9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2023 (4) TMI 61 - AT - Income TaxDenial of credit of TDS - whether the assessee is liable for deposit/payment of the TDS already deducted by the vendee but not deposited or be given credit of the same? - HELD THAT - Revenue cannot deny the TDS credit to the assessee and the only option left for the Revenue is to proceed against the deductor by holding him to be an assessee-in-default. We therefore set aside the order of the CIT (A)-NFAC and direct the CPC to give due credit to the assessee. The grounds raised by the assessee are accordingly allowed.
Issues Involved:
1. Credit of TDS amount of Rs.10,11,000/- not given by CPC. 2. Whether the assessee should be given credit for TDS deducted but not deposited by the vendee. Summary: Issue 1: Credit of TDS amount of Rs.10,11,000/- not given by CPC The assessee, an individual, filed his return of income for the A.Y. 2019-20 declaring total income of Rs.1,57,94,132/- and claimed a refund of Rs.1,20,510/-. The CPC Bengaluru, in the intimation u/s 143(1), did not give credit of Rs.10,11,000/- being the TDS u/s 194IA of the Act by Mr. Pradeep Ramrakhyani. The CIT (A)-NFAC upheld the action of the CPC, stating that the assessee failed to provide documentary evidence that the vendee had deducted the TDS amount. The CIT (A)-NFAC noted that no credit of TDS can be allowed if the same is not appearing on the Income Tax Portal and confirmed the action of the AO CPC. Issue 2: Whether the assessee should be given credit for TDS deducted but not deposited by the vendeeThe learned Counsel for the assessee argued that the vendee, Mr. Pradeep Ramrakhyani, had deducted TDS of Rs.10,11,000/- while purchasing the property but did not deposit the same into the Central Government account. The Counsel cited several decisions including Yashpal Sahni vs. Rekha Hajarnavis (2007) 165 Taxman 144 (293 ITR 539)(Bom) and Smt. Anusuya Alva v. Dy. CIT (2005) 278 ITR 206 (Kar.), arguing that the assessee should not suffer for the vendee's failure to deposit the TDS and should be given due credit. The Tribunal, after considering the arguments and various decisions, found merit in the assessee's arguments. It noted that under section 205 of the Act, the assessee cannot be held liable for payment of tax which was deducted at source by the deductor. The Tribunal cited the Delhi Bench of the Tribunal in Aricent Technologies Holdings Ltd vs. Addl. CIT in ITA 5708/Del/2019, which held that credit for TDS should be allowed to the deductee even if the deductor fails to deposit the tax with the Central Government. The Tribunal also referred to the Hon'ble Karnataka High Court in Smt. Anusuya Alva vs. Dy. CIT (2005) 278 ITR 206 (Kar.), which held that the Revenue cannot recover the TDS amount from the assessee if the deductor fails to deposit the same. The Tribunal concluded that the Revenue cannot deny the TDS credit to the assessee and the only option left for the Revenue is to proceed against the deductor by holding him to be an assessee-in-default. Therefore, the Tribunal set aside the order of the CIT (A)-NFAC and directed the CPC to give due credit of Rs.10,11,000/- to the assessee. The appeal filed by the assessee was allowed. Order pronounced in the Open Court on 31st March, 2023.
|
