TaxTMI 
TaxTMI 
2014 (9) TMI 1076
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.... confirming the order of AO disallowing credit of TDS at Rs. 1,48,078/-. For this assessee has raised following ground nos. , 3 and 4: "2. On the facts and ìn the circumstances of the case, the learned CIT(A) erred in upholding the order of the A.O. disallowing credit in respect of the amount of tax deducted at source of Rs. 1,49,078/- in the name of the parthership firm M/s Tiwari & Co. of which the appellant was an erstwhile partner and which remained fully converted into the proprietorship concern of the appellant throughout the period covered by the appellate year under consideration. 3. On the facts and in the circumstances of the case, the learned CIT(A) erred in neglecting to take ìnto account the fact....
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....edit claimed for TDS certificates issued in favour of M/s. Tiwari & Co. for the reason that M/s. Tiwari & Co. became proprietorship concern of the assessee and earlier this was a partnership firm. This partnership firm M/s. Tiwari & Co. got discontinued w.e.f. 30.12.2006. Before the AO, the assessee relied on the provisions of section 37BA of the I. T. Rules, 1962 (hereinafter referred to as "the Rules"), wherein M/s. Tiwari & Co. declared and confirmed that the income on which tax has been deducted at source for AY 2008-09 relevant to FY 2007-08 is assessable in the hands of the assessee Mr. Parmanand Tiwari other than the deductee and credit for such deduction of tax at source be given to him as income on account of TDS is includible in t....
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....ntention of the assessee is not tenable." Aggrieved, assessee came in appeal before CIT(A), who also confirmed the action of AO by observing as under: "The rule even though available for subsequent year, makes it abundantly clear that credit will be given based on the information by the deductor. The only mitigating circumstances has been given in the proviso, when the deductee (in this case M/s. Tiwari & Co. partnership firm), files a declaration to the deductor, and the deductor report the tax deduction in the name of the other person. 4.3. In view of the above the A.O. has correctly not given credit to TDS made in the name of M/s. Tiwari & Co. partnership firm, in the hands of appellant, erstwhile partner, even thoug....
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....ough the facts in entirety, I find that this is only a technical breach and that also for the reason that these professional receipts received by the assessee are commitment of earlier years when the firm was in existence. These receipts are earned by the professional work of M/s. Tiwari & Co. as proprietary concern in individual capacity of Shri Parmanand Tiwari. Wrong submission of PAN by deductors does not debar for claiming of TDS deducted particularly when the income is included in the hands of the assessee. Now the legislature, to mitigate the rigours of law, has amended the provisions of section 37BA of the Act by the Amendment Rules, 2009 w.e.f. 01.04.2009. The relevant rule reads as under: "Credit for tax deducted at sourc....
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....ll keep the declaration in his safe custody. (3) (i) Credit for tax deducted at source and paid to the Central Government, shall be given for the assessment year for which such income is assessable. (ii) Where tax has been deducted at source and paid to the Central Government and the income is assessable over a number of years, credit for tax deducted at source shall be allowed across those years in the same proportion in which the income is assessable to tax. (4) Credit for tax deducted at source and paid to the account of the Central Government shall be granted on the basis of- (i) the information relating to deduction of tax furnished by the deductor to the income-tax authority or the person authorised by such authority; and ....
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....the deductor and the deductor reports the tax deduction in the name of other person in the information relating to deduction of tax as referred to in sub-rule (1) of Rule 37BA of the Rules. In such provisions of law, the assessee should have been allowed credit for TDS in the given set of facts and circumstances of the case. The only issue is that the amended provision is applicable w.e.f. 01.04.2009 and the relevant assessment year involved is 2008-09. Whether the amended Rule as amended by Amendment Rules, 2009 is a beneficial provision mitigating the hardship of the assessee and in turn the same can be declared as retrospective and will apply to all pending matters. Similar issue was dealt by Hon'ble Supreme Court in the case of Allied M....