TaxTMI 
TaxTMI 
2023 (11) TMI 808
X X X X Extracts X X X X
X X X X Extracts X X X X
.... preferred by the petitioner pursuant to the order dated 21.09.2023 passed by this court. 2. This application has been filed to challenge the order dated 25.06.2020 passed by respondent no. 4 under Section 154 of the Income Tax Act, 1961 [in short, "Act"]. 3. The said order was passed pursuant to a rectification application filed by the petitioner concerning the Return of Income (ROI) dated 10.08.2019. 3.1. Via the rectification application, the petitioner sought to stake a claim with respect to the tax which had been deducted at source on the interest paid by its borrower, namely, Ninex Developers Ltd. [hereafter referred to as "Ninex"]. 3.2. This application was dismissed via the aforesaid order. 4. The petitioner, h....
X X X X Extracts X X X X
X X X X Extracts X X X X
....dditional prayer, thus, stands embedded in the original writ petition, whereby challenge is laid to the order dated 25.06.2020 passed under Section 154 of the Act. 9.1. Since this is the only amendment that is made to the original writ petition, Mr Hossain says that he does not wish to file a fresh counter-affidavit in the matter. 10. We may note that although vis-à-vis the original writ petition, no counter-affidavit has been filed, written submissions have been submitted on behalf of the respondent/revenue. 11. Thus, the backdrop in which the petitioner has approached this court is briefly the following. 11.1 In Financial Year (FY) 2018-19 [relevant to the Assessment Year (AY) 2019-20], the petitioner had advanced a loa....
X X X X Extracts X X X X
X X X X Extracts X X X X
....s reported, as per 26AS no credit Rs. 29,16,674 is reflecting. AO have therefore restricted the TDS credits to provide only amount available in 26AS. Hence, no action is pending at AO end." 16. It is against this backdrop that the instant writ action has been filed by the petitioner. 18. The record shows that, although Ninex deducted TAS amounting to Rs. 29,16,674/-, it did not deposit the aforementioned amount with the revenue. 19. Given this position, the moot issues which arises for consideration are the following: (i). Firstly, whether any recovery towards TAS can be made against the petitioner? (ii). Secondly, whether the petitioner can obtain the credit of TAS? 20. Both the issues stand covered by the jud....
X X X X Extracts X X X X
X X X X Extracts X X X X
....laces a bar on a direct demand qua the deductee assessee, the same cannot be enforced coercively. For the sake of convenience, paragraph 2 of the said Instruction is extracted hereafter: "...2. As per Section 199 of the Act credit of Tax Deducted at Source is given to the person only if it is paid to the Central Government Account. However, as per Section 205 of the Act the assessee shall not be called upon to pay the tax to the extent tax has been deducted from his income where the tax is deductible at source under the provisions of Chapter XVII. Thus the Act puts a bar on direct demand against the assessee in such cases and the demand on account of tax credit mismatch cannot be enforced coercively..." 9. The question, th....
X X X X Extracts X X X X
X X X X Extracts X X X X
....er being considered, was rejected. [See paragraph 5 of the judgement]. 21.2. Since repeated arguments are raised by the respondents/revenue based on the provisions of Section 199 of the Act, we intend to elaborate on the rationale provided in Sanjay Sudan's case. It is required to be emphasized that deduction of taxes at source is one of the methods of collecting tax. The TAS deducted at source is part of the asssseee's income and therefore, the gross amount is included in the total income and offered to tax. It is on this premise that the tax deducted at source would have to be treated as tax paid on behalf of the assessee. The TAS is deducted prior to the assessment being completed. Thus, it is only when the relevant previous year is o....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ed as payment in accordance with the law. 22. Thus, given the factual and legal position, the relief sought for by the petitioner would have to be granted. 23. Accordingly, the writ petition is disposed of with the following directions: (i) The petitioner will be given credit for TAS amounting to Rs. 29,16,674/-, notwithstanding the fact that it is not reflected in Form 26AS. (ii) The order dated 25.06.2020 passed under Section 154 of the Act, given the relief granted above, cannot survive, as, according to learned counsel for the parties, the only rectification that was sought was with regard to the aforementioned TAS deducted by Ninex. The order is, accordingly, set aside. 24. We may make it clear that since the....