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TMI Blog2020 (2) TMI 21X X X X Extracts X X X X X X X X Extracts X X X X ..... city 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 . - ITA No. 5562/Mum/2018 - - - Dated:- 8-1-2020 - Shri S. Rifaur Rahman, Accountan Member And Shri Ravish Sood, Judicial Member For the Appellant : Shri M.M. Golvala And Ms. Urja Mehta, ARs For the Respondent : Shri V. Vinod Kumar, Sr.DR ORDER PER RAVISH SOOD, JM The present appeal filed by the assessee is directed against the order passed by the CIT(A)-10, Mumbai, dated 28.06.2018, which in turn arises from the intimation issued by the Assessing Officer (in short, the A.O ) under Sec. 143(1) of the Income Tax Act, 1961 (for short, Act ), dated 31/01/2017. The assessee has assailed the impugned intimation on the following effective grounds of appeal before us :- 1. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the subsequent financial year i.e F.Y. 2015-16. It was submitted by the ld. A.R that because the amount of TDS credit of ₹ 45,41,995/- formed part of the TDS return of M/s. BG Exploration Production India Ltd. for the subsequent year, therefore, the same stood reflected in the Form 26AS of the assessee for the said year i.e A.Y. 2016-17. However, the aforesaid explanation of the assessee did not find favour with the CIT(A). It was observed by the CIT(A) that as per the post amended provisions of section 199 r.w.r 37BA, the credit for the amount of tax deducted at source (TDS) and paid to the Central Government was to be given to the assessee in the year of deduction. Accordingly, finding no infirmity in the declining of the TDS credit by the A.O, the CIT(A) dismissed the aforesaid claim of the assessee. 4. Being aggrieved with the impugned order of the CIT(A), the assessee has carried the matter in appeal before us. As is discernible from the records, the A.O had given a short credit of TDS of ₹ 45,41,995/- while processing the return of income of the assessee under Sec. 143(1) of the Act. As claimed, the short/deficit TDS credit had emerged in respect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion (1) and sub-section (2) and also the assessment year for which credit may be given. (Emphasis supplied by us) . In our considered view, the aforesaid statutory provision contemplates that the Board may, for the purpose of giving credit in respect of tax deducted or tax paid in terms of the provisions of Chapter VII of the Act, make such rules as may be necessary, including the rules for the purposes of giving credit to a person other than those referred to in sub-section (1) and subsection (2) and also the assessment year for which such credit may be given. On a perusal of the relevant Rule 37BA, we find, that the same reads as under : Credit for tax deducted at source for the purposes of section 199. (1) Credit for tax deducted at source and paid to the Central Government in accordance with the provisions of Chapter XVII, shall be given to the person to whom payment has been made or credit has been given (hereinafter referred to as deductee) on the basis of information relating to deduction of tax furnished by the deductor to the income-tax authority or the person authorised by such authority. (2) (i) where under any provisions of the Act, the whole ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t of providing that where tax has been deducted at source and paid to the Central Government and the income is assessable over a number of years, credit for tax deducted at source shall be allowed across those years in the same proportion in which the income is assessable to tax. Accordingly, the legislative intent of emphasizing an inextricable nexus between the credit for tax deducted at source (TDS) and the correlating assessable income, can safely be gathered beyond any doubt. In fact, we hold a strong conviction, that the credit for tax deducted at source (TDS) and the corresponding assessable income is so much inextricably interlinked or rather interwoven, that in case they are divorced and considered on a standalone basis in separate years, then the same would result to a distorted tax/interest liability of the assessee under the Act. As such, we are unable to comprehend as to on what basis the aforesaid claim of the assessee for credit of TDS of ₹ 45,41,995/-, which as claimed by the assessee pertains to its duly accounted for sales/receipts for the year under consideration i.e. A.Y 2015-16, had been declined by the lower authorities. Our aforesaid view that as per se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to whom payment has been made or credit has been given (hereinafter referred to as deductee) on the basis of information relating to deduction of tax furnished by deductor to the income-tax authority or the person authorised by such authority. (2) (i) where under any provisions of the Act, the whole or any part of the income on which tax has been deducted at source is assessable in the hands of a person other than the deductee, credit for the whole or any part of the tax deducted at source, as the case may be, shall be given to the other person and not to the deductee: Provided that the deductee files a declaration with the deductor and the deductor reports the tax deduction in the name of the other person in the information relating to deduction of tax referred to in sub-rule (1). (ii) The declaration filed by the deductee under clause (i) shall contain the name, address, permanent account number of the person to whom credit is to be given, payment or credit in relation to which credit is to be given and reasons for giving credit to such person. (iii) The deductor shall issue the certificate for deduction of tax at source in the name of the person in whose nam ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nefit of TDS is to be given for the assessment year for which the corresponding income is assessable. Since the income of ₹ 84.10 lakh, on which tax of ₹ 8,41,050/- was deducted at source, is patently assessable in the year under consideration, we hold that the benefit of the TDS should also be allowed in the same year, namely, the year under consideration. We, therefore, overturn the impugned order and direct accordingly. 7. On the basis of our aforesaid deliberations, we are unable to subscribe to the view taken by the lower authorities that despite the fact that the sales/receipts were accounted for by the assessee during the year under consideration viz. A.Y 2015-16, the corresponding credit of TDS of ₹ 45,41,995/- was not be allowed to it in the said year. In fact, we are unable to persuade ourselves to subscribe to the view taken by the lower authorities, that the credit 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/defic ..... X X X X Extracts X X X X X X X X Extracts X X X X
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