TMI Blog2017 (12) TMI 136X X X X Extracts X X X X X X X X Extracts X X X X ..... 1. That the learned Commissioner of Income Tax (Appeals) has erred both in law and on facts in not directing the learned Assessing officer to include the income from contract work declared by the appellant in the return of income furnished by the appellant for the instant assessment year. 2. That the learned commissioner of Income Tax (Appeals) has failed to appreciate that mere fact that allotment of contract does not bring about any liability to taxability the income from contract in the hands of entity executing the contract and on the contrary once a contract has been executed by partnership firm under the deed of partnership then such income has to be assessed in the hands of firm. 3. That the finding that it is a case of sub-contract and whenever there is a sub-contract, the contractor giving the contracts has to once again deduct tax which has not been done by the partner of the firm Sh. Dayanand, when the contract in question have been transferred to the firm and as such the only course of action as per the law is to file the return of income of Sh. Dayanand and claimed the refund is factually incorrect, legally misconceived and untenable. 3. Apart the abo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it did not reflect in the form AS 26 of the firm. The AO in his order after seeking the directions of the Addl. Commissioner of Income Tax under section 144A has disallowed the credit of the TDS deducted in the name of the partner to the firm. The present appeal is against this action of the AO. Besides this the AO in his order has made an addition of ₹ 2,41,563/- as the interest received by the appellant op account of income tax refund, and not disclosed in the return of income which is also the subject matter of this appeal. 5. The ld. CIT(A) confirmed the action of the Assessing Officer. 6. I have considered the rival arguments made by both the sides, perused the orders of the A.O and the ld. CIT(A) and the paper book filed on behalf of the assessee. G round 1 1.2 challenge the denial of credit of TDS of ₹ 13,01,041/- on the income declared and assessed in the hands of the appellant firm on the basis that TDS has not been deducted in the name of the appellant but in the individual capacity of the partner of the appellant. Also, additional grounds have been raised to include the income declared from contract works in the return of income furnished by the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essing Officer by invoking the provisions of Section 40(a)(ia) of the Act. 8. It was submitted by the ld. counsel for the assessee that once the contract is obtained in the name of individual but executed by partnership firm under the deed of partnership then such income has to be assessed in the hands of the firm. In the case of ITO vs. Manikarnika Devi Singh reported in 98 Taxman 32 (Jab)(Mag),(page 115 of paper book) it has been held as under: Once the revenue had itself accepted that the contract work was executed by the firm and the income was earned by the firm, the only question remained whether the firm be assessed as registered firm or unregistered firm. It was not in dispute that the assessee made all the necessary compliance required for getting the registration as per section 185. In K.D. Kamath CO. v. CIT [1971] 82 ITR 680 the Supreme Court held that the fact that the exclusive power and control, by agreement of the parties, is vested in one partner, and the further circumstances that only one partner can operate the bank accounts or borrow on behalf of the firm, is not destructive of the theory of partnership provided two essential conditions are satisfie ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 44/2013 (Bom) CIT v. SMSL-UANRCL (JV) (pages 85-89 of Paper Book) iv) 374 ITR 35 (Del) CIT v. Oriental Structural Engineers (P)Ltd. (pages 90-95 of Paper Book) v) 39 DTR 217 (Del) CIT vs. OrientalStructural Engineers(P) Ltd. (pages 55-57 of Paper Book) vi) 166 TTJ 612 (Hyd.) M/s Hindustan Ratna JV vs.ITO (pages 73-84 of Paper Book) vii) Circular No.7/2016 issued by CBDT (pages 48 SOT 178 (Visakhapatnam) ITO vs. UAN Raju Construction 31 DTR 49 (HP) CIT vs. Ambuja Daria Kashlog Mangu Transport Coop Society viii) 48 DTR 130(HP) CIT vs. Sirmour Truck Operators Union ix) 240 CTR 325 (P H) CIT vs. Grewal Brothers x) 248 ITR 339 (AAR) Van Oord ACZ BV xi) 124 ITR 192 (Bom) CIT vs. British Drug Houses (India)P. Ltd xii) ITA No(s) 1280/PN/2006 (A.Y. 2003-04), 60/PN/2009 (A.Y. 2005-06), 177 and 178/PN/2008 (A.Y. 2002-03 and 2004-05 ITO vs. Rajdeep PMCC Infrastructure, xiii) ITA No. 65/PN/2011 (AY 2007-08) M/s Gammon Progressive-JV 55 DTR 417 (Cal) Panna Lai Kejrilal vs. CIT xiv) 314 ITR 343 (AAR) Hyosung Corporation xv) 210 Taxman 49 (Mad)(Mag) Chennai Port Trust v. ITO 12. Once income is required to be assessed, TDS credit has to be allowed irr ..... X X X X Extracts X X X X X X X X Extracts X X X X
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