TDS credit cannot be denied for non-filing where corresponding income was taxed, subject to verification of records.

TDS credit should not be denied merely because no return was filed where the related receipts were assessed as income and tax had been deducted on them. The article states that credit is consequential to the assessment of the corresponding income, but it must be verified against Form 26AS and departmental records. On that basis, the matter was remitted to the Assessing Officer to examine the records and grant due TDS credit in accordance with law.

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Issues: Entitlement to credit of tax deducted at source where the corresponding receipts were assessed as income, and the matter required verification of Form 26AS and departmental records.

Analysis: The assessment was reopened on AIR information and the assessee did not file a return or comply with notice under section 148, leading to an ex parte assessment on receipts reflected in Form 26AS. Since those receipts were brought to tax and tax had been deducted at source on them, denial of corresponding credit merely because no return was filed would be technical. Credit for TDS is consequential to assessment of the related income, but it must be verified against Form 26AS and departmental records.

Conclusion: The assessee was held entitled to consideration of TDS credit after verification, and the issue was sent back to the Assessing Officer for grant of due credit in accordance with law.

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