TaxTMI 
TaxTMI 
2021 (6) TMI 65
X X X X Extracts X X X X
X X X X Extracts X X X X
....arbitrary, fallacious, conjectural and bad in law and face as well. 2. The Ld. CIT(A) did not give a sufficient opportunity to Appellant before passing the Assessment Order. 3. The Assessment is illegal, arbitrary, fallacious, conjectural and bad in law and face as well. 4. The appellant reserves the right to add or delete the ground of appeal. 2. Briefly stated facts of the case are that the assessee company was engaged in the business of construction, renovation reconstruction etc. of buildings, road, farmhouse etc. For the year under consideration, the assessee filed return of income on 25/09/2013, declaring income of Rs. 64,960/-. The return of income filed by the assessee was selected for scrutiny assessment and statutory notice....
X X X X Extracts X X X X
X X X X Extracts X X X X
....drawn from the year under consideration and same might be allowed in subsequent year(s), corresponding to the income offered. In Support of his contention, he relied on the decision of Tribunal, Mumbai Bench the case of Varsha G Salunke Vs DCIT, reported in 98 ITD 147. 4. The Learned DR, on the other hand, relied on the order of the lower authorities and submitted that Learned CIT(A) has correctly upheld the addition. 5. We have heard rival submission of the parties on the issue in dispute. The parties who have made payment to the assessee has deducted TDS at the rate of 2 percentile on entire payment of Rs. 1,08,23,026/-. The assessee claimed entire tax which was deducted by those parties (i.e deductor) but income of Rs. 46,06,843/- has ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....E, section 194F, section 194G, section 194H, section 194I, section 194J, section 194K, section 195, section 196A, section 196B, section 196C and section 196D to be treated as an income received. The purpose of section 198 is not to carve out an exception to section 145 of the Act. Section 199 of the Act has two objectives - one to declare the tax deducted at source as payment of tax on behalf of the person on whose behalf the deduction was made and to give credit for the amount so deducted on the production of the certificate in the assessment made for the assessment year for which such income is assessable. The second objective mentioned in section 199 is only to answer the question as to the year in which the credit for tax deducted at so....
X X X X Extracts X X X X
X X X X Extracts X X X X
....the assessee has offered the same to tax. Therefore, the credit in respect of these three TDS Certificates shall not be given in the assessment year under consideration, but the credit for the same shall be given in the next assessment year in which the income is shown to have been assessed. 7. In the light of the above discussions, I agree with the reasoning given by the learned Accountant Member, who has correctly directed the exclusion of the income represented by these three TDS Certificates from being assessed in the assessment year 1997-98, i.e., the year under consideration, But the assessee, in the light of the scheme of the provisions of sections 198 and 199 of the Act, shall not be allowed to claim the credit in respect of these....
X X X X Extracts X X X X
X X X X Extracts X X X X
....s even in respect of the services rendered to its clientele in the month of March, 1997 (to which the bills are not raised). These expenses have been undoubtedly incurred during the previous year in question. Only the matching receipts have not accrued to the assessee in the accounting year in question due to the method of accounting employed by her. But over the years, the effect on the profit & loss account gets neutralized. Sections 198 and 199, it may again be stressed, do not in any way determine the year of assessability of profits and gains of business. They only deal with the year in which the TDS Certificates have to be given credit to. In my humble opinion, the decision of the Hon'ble Supreme Court in the case of Tuticorin Alk....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ter the year of assessability of income, which is governed under section 28, 29 and 145 as has been interpreted by the Apex Court and as discussed by me above." 5.1 The Assessing Officer has though relied on above decision in his order, but in final para he has done reverse to the ratio of decision. Following the decision, the Assessing Officer was required to exclude the credit of the TDS, but instead, he added the advance amount as income of the assessee in the year under consideration. The action of the Assessing Officer without any reasoning is not justified. Simultaneously, the claim of the entire amount of the TDS by the assessee in the year under consideration is also not justified. The Ld. CIT(A) noted this fact, however, she uphel....