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TMI Blog2021 (4) TMI 915X X X X Extracts X X X X X X X X Extracts X X X X ..... only the taxes directly paid by the assessee but also those paid on its behalf. Sub-section (1) of section 199 with the caption `Credit for tax deducted states that Any deduction made in accordance with the foregoing provisions of this Chapter and paid to the Central Government shall be treated as a payment of tax on behalf of the person from whose income the deduction was made . . Thus, it is glaring from section 199 that the tax deducted at source is also a payment of tax on behalf of the assessee in the instant case. The ITSC s direction for giving credit for taxes already paid by the applicant brings into its fold not only the amount of tax paid by the assessee but also the amount of tax deducted at source on behalf of the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ndia at the gross rate of 10%. The AO, while completing the assessment of the parent company, subjected the royalty and technical fees income to tax @ 40%. In order to prevent protracted litigation, the parent company as well as the assessee filed applications before the Income-tax Settlement Commission (ITSC) on 04-12-2014. The assessee s application covered three assessment years, viz., 2012-13, 2013-14 and 2014-15. The assessee had filed returns of income u/s 139 of the Act for the assessment years 2012-13 and 2013-14 before filing the application before the ITSC. However, no such return was filed for the assessment year 2014-15. In the application filed before the ITSC, the assessee made disclosure of total income of ₹ 16.80 la ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion 240 of the Act, the relevant part of which reads as under: Where, as a result of any order passed in appeal or other proceeding under this Act , refund of any amount becomes due to the assessee, the Assessing Officer shall, except as otherwise provided in this Act, refund the amount to the assessee without his having to make any claim in that behalf. 4. On going through the mandate of the above extracted provision, it becomes unequivocal that where a refund becomes due to the assessee, the AO is obliged to issue refund without requiring the assessee to file any claim. The two situations covered in this provision requiring the suo motu grant of refund are, first, where any order is passed in appeal and second, where any order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orically observed in its order dated 24-05-2016 that the assessee did not file any return of income for the assessment year 2014-15 before filing the application. 6. Section 245C, dealing with application for settlement of cases, clearly provides through sub-section (1) that : An assessee may, at any stage of a case relating to him, make an application in such form and in such manner as may be prescribed, . to the Settlement Commission to have the case settled and any such application shall be disposed of in the manner hereinafter provided. This provision embodies that the assessee can make an application in the prescribed form `any stage of a case relating to him. One interpretation of the expression `at any stage of a case can ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... C has been interpreted by the AO as for granting adjustment only of the taxes paid by the assessee and not the TDS. The direction is reproduced hereunder: Since the details of tax payments are available only with the AO, the AO shall compute the tax payable including surcharge and interest, if any, after giving credit for taxes already paid by the applicant and issue demand notice u/s.245D(6) of the Income-tax Act. 8. A careful perusal of the direction explicitly indicates that the AO shall compute the tax payable after giving credit for taxes already paid by the applicant . `Taxes already paid do not mean only the taxes directly paid by the assessee but also those paid on its behalf. Sub-section (1) of section 199 with the capt ..... X X X X Extracts X X X X X X X X Extracts X X X X
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