TMI Blog2023 (2) TMI 261X X X X Extracts X X X X X X X X Extracts X X X X ..... e is not dependent upon its subsequent deposit by the deductor. Once there is deduction of tax at source, the benefit of such tax deduction has to be allowed in the hands of deductee u/s 143(1) of the Act irrespective of its subsequent deposit or non-deposit by the deductor. Our view is fortified by section 234B dealing with interest for default in payment of advance tax. This section provides that where an assessee fails to pay due advance tax etc., he shall be liable to pay simple interest at the specified rate on the amount of `assessed tax - if there is an income on which tax is deductible at source, then such income will be reduced for determining the advance tax liability and the consequential interest liability u/s 234B of the Ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l by the assessee is directed against the order dated 09-12-2021 passed by the ld. CIT(A) in National Faceless Appeal Centre, Delhi u/s.250 of the Income-tax Act, 1961 (hereinafter also called the Act ) in relation to the assessment year 2019-20. 2. The only issue raised herein is against not allowing credit u/s 143(1) of the Act for tax deducted at source by the employer amounting to Rs.8,21,149/- (which amount has swelled to Rs.11,39,290/- with interest) that was not deposited with the exchequer. 3. Briefly stated, the facts of the case are that the assessee has been an employee of M/s. Earth Water Limited (in short EWL ) working as Chief Operating Officer. Return was furnished declaring total income under the head Salaries at R ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent to mention that though the assessee continued to remain in the employment of EWL for whole of the year but salary from October, 2018 was not paid. The ld. AR submitted that insolvency proceedings against the employer company are in progress and till date no salary for the period October, 2018 onwards has been paid. The moot question is about allowing or otherwise of credit for tax deducted at source from the salary income, which was not deposited by the employer due to its own precarious financial condition. Admittedly, the amount of tax deducted at source to the tune of Rs.8,21,149/- has not gone to the coffers of the Revenue. At the same time, it is equally true that such amount of tax was deducted at source from salary of the assesse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... interest and fee, if any, shall be computed on the basis of the total income computed under clause (a). Clause (c), which is material for our purpose, runs as under : `(c) the sum payable by, or the amount of refund due to, the assessee shall be determined after adjustment of the tax, interest and fee, if any, computed under clause (b) by any tax deducted at source, any tax collected at source, any advance tax paid, any relief allowable under section 89, any relief allowable under an agreement under section 90 or section 90A, or any relief allowable under section 91, any rebate allowable under Part A of Chapter VIII, any tax paid on self-assessment and any amount paid otherwise by way of tax, interest or fee; 7. On going through s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of advance tax. This section provides that where an assessee fails to pay due advance tax etc., he shall be liable to pay simple interest at the specified rate on the amount of `assessed tax . The term assessed tax has been defined in Explanation 1 to mean the tax on total income determined u/s.143(1) or regular assessment as reduced by the amount of: `(i) any tax deducted or collected at source in accordance with the provisions of Chapter XVII on any income which is subject to such deduction or collection and which is taken into account in computing such total income . Since section 234B has reference to advance tax. Computation of advance tax has been dealt with in section 209 of the Act. There are four clauses, (a) to (d) of section 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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