TMI Blog2008 (2) TMI 910X X X X Extracts X X X X X X X X Extracts X X X X ..... ₹ 42,97,006/- Less : MAT Credit set off ₹ 12,78,561/- ₹ 8875,544/- ₹ 1,01,54,105/- Refund due ₹ 58,57,099/- It appears that when the return was processed under section 143(1) of the Income-tax Act, the Assessing Officer calculated the refund at a lesser figure of ₹ 44,47,478/-. The difference arose because while calculating the refund the Assessing Officer did not set off the MAT credit from the tax payable and proceeded to deduct only the TDS from the tax payable. This mistake was pointed out by the assessee by an applicat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nance Act, 1997, with effect from 1.4.1997 provides for tax credit in respect of tax paid on deemed income relating to certain companies. It first declares that the tax paid by the assessee under section U5JA (1) on the amount of book profit shall be given credit in accordance with the provisions of the Act. Sub-section (2) says that the amount of tax credit to be allowed shall be the difference of the tax paid under section 115JA (1) and the amount of tax payable on the total income of the assessee computed in accordance with the other provisions of the Act. Subsection (4) declares that the tax credit computed as above shall be allowed set off in a year when tax becomes payable on the total income computed in accordance with the normal pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... redit has to be given first against the tax payable before charging interest under sections 234B and 234C. Though this was the main dispute in that case, the Tribunal has taken note of the issue in a broad-base manner and has opined that the method of prescribing the order of priority of adjustment between TDS, advance tax and MAT credit as given in the Schedule-G of Form No. 1, which is the return form prescribed by the Board for companies, is contrary to the intention of the legislature and is even in excess of the delegated authority. It may be mentioned that in the return of income, the priority of adjustment given is that interest under sections 234B and 234C shall be first deducted and only thereafter the lax credit under section 115J ..... X X X X Extracts X X X X X X X X Extracts X X X X
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