2013 (9) TMI 1294 - AT - Income Tax

Summary

Issues Involved:
The judgment involves the disallowance of TDS claim based on the mismatch between TDS amount claimed and turnover disclosed by the assessee for the assessment year 2006-07.

Details of the Judgment:
The only issue in the appeal was the disallowance of TDS claim amounting to Rs.2,86,134/- due to the discrepancy between the TDS claimed and the gross receipts disclosed by the assessee for the assessment year.

The assessee, a joint venture, initially filed its return of income for the impugned assessment year, showing a total income of Rs.1,38,91,595/-. The Assessing Officer later observed that while the assessee claimed TDS of Rs.58,22,932/- based on the TDS certificate, the entire gross receipts of Rs.25,23,31,091/- mentioned in the TDS certificate were not reflected in the P & L account. The Assessing Officer disallowed a portion of the TDS based on the provisions of u/s 199 of the Act, restricting TDS to the receipts shown by the assessee.

The CIT (A) upheld the disallowance citing Rule 37BA of Income-tax Rules, 1962, which allows for apportionment of TDS to different assessment years on a proportionate basis.

During the appeal, the authorized representative for the assessee argued that the entire TDS amount should be credited without any disallowance, as the balance turnover had already been offered for taxation in preceding years. The representative contended that u/s 199 of the Act is an enabling provision for TDS and not a computation provision, citing relevant case laws.

After considering the submissions, the Tribunal found that the assessee had disclosed a major portion of the turnover for the impugned assessment year and had not claimed TDS for the balance turnover in earlier years. Referring to relevant case laws, the Tribunal held that the disallowance of TDS was unjustified, as the income related to the TDS had already been taxed in previous years. The Tribunal also noted that Rule 37BA was not applicable for the assessment year in question.

Therefore, the Tribunal allowed the appeal, setting aside the order of the CIT (A) and directing the full credit of the TDS amount claimed by the assessee for the impugned assessment year.

The appeal was allowed, and the order was pronounced on 13-9-2013.