Case laws regarding tds
This query is : Resolved
02 February 2018
Dear All,
Our company completed the assessment for various financial years. But problem is ITO & Commissioner of Income raised demand of around Rs.700000/- by way of Interest & TDS . This TDS is not paid by Kingfisher Airlines. My question is whether is there any case law for which if a company which deduct tds not paid to the Government Treasury. And if Assessee take the Tax credit of The TDS which are not paid by the deductee company. Kindly suggest the Case laws or solutions in this Case.
Thanks.
Regards,
Kiran
Our company completed the assessment for various financial years. But problem is ITO & Commissioner of Income raised demand of around Rs.700000/- by way of Interest & TDS . This TDS is not paid by Kingfisher Airlines. My question is whether is there any case law for which if a company which deduct tds not paid to the Government Treasury. And if Assessee take the Tax credit of The TDS which are not paid by the deductee company. Kindly suggest the Case laws or solutions in this Case.
Thanks.
Regards,
Kiran
02 February 2018
Please read circular number 275/29/2014. 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.
INSTRUCTION NO. 275/29/2014-IT-(B), DATED 1-6-2015
Grievances have been received by the Board from many taxpayers that in their cases the deductor has deducted tax at source from payments made to them in accordance with the provisions of Chapter-XVII of the Income-tax Act, 1961 (hereafter 'the Act') but has failed to deposit the same into the Government account leading to denial of credit of such deduction of tax to these taxpayers and consequent raising of demand.
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.
3. This may be brought to the notice of all the Assessing Officers in your region so that if the facts of the case so justify, the assessees are not put at any inconvenience on account of default of deposit of tax into the Government account by the deductor.
4. This issues with the approval of Chairperson, CBDT.
INSTRUCTION NO. 275/29/2014-IT-(B), DATED 1-6-2015
Grievances have been received by the Board from many taxpayers that in their cases the deductor has deducted tax at source from payments made to them in accordance with the provisions of Chapter-XVII of the Income-tax Act, 1961 (hereafter 'the Act') but has failed to deposit the same into the Government account leading to denial of credit of such deduction of tax to these taxpayers and consequent raising of demand.
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.
3. This may be brought to the notice of all the Assessing Officers in your region so that if the facts of the case so justify, the assessees are not put at any inconvenience on account of default of deposit of tax into the Government account by the deductor.
4. This issues with the approval of Chairperson, CBDT.
08 February 2018
Dear Sir,
Thanks for the reply but can you provide any judgement given by the court in this cases
Thanks for the reply but can you provide any judgement given by the court in this cases
08 February 2018
Kiran the burden of proof is on the assessee to proof to the AO that the tax has actually been deducted by the other party but has not been deposited. Otherwise, it will become very difficult to claim the benefit of the circular which i had listed above.
But you can refer a case law [1999] 235 ITR 433 (Gujarat)
HIGH COURT OF GUJARAT
Commissioner of Income-tax v. Ranoli Investment (P.) Ltd.
This will give you the clarity.
But you can refer a case law [1999] 235 ITR 433 (Gujarat)
HIGH COURT OF GUJARAT
Commissioner of Income-tax v. Ranoli Investment (P.) Ltd.
This will give you the clarity.
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