9911796707
TMI Blog2025 (1) TMI 1401X X X X Extracts X X X X X X X X Extracts X X X X ..... r mechanism has been provided to allow such TCS in the Act till the amendment which took place effective only from 1st day of January, 2025 and therefore, such claim of the assessee cannot be entertained is concerned, the same, in our opinion, cannot deprive the assessee from his legitimate claim of TDS / TCS, the income of which has already been offered to tax. Therefore, such amendment in our opinion should be held as retrospective in nature and not to the detriment of the assessee against a legitimate claim. We find in the case of Allied Motors (P) Ltd. [1997 (3) TMI 9 - SUPREME COURT] has held that a proviso which is inserted to remedy unintended consequences and to made the provision workable, a proviso which supplies an obvious omission in the section and is required to be read into the section to give the section a reasonable interpretation, requires to be treated as retrospective in operation so that a reasonable interpretation can be given to the section as a whole. It has further been held that "it is well settled that if a statute curative or merely declaratory of the previous law retrospective operation is generally intended. In fact the amendment would not serve its ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Board to notify the rules for cases where credit of tax collected are given to person other than the collectee. However, to ensure that this provision is not misused, credit of TCS of the minor shall only be allowed where the income of the minor is being clubbed with the parent as under sub-section (1A) of section 64 of the Act which states that in computing the total income of any individual, there shall be included all such income as arises or accrues to his minor child. Although this amendment was effective from 1st day of January, 2025 it was submitted that since no mechanism is still provided to allow such TCS credit, the assessee cannot be deprived of the TCS credit of the minor child in his hands. 5. However, the Ld. Addl./JCIT(A) was not satisfied with the arguments advanced by the assessee and rejected the claim of the TCS credit of Rs. 9,50,200/- by observing as under: "4. Decision The appellant had filed his Income tax return for the year 2024-25 on 30.07.2024 declaring a total income of RS 38,76,29,470/- claiming total TDS of Rs. 14,53,50,759/- & TCS of RS 25,28,802/-. Out of the total TCS claimed, an amount of Rs. 15,78,602/- collected for self and TCS of Rs. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for the assessee at the outset submitted that it is an admitted fact that the income of the minor child was clubbed in the hands of the assessee, therefore, the TCS collected in the hands of the minor child should be given due credit in the hands of the assessee. He submitted that refusing the TCS credit of Rs. 9,50,200/- collected in the name and PAN of the minor child, whose income was clubbed in the hands of the assessee, will cause undue hardship to the assessee and the assessee cannot be remediless. He submitted that if the amount of Rs. 9,50,200/- collected towards TCS is not given due credit to the assessee, then the assessee may never get this refund. 8. Referring to the decision of the Hon'ble Supreme Court in the case of Genpact India Pvt. Ltd. vs. DCIT (2019) 265 DLT 123, he drew the attention of the Bench to the observations of the Hon'ble Supreme Court and submitted that the assessee cannot be deprived of his legitimate right and cannot lose a remedy. 9. The Ld. Counsel for the assessee also filed a copy of the Notification No.114/2024, dated 16.10.2024, copy of which is placed at page 63 of the paper book and which reads as under: "MINISTRY OF FINANCE (De ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n of tax at source under sub-section (3) of section 206C of the Act, in the name of the person in whose name credit is shown in the information relating to collection of tax referred to in sub-rule (1) and shall keep the declaration in his safe custody."; (c) in Form No. 27EQ, in the Annexure, after Verification, in the Notes, after Note 8, the following Note shall be inserted, namely:- '8A. Write "J" if no collection or lower collection is in view of notification issued under sub-section (12) of section 206C.'. [No. 114/2024/F. No. 370142/21/2024-TPL] KHUSHBOO LATHER, Under Secy. Note : The Income-tax Rules, 1962 were published in the Gazette of India, Extraordinary, Part II, section 3, sub-section (ii) vide notification number S.O. 969 (E), dated the 26th March, 1962 and were last amended vide notification number G.S.R 639 (E), dated the 15th October, 2024." 10. Similarly, he drew the attention of the Bench to rule 37(1) of the Income Tax Rules, which reads as under: [Credit for tax collected at source for the purposes of sub-section (4) of section 206C. 37-1. (1) Credit for tax collected at source and paid to the Central Government in accordance with provi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e and paid to the account of the Central Government shall be granted on the basis of (i) the information relating to collection of tax furnished by the collector 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.] 11. Referring to the following decisions, he submitted that due credit should be given to the assessee: a) Aluminium Corporation of India Ltd. vs. Union of India & Ors. 1975 AIR 2279 b) Pinnacle Vastunirman Pvt. Ltd. vs. Union of India (2021) 438 ITR 27 (Bom) 12. Referring to the decision of the Hon'ble Supreme Court in the case of Allied Motors (P) Ltd. vs. CIT (1997) 224 ITR 677 (SC), he submitted that the Hon'ble Supreme Court in the said decision has held that a proviso which is inserted to remedy unintended consequences and to made the provision workable, a proviso which supplies an obvious omission in the section and is required to be read into the section to give the section a reasonable interpretation, requires to be treated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... other mechanism has been provided to allow such TCS credit in the Act till the said amendment which took effect only from 1st day of January, 2025, therefore, such claim of the assessee cannot be entertained. In our opinion, since the income of the minor child was clubbed with the income of the assessee, the corresponding TCS collected in the hands of the minor also should be allowed and due credit should be given in the hands of the assessee. In our opinion, the Revenue cannot be allowed to retain the tax deducted at source or tax collected at source without credit being available to anybody. In our opinion, if the credit of tax is not allowed to the assessee, then credit of TCS cannot be taken by anybody. 15. So far as the contention of the Revenue that the Memorandum explaining the provisions in the Finance Bill, 2024 regarding the credit of tax collected to be given to the persons other than the collectee is applicable from 1st day of January, 2025 and since so other mechanism has been provided to allow such TCS in the Act till the amendment which took place effective only from 1st day of January, 2025 and therefore, such claim of the assessee cannot be entertained is concern ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
