Tax deduction certificates and refund jurisdiction: credit follows verified Form C-II, and claims must go to the proper authority.

A refund claim supported by a tax deduction certificate could not be refused merely because the assessee did not separately prove deposit of the deducted tax; once Form C-II was produced, the department had to verify the certificate's genuineness and treat the tax as payment on the assessee's behalf for credit purposes. The refund application also had to be presented before the authority having monetary jurisdiction, and where the amount exceeded the prescribed limit of Rs. 50,000, the Deputy Commissioner had no jurisdiction to entertain or decide it. The rejection order was therefore set aside and the matter was to be placed before the competent Joint Commissioner for fresh consideration.

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Issues: (i) whether deduction of tax at source evidenced by Form C-II entitled the assessee to credit or refund without insisting on proof of deposit by the assessee; (ii) whether the Deputy Commissioner had jurisdiction to entertain and decide a refund claim exceeding the prescribed monetary limit.

Issue (i): Whether deduction of tax at source evidenced by Form C-II entitled the assessee to credit or refund without insisting on proof of deposit by the assessee.

Analysis: Once the assessee produced Form C-II showing deduction of tax at source, the burden was not on the assessee to prove deposit of the deducted tax. The departmental authorities were required to verify the genuineness of the certificate, and the tax deducted at source had to be treated as payment on behalf of the assessee for the purpose of credit.

Conclusion: The assessee was entitled to credit on production of Form C-II, subject to verification of genuineness, and the refund claim could not be rejected for want of proof of deposit by the assessee.

Issue (ii): Whether the Deputy Commissioner had jurisdiction to entertain and decide a refund claim exceeding the prescribed monetary limit.

Analysis: Under the governing refund provision, where the refund amount exceeded Rs. 50,000, the application had to be filed before the Joint Commissioner. As the applications were not presented before the prescribed authority, the proceedings before the Deputy Commissioner and the rejection order passed by him were without jurisdiction.

Conclusion: The Deputy Commissioner lacked jurisdiction, and the order rejecting the refund applications was quashed.

Final Conclusion: The refund proceedings were set aside for want of jurisdiction and the claims were directed to be presented before the competent Joint Commissioner for fresh consideration within the time fixed by the Court.

Ratio Decidendi: A refund claim supported by a tax deduction certificate cannot be defeated by insisting that the assessee prove deposit of the deducted tax, and a refund application must be filed and decided only by the authority designated under the governing monetary jurisdiction.

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