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TMI Blog2022 (4) TMI 109X X X X Extracts X X X X X X X X Extracts X X X X ..... peal no. Del/CIT(A)-5/0286/17-18 for the assessment year 2015-16 passed by the Commissioner of Income Tax (Appeals)-5 (hereinafter referred as the Ld. FAA in appeal against order dated 30.12.2017 passed by ITO, Ward no. 14(3) Delhi (hereinafter referred to as the Ld. AO) u/s 143(3) of the Income Tax Act, 1961 (hereinafter referred to as the Act ). 2. At the outset, arguments were heard in regard to delay of 337 days in filing of present appeal and counsel for appellant submitted that appellant is a subsidiary of foreign company and as Indian subsidiary it did not have any business since 2014. Therefore, the parent company had taken a decision to wind up the appellant company. The order of Ld. CIT(A) was received by the appellant in September, 2019 and thereafter it was taken up at appropriate managerial for possible examination and consequences. However, due to Covid 19 Pandemic the decision got delayed. He relied judgment of Hon ble Supreme Court of India in Collector Land Acquisition vs. Mst. Katiji 1997 taxman.com 1072 (SC) to contend that for substantial justice technical considerations cannot be sustained and party should be given all reasonable opportunities to contest on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee. 4. In appeal the Ld. F.A.A. had considered the challenge of the addition and held in para no. 7.2 and para no. 7.3 of the its order as under : 7.2 On going through the above details, it is clear that the appellant has shown this amount as revenue in the earlier years. However, AO is directed to verify the same from the profit loss account of earlier years and after being satisfied with the veracity that this has been duly disclosed as revenue, the same is to be allowed. Further, it is observed that as per revenue shown in the profit loss account, ₹ 4,47,11,666/- has been mentioned for the total cumulative receipts, however, as per Form 26AS, ₹ 4,47,45,696/- has been shown as total receipts. Therefore, there is a difference of ₹ 34,030/-, which is not shown as income/revenue in any of the years and hence the same is sustained as addition. 7.3 Further, the appellant has claimed credit of TDS forthe year under consideration, though no corresponding income has been disclosed. Therefore, in view of the provisions of section 199 of the Act and looking to the fact that no income has been offered for tax during the year under consideratio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 6.1 On the other hand, ld. Sr. DR relied upon the order of ld. FAA. 7. Giving thoughtful consideration to the arguments and the matter on record it will be appropriate to reproduce the provisions of Section 199 of the Act and Rule 37 BA of the IT Rules, 1962 as below :- 199. (1) 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, or of the owner of the security, or of the depositor or of the owner of property or of the unit-holder, or of the shareholder, as the case may be. (2) Any sum referred to in sub-section (1A) of section 192 and paid to the Central Government shall be treated as the tax paid on behalf of the person in respect of whose income such payment of tax has been made. (3) The Board may, for the purposes of giving credit in respect of tax deducted or tax paid in terms of the provisions of this Chapter, 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... educted at source and paid to the account of the Central Government shall be granted on the basis of- (i) the information relating to deduction of tax furnished by the deductor to the income-tax authority or the person authorised by such authority; and (ii) the information in the return of income in respect of the claim for the credit, subject to verification in accordance with the risk management strategy formulated by the Board from time to time. 8. These provisions establish that the amount of tax deducted at source by the payer is treated as payment of tax on behalf of the payee and the credit for such tax deducted and paid is allowed for the assessment year for which such sum is assessable. The ld. F.A.A. has allowed ground no. 3 of the appellant while directing Ld. AO to verify the fact if appellant had offered revenue to tax in the earlier years and based upon same consider the deletion but at the same time disallowed the credit for the TDS for the reason that no income has been offered for tax during the year under consideration. 8.1 The Bench is of considered view that the provisions of Section 199 of the Act and Rule 37 BA of the IT Rules do not ..... X X X X Extracts X X X X X X X X Extracts X X X X
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