TMI Blog2022 (12) TMI 74X X X X Extracts X X X X X X X X Extracts X X X X ..... by following cash basis of accounting, even though the client/deductor had deducted tax in earlier years by following an accrual basis of accounting. ITAT Chennai Bench in the case of Supreme Renewable Energy Ltd. [ 2008 (8) TMI 432 - ITAT MADRAS-C] held that when a particular income is received by assessee after deduction of tax at source and said TDS has been duly deposited with the Government and the assessee has received requisite certificate to this effect, then on production of the said certificate the assessee becomes entitled to credit of TDS, even if the assessee has not directly offered said income for tax as the assessee considers that same is not liable for tax. We are of the considered view that the assessee is eligi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... en and the Income tax Department is required to adjust the mismatch in the interest of justice otherwise it will turn out to be not a case of proper taxation but a case of downright misappropriation. 3. The CIT(A) ought to have allowed the appeal of the Appellant. 4. The appellant craves leave to add, amend or alter the aforesaid grounds of appeal at the time of hearing if the need arise Total tax effect Rs. 2,50,100/- 3. The brief facts of the case are that the assessee who was a practising advocate, filed its return of income for assessment year 2016-17 showing total income of _ 1,08,85,460/- and claimed TDS credit of _ 12,05,147/- in respect of professional fees received during the year. The assessee has been consiste ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... employed by the assessee, though the expenditure has been booked by the deductors in assessment year 2015-16, but the related payment has not been shown as a receipt/turnover by the assessee in his return of income for assessment year 2015-16 as the amount has not been received till 31-03-2015. 4. All the above facts were explained before Ld. CIT(Appeals), however, he dismissed the assessee s appeal on the ground that credit for the same should have been claimed by the assessee in assessment year 2015-16 itself i.e. in the year when the payer/deductors had deducted tax on the same as per their method of accounting. While dismissing the appeal of the assessee, Ld. CIT(Appeals) made the following observations: The TDS credit and the c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .................................. Therefore, while adjudicating ground no.1 of this appeal, I direct the AO to give TDS credit in A.Y.2016-17 for the deductions made in F.Y. 2015-16 by ensuring that the total commensurate amount is brought to tax in A.Y.2016-17 itself. It is my conscious decision not to accede to the demand of appellant for allowing TDS credit pertaining to A.Y. 2015-16. The ground no.1 is accordingly disposed off with the direction to AO to issue revised demand notice. The ground no.1 is dismissed. 5. The limited point for consideration before us is whether in the instant set of facts, the assessee is eligible to claim credit of TDS in assessment year 2016-17, when the assessee offers this income on receipt of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by assessee after deduction of tax at source and said TDS has been duly deposited with the Government and the assessee has received requisite certificate to this effect, then on production of the said certificate the assessee becomes entitled to credit of TDS, even if the assessee has not directly offered said income for tax as the assessee considers that same is not liable for tax. 6. In view of the consistent position on this issue by various Courts, we are of the considered view that the assessee is eligible to claim credit for TDS in assessment year 2016-17, when such professional income has been offered to tax by the assessee on receipt basis, since the assessee has been consistently following cash basis of accounting since ince ..... X X X X Extracts X X X X X X X X Extracts X X X X
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