GST Helpdesk   Subscription   Demo   New User   Login      
Tax Management India .com
TMI - Tax Management India. Com
Extracts
Home List
← Previous Next →

2015 (9) TMI 64 - ITAT DELHI

2015 (9) TMI 64 - ITAT DELHI - TMI - Credit of tax deducted at source u/s 199 denied - Held that:- TDS Certificate has been issued to the assessee only and as per data base of Income-tax department, the TDS is reflecting against the assessee only, therefore allowing credit in the hands of Shri Kapil Ahluwalia was not possible. Neither party should be made unjust enriched at the cost of the other. We hold that the credit of the ₹ 12,23,608/- is allowable in the hands of the assessee, in vie .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

Kant, JJ. For The Appellant : Sh. K.C.Singhal, Adv. For The Respondent : Sh. Sujit Kumar, SR. DR ORDER PER O.P.KANT, A.M. This appeal has been preferred by the assessee against the order dated 11th May, 2012 of the Commissioner of Income Tax (Appeals)- XXVII, New Delhi for assessment year 2009-10. 2. The grounds of appeal raised by the assessee are as under :- 1. The ld. CIT(A) erred, on facts and in law, in not granting credit of tax deducted at source u/s 199 of the I. T. Act, 1961. 2. Without .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

9.2009 declaring total income of ₹ 1,19,89,080/-. The scrutiny assessment of the case was completed on 23rd December, 2011 u/s 143(3) of the Income Tax, 1961 (in short Act ). 4. During the year under consideration, the assessee received commission of ₹ 2,61,18,048/- from M/s. Arvind mill. However, in P&L a/c, the assessee credited only ₹ 1,53,18,478/- as her income. Pursuant to the query raised by the Assessing Officer, it was explained by the assessee that the balance amou .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ficer accepted this treatment of income by the assessee, however, referring to the provisions of Section 199 of the Act, allowed TDS credit of ₹ 17,35,607/-, in proportion to the receipt from commission credited in P&L Account and the credit for the balance amount of TDS of ₹ 12,23,608/- was denied in the hands of the assessee, concurrently holding that amount of commission income given to Sh. Kapil Ahluwalia was never an income of the assessee. 5. Aggrieved, the assessee filed a .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ssessee, was also not accepted by the CIT(Appeals). In para 12 of his order, the CIT(Appeals) has held that the assessee has not fulfilled the conditions provided in clause 2 of Rule 37 BA of Income -tax Rules (in short Rules ) nor any declaration was filed by the appellant with the deductor giving him prescribed details of Sh. Kapil Ahluwalia and therefore he declined to issue any direction as requested by the assessee. Aggrieved the assessee is before us. 6. The ld. Authorised Representative ( .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ion 199 of the Act and Rules made thereunder are enabling provisions only and the AO has no power to disallow the credit which is available to the deductee on the basis of the TDS certificates. Further, he also submitted that the provisions of section 199 of the Act and rules made thereunder cannot be interpreted in such a manner so as to permit the Income Tax Department to retain the amount of TDS as such course of action would be in violation of the provisions of Article 265 of the Constitutio .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

nai 4. Lucent Technologies GRL LLC vs. DDIT 45 SOT 311 Mum 7. On the other hand, ld Department Representative (DR), relying on the lower authorities, submitted that assesses is not having any case as the Assessing Officer and the CIT(Appeals) has rightly restricted the credit of TDS in proportionate to the amount of the receipt declared by the assessee in its Profit and Loss Account. 8. We have heard the rival submissions and arguments advanced by both the parties. The assessing officer has deni .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

or of the unit-holder, or of the shareholder, as the case may be. (2) Any sum referred to in sub-section (1A) of section 192 and paid to the Central Government shall be treated as the tax paid on behalf of the person in respect of whose income such payment of tax has been made. (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 rules53 as may be necessary, including the rules for the purposes of giving .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ax deducted at source and paid to the Central Government in accordance with the provisions of Chapter XVII, shall be given to the person to whom payment has been made or credit has been given (hereinafter referred to as deductee) on the basis of information relating to deduction of tax furnished by the deductor to the income-tax authority or the person authorized by such authority. (2) (i) If the income on which tax has been deducted at source is assessable in the hands of a person other than th .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

a deductee, being a partner of a firm or a karta of a Hindu undivided family, is assessable as the income of the firm, or Hindu undivided family, as the case may be; (d) the income from a property, deposit, security, unit or share held in the name of a deductee is owned jointly by the deductee and other persons and the income is assessable in their hands in the same proportion as their ownership of the asset : Provided that the deductee files a declaration with the deductor and the deductor rep .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

erson in whose name credit is shown in the information relating to deduction of tax referred to in sub-rule (1) and shall keep the declaration in his safe custody. (3) (i) Credit for tax deducted at source and paid to the Central Government, shall be given for the assessment year for which such income is assessable. (ii) Where tax has been deducted at source and paid to the Central Government and the income is assessable over a number of years, credit for tax deducted at source shall be allowed .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ement strategy formulated by the Board from time to time. 10. On plain reading of section 199 of the Act and rules mades thereunder, it is apparent that sub section 2 and 3 of the section are not applicable to the facts of the case in hand. Further, sub Rule (2) and (3) of Rule 37BA of the Income-tax Rules are also not applicable to the facts of the case in hand, as the income of the assessee is not falling under any of the clauses of sub Rule (2) and issue of credit in multiple years is also no .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

retation of sub section (1) of section 199 leads to result that the credit of the tax deducted has to be given in the hands of the deductee i. E. the person from whose income the deduction was made. Thus, said sub section nowhere says that credit of TDS should be restricted only to the amount of income or receipt offered in the return of Income or in the Profit and Loss Account. Further, sub rule (1) of rule 37BA of the Rules also emphasize to allow the credit in the hands of deductor on the bas .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

the assessee the information as to the income and the tax deducted was available in the ITS. The Assessing Officer, has accepted the diversion of income in the hand of Shri Kapil Ahluwalia but denied the credit of the total tax deducted by the deductor. We find that the action of the assessing officer was on the basis of the incorrect interpretation of the sub section (1) of section 199 of the Act. The Income-tax Appellate Tribunal, Mumbai Bench A in the case of Arvind Murjani Brands (P) Ltd. vs .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

td. vs. DCIT (Supra) the Tribunal has held as under :- As per our considered view, credit for TDS must in every case be given to the assessee from whose income tax was deducted at source and paid to the credit of the Central Government. If the recipient of the income considers that he is not liable to tax in respect of the income, wholly or partly, therefore, does not disclose the amount of such income in his return, the Income-tax Department cannot refuse to give credit merely by contending tha .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

swallow the rightful money of the tax payer without any rule of law. Further, the departmental representative submitted that there is possibility that Shri Kapil Ahluwalia might have taken credit of the balance ₹ 12, 23,608/- and therefore if credit of this amount is allowed to the assessee, it will amount to allowing of double credit of the same account and it will be unjust enrichment in the hands of assessee. The ld. AR however, countered the argument of the DR and stated that the TDS C .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

 

 

 

 

 



|| Home || Acts and Rules || Notifications || Circulars || Schedules || Tariff || Forms || Case Laws || Manuals ||

|| About us || Contact us || Disclaimer || Terms of Use || Privacy Policy || TMI Database || Members || Site Map ||

© Taxmanagementindia.com [A unit of MS Knowledge Processing Pvt. Ltd.] All rights reserved.

Go to Mobile Version