TMI Blog2022 (1) TMI 289X X X X Extracts X X X X X X X X Extracts X X X X ..... 11. One TDS certificate, available falls in this category. In this TDS certificate, date of credit or payment is not mentioned and only date of deposit of TDS in Government Account is mentioned as on 05/03/2010 and 05/04/2010 respectively. In the circumstances, it needs verification as to in which year the corresponding income was assessable in the hands of the assessee. Second category of TDS certificates are concerned, we find that in those certificates income has been credited or paid to the assessee in the assessment year under consideration and tax has also been deducted in assessment year under consideration i.e. AY 2011-12 , however same has been deposited in subsequent assessment year i.e. AY 2012-13. If the income corresponding to the TDS is assessable in the year under consideration, then the assessee is eligible for credit of TDS in the year under consideration, irrespective of the year in which TDS was deposited by the deductor - section 205 of the Act also support this view. According to the section 205 of the Act, where tax is deductible at the source under the provisions of the act, the assessee shall not be called upon to pay tax himself to the extent to which t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... - - - Dated:- 5-1-2022 - Shri Om Prakash Kant, Accountant Member And Shri Amarjit Singh, Judicial Member For the Assessee : Shri Akram Khan (AR) For the Revenue : Shri B K Bagchi (DR) ORDER PER OM PRAKASH KANT, AM This appeal by the assessee is directed against order dated 28/06/2019 passed by the Ld. Commissioner of Income Tax (Appeals)-14, Mumbai [in short the Ld. CIT(A)] for assessment year 2011-12 raising following grounds: 1. The Commissioner of Income-tax (Appeals) erred in holding that the Appellant was not entitled to TDS credit aggregating to ₹ 2,55,60,477/- in the Assessment Year 2011-12. 2. The Commissioner of Income-tax (Appeals) erred in directing the Assessing Officer to withdraw TDS Credit of ₹ 46,44,433/- 2. Briefly stated facts of the case are that: (i) In the scrutiny assessment order under section 143(3) of the Income-tax Act, 1961 (in short the Act‟), the Assessing Officer allowed credit of tax deducted at source (TDS) amounting to ₹ 13,37,98,519/-. According to the assessee, it was allowed short credit of TDS. On further appeal, the Ld. First Appellate Authority i.e. Ld. CIT(A) directed the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ting that the said TDS credit has been claimed in accordance with section 199 of the Income Tax Act, 1961, r.w.s. 37BA(3)(i) of the Income-tax Rules, 1962 and they have not claimed the TDS credit in any other assessment years (page no. 113 to 115 of the compilation). 8) The Appellant has also submitted before the Assessing Officer that they have not claimed the credit of tax deducted at source while filing the Return of Income for AY 2012-13. In view of the above, the Appellant submits that the Assessing Officer be directed to grant further credit of TDS to the extent of ₹ 2,19,04,771/- (TDS credit claimed in the Return of income ₹ 17,39,68,882/- less TDS credit granted vide order giving effect to the CIT(A) ₹ 15,20,64,111/- 4. The Ld. CIT(A) directed the Assessing Officer to allow credit as per the form No. 26AS for the year under consideration and withdraw the excess credit (credit of ₹ 52,48,263/- which had already been claimed by the assessee and allowed by the Ld. Assessing Officer in preceding years) allowed to the assessee. Relevant finding of the Ld. CIT(A) is reproduced as under: I have considered the submission made by the appel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt of ₹ 3,79,119/= is concerned, the appellant is entitled to credit for the same after verification of the correctness of the claim of the appellant in this regard. 4. Regarding the credit for balance amount of ₹ 1,97,663/-, the appellant has not been given any proof, therefore, credit for the same cannot be given to the appellant. Total of above mentioned amounts comes to ₹ 2,65,60,477 /-, however, the AO has already given credit for amount of ₹ 46,44,433/- to the appellant and only TDS credit to the extent of ₹ 2,19,04,771/- is remaining. The AO should verify as to how excess credit has been given to the appellant and withdraw the credit which has been wrongly granted to the appellant. 5. Before us, the assessee has challenged the finding of the Ld. CIT(A) of holding the assessee as not entitled for TDS credit aggregating ₹ 2,55,60,477/- in the impugned assessment year and also the direction of the Ld. CIT(A) of withdrawing TDS credit of ₹ 46,44,433/-. 6. We have heard rival submission of the parties on the issue in dispute and perused the relevant material on record. The issue in dispute involving ground No. 1 (one) of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... overnment shall be given for the assessment year for which such income is assessable. In case the income is assessable over a number of years, credit for tax deducted at source shall be allowed across the years in the same proportionate, in which the income is assessable to tax. 7.2 For ready reference, the relevant provision for credit of tax deducted at source during relevant period i.e. section 199 of the Act, is reproduced as under: (1) Any deduction made in accordance with the foregoing provisions of this Chapter and paid to the Central Government shall be treated as payment of tax on behalf of the person from whose income the deduction was made, or of the owner of the security, or o the depositor or of the owner of property 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 purpose 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 ne ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ll be granted on the basis of (i) the information relating to deduction of tax furnished by the deductor to the income-tax authority or the person authorized by such authority: and (ii) the information in the return of income in respect of the claim for the credit subject to verification in accordance with the risk management strategy formulated by the Board from time to time. 9. The assessee has relied on the decision of the Pune Bench of Tribunal in the case of M/s Mahesh Software Systems P. Ltd. in ITA No. 1288/PUN/2017 for assessment year 2011-12. In the said case the assessee raised bills of ₹ 84,10,000/- on M/s Ashoka Leyland on 28/03/2011 and recorded this invoice in assessment year 2011-12, whereas M/s Ashok Leyland though deducted the tax at source on the said bill, however deposited it with the exchequer in the month of April 2011. The Tribunal (supra) after analyzing section 199 and Rule 37BA concluded as under: 7. The AO has relied on sub-rule (1) of section 37BA for denying the benefit of TDS during the year under consideration. This part of the Rule provides that the credit for TDS shall be given to the person to whom payment has been mad ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... redit for the tax deducted at source (TDS) was to be allowed to the assessee in the immediately succeeding year i.e A.Y 2016-17, despite the absence of the assessable income in the said year. Accordingly, we restore the matter to the file of the A.O, with a direction to allow the short/deficit credit of TDS of ₹ 45,41,995/- to the assessee in the year under consideration i.e A.Y 2015-16. Before parting, we may herein observe, that the A.O before allowing the credit of the TDS of ₹ 45,41,995/- shall verify the veracity of the claim of the assessee that the sales/receipts corresponding to the TDS credit of ₹ 45,41,995/- were accounted for by it during the year under consideration viz. A.Y. 2015- 16. Also, as a word of caution, the A.O shall take necessary steps in order to ensure that no TDS credit of the aforesaid amount of ₹ 45,41,995/- is/was availed by the assessee in the immediately succeeding year i.e A.Y 2016-17 in which the same is reflected in its Form 26AS . 12. In view of above precedents, we summarise the position of law on the issue that during relevant period Credit for TDS has to be allowed in the assessment year, in which the corresponding ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... here tax is deductible at the source under the provisions of the act, the assessee shall not be called upon to pay tax himself to the extent to which tax has been deducted from that income. Thus, in order to call bar of section 205 into operation, it is necessary to establish the tax has in fact deducted at source and credit of the tax deducted at source must be granted to the payee, even if the payer or deductor has not deposited the tax into Government Account. 15. The third category of TDS certificates, where income has been credited or paid by the deductor in financial year corresponding to assessment year 2012- 13 and tax has also been deducted in the financial year corresponding to assessment year 2012-13. In those cases, the deductor has credited the income to the assessee for assessment year 2012-13, whereas assessee has claiming the credit of said TDS in assessment year 2011-12. We do not understand as how and on what basis the assessee has credited the income corresponding to those TDS certificate in the year under consideration. No documentary evidence in this regard as the corresponding income is assessable or capable of being assessed in the year under consideration ..... X X X X Extracts X X X X X X X X Extracts X X X X
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