Tribunal rules in favor of assessee, directing Assessing Officer to delete TDS addition

The tribunal set aside the CIT(A)'s order and directed the Assessing Officer to delete the addition of Rs. 80,000 on account of TDS, allowing the appeal in favor of the assessee. The tribunal held that the liability to pay TDS does not fall on the assessee when it has already been deducted by the licensee, emphasizing the responsibilities of the deductor in such cases.

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Issues Involved:
The judgment involves issues related to the appeal filed by the assessee against the order passed by the Commissioner of Income Tax (Appeals)-21, Mumbai for the Assessment Year 2013-14. The primary issue revolves around the denial of credit for TDS amount of Rs. 80,000 by the assessing officer, leading to the appeal and subsequent legal proceedings.

Issue 1-5 Analysis:
The key contention raised by the assessee was that they were not obligated to pay the TDS amount as per the agreement, where the payee was responsible for deducting and depositing the tax with the Government of India. The appellant argued that the revenue wrongly imposed the liability on them, contrary to law and facts. The assessee cited a precedent from the Hon'ble Bombay High Court to support their claim. However, the CIT(A) dismissed the appeal, stating that there was no evidence of TDS deduction as no certificate was issued to the appellant. The CIT(A) directed the Assessing Officer to verify the credit in department records. The tribunal, after reviewing the facts, found that the appellant had indeed entered into a leave and license agreement where TDS was deducted by the licensee but could not confirm if it was deposited with the Central Government. Relying on the precedent cited by the appellant, the tribunal held that the liability to pay TDS does not fall on the assessee when it has already been deducted by the licensee. The tribunal set aside the CIT(A)'s order and directed the Assessing Officer to delete the addition of Rs. 80,000 on account of TDS, allowing the appeal in favor of the assessee. It was clarified that recovery could be initiated against the person who deducted the TDS as per the law.

This detailed analysis of the judgment showcases the legal intricacies involved in the dispute over TDS credit and highlights how the tribunal interpreted the law to rule in favor of the appellant, emphasizing the responsibilities of the deductor in such cases.

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