2016 (4) TMI 1453

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....e order dated 31.12.2013, at the returned income. The assessee had claimed credit of TCS of Rs. 35,26,813/- in its return of income but in the intimation u/s 143(1) of the Act, the claim of TCS was restricted at Rs. 89,163/- as reflected in the 26AS Form of the assessee for assessment year 2012-13. 3. The matter carried to the ld. CIT(A) and the ld. CIT(A) dismissed the appeal. 4. The ld.Authorized Representative for the assessee has argued before us that in this case, the only dispute is giving short credit of TCS. The assessee claimed that the assessee is a partnership firm. Partners were license-holder and they have formed the partnership firm to carry on business in liquor. Therefore, TCS certificate was issued in the name of partners....

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.... to the facts and circumstances of the case, we find that as per Section 199, which reads as under:- "Section 199(1) of the Income-tax Act, 1961, provides that any deduction of tax made in accordance with the provisions of Chapter XVII of the Act and paid to the Central Government shall be treated as a payment of tax on behalf of the person from whose income the deduction was made. Under sub Section (3) of Section 199, the CBDT may, for the purpose of giving credit in respect of tax deducted at source or paid in terms of the provisions of Chapter XVII of the Act, make such rules as may be necessary, including the rules for the purpose of giving credit to a person other than those referred to in sub Section (1) and sub Section (2) and also....

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....the income from a property, deposit, security, unit or share held in the name of a deductee is owned jointly by the deductee and other persons and the income is assessable in their hands in the same proportion as their ownership of the asset: Provided that the deductee files a declaration with the deductor and the deductor reports the tax deduction in the name of the other person in the information relating to deduction of tax referred to in sub-rule (1). (ii) The declaration filed by the deductee under clause (i) shall contain the name, address, permanent account number of the person to whom credit is to be given, payment or credit in relation to which credit is to be given and reasons for giving credit to such person. (iii) The d....

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....eductee, credit for the whole or any part of the tax deducted at source, as the case may be, shall be given to the other person and not to the deductee." This amendment has done away with the specified four clauses in the pre-amended Rule 37BA which restricted the benefit of the rule only in four specified situations. It has thus widened the scope of the rule 37BA thereby enabling the credit of taxes to the actual payee in whose hands the income is assessable and not restricting this benefit only to the specified four situations." 8. As per above rules and interpretation of the Act, we are of the view that if the assessee is a partnership firm to carry on the business in liquor and TCS is claimed in the name of partner of the firm, the....