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TMI Blog2023 (12) TMI 275X X X X Extracts X X X X X X X X Extracts X X X X ..... ome from other sources. Hence, when there is no obligation on the part of the assessee to offer the said interest income to tax as per the provisions of the Act, and the same have been duly reflected in the books of accounts and audited balance sheet of the assessee, the TDS claimed relatable to such interest receipts cannot be denied to the assessee. We find that the CPC had denied the TDS figure only on the ground that the said TDS figure was not reflected in the Form 26AS of the assessee. We find from updated Form 26AS of the assessee, the very same TDS figure of Rs. 10,80,720/- is duly reflected and hence grievance of the CPC has been duly met. Hence, as per rule 37BA for the Income Tax Rules, the assessee shall be entitled for TDS cred ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Appeal Centre (NFAC) is bad both in the eyes of law and on facts. 2. (i) On the facts and circumstances of the case, the learned CIT(A), NFAC has erred both on facts and in law in confirming the action of the AO (CPC) disallowing the credit of Rs 10,80,720/- on account of Tax deducted at source (TDS) claimed by the assessee. (ii) That the above disallowance of credit has been confirmed ignoring the contention of the assessee that the amount claimed by the assessee is appearing in Form 26A5 uploaded in the Income Tax e-filing portal. 3. On the facts and circumstances of the case, the learned CIT(A). NFAC has erred both on facts and in law in ignoring the contention of the assessee that the claim of TDS has been denied without specifyin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 0/- was not granted by the Ld. CPC u/s 143(1) of the Act, on the ground that the same is not reflected in Form No. 26AS of the assessee. This action of the Ld. CPC was upheld by the Ld. CIT(A) / (NFAC) by observing as under: 6. During appellate proceedings, in response to the hearing notice u/s 250 dated 18.10.2022 fixed for hearing on 27.10.2022 the appellant stated in his reply dated 27.10.2022 that the reason stated is mismatch in TDS credit whereas there is no mismatch. It appears to be a technical glitch in processing and rectification application was rejected without proper application of mind. TDS credit is fully available in 26AS, but effect not given in the refund processing. The TDS claimed by the appellant as per table is repro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed under 'Expenditure during the construction period' and since the interest income earned on advances given to the contractors was inextricably linked with the business activity of the assessee, the same was duly reduced from the said project expenditure reflected in 'Expenditure during the construction period' in Balance Sheet. We find that there is absolutely no dispute that the interest earned on advances of the contractors were part of business receipts and since the assessee had not commenced its business, the said interest income was duly reduced by the assessee from expenditure during the construction period in this balance sheet. It is not the case of the Revenue that the said interest income would be liable to be taxed under the h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... evelopment. The assesses following Project Completion Method to recognize its revenue. The assesses is now claiming credit of TUS which has been earlier denied to the assessee. As per provisions of section 159 of the Act, tax deducties at source and paid to government exchequer is treated as payment of tax on behalf of the person for whom TDS was made. Rule 37BA(3) further clarifies that credit for TDS shall be given for assessment year for which such income is assessable. 8. In the case of Supreme Renewable Energy Vs. ITO (supra) the Tribunal following the decision in the Case of CIT vs. Karnal Co-Op Sugar Mills Ltd., 243 ITR 2(SC) held that when the interest inn in the nodental to the acquisition and installation of an asset and not dir ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... chinery would be lesser and the net result of this would be offering the same income otherwise. 7. xxxxxxxxxxxxx 8. xxxxxxxxxxx 9. From the above it is clear that when a particular income is received by the assessee after deduction of tax at source and the said TDS has been duly deposited with the Government and the assessee has received the requisite certificate to this effect, then on production of the said certificate the assessee becomes entitled for the credit of TDS even if the assessee has not directly offered the said income for tax, no the assessee considered the same was liable to tax. 10. In view of the above mentioned decisions of the Supreme Court and order of this Tribunal, clear position of law that when TDS is made o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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