ITAT Directs Verification of TCS Claim and Credit Allocation Based on Assessee's Income for Relevant Year.

The ITAT remanded the case to the AO, directing verification of whether TCS was claimed by Shri Bheru Singh Tak. If not claimed, the AO must grant TCS credit to the assessee based on the income declared in the relevant assessment year. The Tribunal emphasized that TCS credit should align with the person assessed to tax.

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Issues:
Appeal against non-grant of TCS credit of Rs. 2,28,713 in proceedings u/s 154 for Assessment Year 2013-14.

Analysis:
The appeal was filed challenging the non-grant of TCS credit of Rs. 2,28,713 in proceedings u/s 154 for Assessment Year 2013-14. Initially, the matter was disposed of, but upon the assessee's application, the order was recalled for fresh adjudication. The facts revealed that the assessee's TCS was collected in the name of another party, Shri Bheru Singh Tak, with a different PAN. The Assessing Officer dismissed the rectification application under Rule 37BA. The CIT(A) upheld this decision, stating that the conditions under Rule 37BA(2) were not fulfilled by the deductee. The assessee contended that as per an agreement with Shri Bhairu Singh, he was not claiming any TCS in his personal tax return. The assessee argued for TCS credit based on similar cases where the matter was remanded for verification. The Department argued that the conditions under Rule 37BA(2) were not met by the assessee and distinguished the relied-upon cases due to lack of declarations by the main licensee regarding TCS claims.

During the proceedings, it was established that though TCS was collected in the name of Shri Bheru Singh Tak, the corresponding income was offered by the assessee and taxed. The Tribunal noted that TCS is an advance payment on behalf of the assessee and should be allowed if the income has been offered and taxed. Referring to similar cases, the Tribunal emphasized that TCS credit should go to the person assessed to tax, irrespective of the deductee. The Tribunal agreed with the assessee's argument that TCS credit should be granted, subject to the main licensee not claiming it. The matter was remanded to the Assessing Officer to verify if TCS was claimed by Shri Bheru Singh Tak and to allow the TCS corresponding to the income declared by the assessee.

In conclusion, the appeal was disposed of with directions to grant TCS credit to the assessee if not claimed by Shri Bheru Singh Tak, based on the income declared by the assessee in the return of income for the relevant assessment year.

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