TMI Blog2015 (9) TMI 435X X X X Extracts X X X X X X X X Extracts X X X X ..... r The Respondent : Shri Anuj Kisnadwala ORDER PER BENCH: The Revenue has filed this appeal challenging the order dated 14.7.2014 passed by the ld.CIT(A)-3, Mumbai and it relates to the assessment year 2011-12. 2. The solitary issue urged in this appeal is whether the ld.CIT(A) was justified in directing the AO to allow the credit of TDS of ₹ 13,76,800/- to the assessee company. 3. The facts relating to the dispute are stated in brief. The assessee is a subsidiary company of another company named as M/s DIGI Cable Network Private Limited. The assessee is engaged in the business of cable television distribution and other related services. The assessee company has made payment towards broad casters pay channel charges for providing cable services for the Analog area and CAS areas. The payments made for CAS Division were reimbursed by the holding company, cited above, to the assessee herein. At the time of reimbursement, the holding company has deducted Tax at source from the amount so reimbursed @ 2%. 4. Since the assessee company claimed that it has made payment pay channel charges for CAS areas only as representative of its holding company, it accoun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 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 Rule 37BA Credit for tax deducted at source for the purposes of section 199. (1) Credit for tax 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 authorised by such authority. (2) (i) Where under any provisions of the Act, the whole or any part of the income on which t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 that the income had not been disclosed in the return filed by the assessee for the assessment year. The assessee may as per relevant provisions of Income-tax Act, consider the income either as not taxable in his hands or as being relatable to a different assessment year and he may even claim set off of loss or other deductions against such income. ..It would be, therefore, improper and even impermissible for the revenue to swallow the amount of TDS after having received and enjoyed the same. It cannot be ignored that every item of TDS carries with it an obligation of trust and accountability to return the amount and/or give credit for the amount so deducted depending upon the tax liability of the recipient to be determined in the course of his assessment. .. Being a case of direct tax, there is also no que ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Ld A.R, besides supporting the order passed by Ld CIT(A), also placed reliance on the decision rendered by the Mumbai bench of Tribunal in the case of Arvind Murjani Brands (P) Ltd Vs. ITO (2012)(137 ITD 173), wherein the Tribunal held as under:- The position is, therefore, crystal clear that the amount of tax deducted at source has to be necessarily allowed credit somewhere. It cannot be a case that the amount of such tax deducted and paid to the exchequer is not to be refunded, if the tax due on the amount of income received is either lower than the amount of tax deducted or there does not exist any liability to tax in respect of the amount received. We may fruitfully refer to Article 265 of the Constitution of India, which provides that : No tax shall be levied or collected except by authority of law . From the above discussion it follows that the amount of tax deducted at source needs to be adjusted against some tax liability of the payee and in case there is no such liability, it has to be refunded to payee because of the very mandate of section 199 as per which such amount is treated as payment of tax on behalf of the person from whose income the deduction was made, t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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