ITAT allowed taxpayer's appeal regarding Tax Collected at Source ...

Parent Taxpayer Wins Appeal for TCS Credit on Minor Child's Income Despite Law Taking Effect in 2025

January 30, 2025

Case Laws     Income Tax     AT

ITAT allowed taxpayer's appeal regarding Tax Collected at Source (TCS) credit for minor child's income clubbed with parent's income. While statutory amendment permitting such credit becomes effective January 2025, ITAT held the amendment should apply retrospectively to prevent undue hardship. Following Allied Motors precedent on curative provisions, tribunal concluded that when minor's income is clubbed with parent's income, corresponding TCS credit must transfer to parent-assessee. Revenue authorities cannot retain collected tax without providing credit mechanism. AO directed to grant TCS credit to parent for minor's clubbed income.

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