly, passed a consequential order on May 10, 2012, giving effect to the appellate order of the learned Commissioner of Income-tax whereby, he deleted the addition of ₹ 1.29 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of TDS for the year under consideration was certainly prejudicial to the interests of the Revenue. He, therefore, set aside the order passed by the Assessing Officer on this issue with a direction to pass the order afresh withdrawing the credit allowed for TDS. Aggrieved by the order of the learned Commissioner of Income-tax passed under section 263, the assessee has preferred the present appeal before the Tribunal. 5. We have heard the arguments of both parties and also perused the relevant material on record. 6. Learned counsel for the assessee has submitted that the issue relating to the grant of TDS made from the mobilisation advance for the relevant year in which such advance is not chargeable to tax, as involved in the present case, is squarely covered in favour of the assessee on merits by the decision of the co-ordinate Bench of this Tribunal in the case of Asst. CIT v. Peddi Srinivasa Rao was directed vide its order dated March 3, 2011, in I. T. A. No. 324/Vizag/2009. He has also placed on record a copy of the said order and perusal of the same shows that similar issue has been decided by the Tribunal in favour of the assessee vide paragraphs 7 to 10 of its order whi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ctive of the year to which it relates. The pre-amended and the amended provisions of section 199 are extracted hereunder : '199. Credit for tax deducted .-(1) Any deduction made in accordance with the foregoing provisions of this Chapter, and paid to the Central 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 unitholder 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 : (3) The Board may, for the purposes of giving credit in respect of tax deducted or tax paid in terms of the provisions of this Chapter, make such rules as may be necessary, including the rules for the purposes of giving credit to a person other than those referred to in sub-section (1) and sub-section (2) and also the assessment year for which such credit may be given. 199. (1) Any deduction made in accorda ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nterest income which was duly received by the Government shall be refunded to the assessee or the assessee is entitled to the credit of the same. The Government cannot benefit itself by taking advantage of legal technicalities. Even otherwise, once the income receipt has been deducted from the cost of machinery to be installed the assessee has indirectly offered the same for assessment and taxation because due to the reduction of cost of the machinery and depreciation on the said machinery would be lesser and the net result of this would be offering the same income otherwise. When a particular income is received by the assessee after deduction of tax at source and the said TDS has been duly deposited with the Government and the assessee has received the requisite certificate to this effect, then on production of the said certificate the assessee becomes entitled for the credit of TDS even if the assessee has not directly offered the said income for tax as the assessee considered the same was not liable to tax. When the assessee has earned interest on deposit mandatory for acquisition and installation of machinery then the interest was earned by the assessee and is directly incident ..... X X X X Extracts X X X X X X X X Extracts X X X X
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