SHIVGYAN DEVELOPERS LTD, JAIPUR V. INCOME TAX OFFICER, WARD-6-1, JAIPUR

ITA 1342/JPR/2018

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 0773 (ITAT-JAIPUR)
• Duration Of Justice: 8 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-08-2019
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2013-2014
• Appeal Filed On: 30-11-2018
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: ANURADHA JCIT DHK
• Assessee Lawyers: S L PODDAR
• Keywords: Capital asset; Revenue expenditure; Capital expenditure; TDS
• Section: 37(1); 192

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCH B, JAIPUR JH JES'K LH- 'KEKZ] YS[KK LNL; ,O A H JH FOT; IKY JKWO] U;KF;D LNL; DS LE{K BEFORE: SHRI RAMESH C. SHARMA, AM & SHRI VIJAY PAL RAO, JM VK;DJ VIHY LA-@ ITA NO. 1342/JP/2018 FU/KZKJ.K O'K Z@ ASSESSMENT YEAR : 2013-14. SHIVGYAN DEVELOPERS LTD., 16, GOVIND MARG, ADARSH NAGAR, JAIPUR. CUKE VS. THE INCOME TAX OFFICER, WARD 6(1), JAIPUR. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN NO. AAACS 6185 K VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY : SHRI S.L. PODDAR (ADVOCATE) JKTLO DH VKSJ LS@ REVENUE BY : MS ANURADHA (JCIT) LQUOKBZ DH RKJH[K@ DATE OF HEARING : 19.08.2019. ?KKS'K .KK DH RKJH[K@ DATE OF PRONOUNCEMENT : 20/08/2019. VKNS'K@ ORDER PER VIJAY PAL RAO, JM : THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST TH E ORDER DATED 18.10.2018 OF LD. CIT (A), AJMER FOR THE ASSESSMENT YEAR 2013-14. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS :- 1. UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE THE LEARNED CIT (A) HAS ERRED IN PASSING THE EX PARTE ORDER WITHOUT GIVING ANY OPPORTUNITY TO THE ASSESSEE OF BEING HEARD. 2. UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE TH E LEARNED CIT (A) HAS ERRED IN CONFIRMATION THE ADDITION OF RS. 1 ,68,821/- MADE BY THE LEARNED AO ON ACCOUNT OF CAPITAL INTROD UCED. 3. IN THE FACTS AND CIRCUMSTANCES OF THE CASE THE L EARNED CIT (A) HAS ERRED IN DOT NOT THE CREDIT OF TDS OF RS. 3,20, 835/- CLAIMED BY THE ASSESSEE. 4. THE ASSESSEE CRAVES YOUR INDULGENCE TO ADD, AMEN D OR ALTER ALL OR ANY GROUNDS OF APPEAL BEFORE OR AT THE TIME OF H EARING. 2 ITA NO. 1342/JP/2018 M/S. SHIVGYAN DEVELOPERS LTD., JAIPUR. GROUND NO. 1 IS REGARDING PASSING EX PARTE ORDER BY THE LD. CIT (A) AND DENIAL OF OPPORTUNITY OF HEARING. 2. AT THE TIME OF HEARING, THE LD. COUNSEL FOR THE ASSESSEE HAS STATED AT BAR THAT THE ASSESSEE DOES NOT PRESS GROUND NO. 1 OF THE APP EAL AND THE SAME MAY BE DISMISSED AS NOT PRESSED. THE LD. D/R HAS RAISED N O OBJECTION IF GROUND NO. 1 OF THE ASSESSEES APPEAL IS DISMISSED AS NOT PRESSED. ACC ORDINGLY GROUND NO. 1 OF THE ASSESSEES APPEAL IS DISMISSED BEING NOT PRESSED. GROUND NO. 2 IS REGARDING DISALLOWANCE OF FEE PAID TO REGISTRAR OF COMPANIES FOR INCREASE OF AUTHORIZED CAPITAL. 3. THE ASSESSEE IS A PRIVATE LIMITED COMPANY AND EN GAGED IN THE BUSINESS OF CONSTRUCTION AND REAL ESTATE DEVELOPMENT. DURING TH E COURSE OF ASSESSMENT PROCEEDINGS, THE AO DISALLOWED A SUM OF RS. 1,68,82 1/- ON ACCOUNT OF FEE PAID TO ROC FOR INCREASE OF AUTHORIZED CAPITAL OF THE ASSES SEE COMPANY BY TREATING THE SAME AS CAPITAL IN NATURE. THE LD. CIT (A) HAS CONFIRME D THE DISALLOWANCE MADE BY THE AO. 4. BEFORE US, THE LD. A/R OF THE ASSESSEE HAS SUBMI TTED THAT DURING THE YEAR UNDER CONSIDERATION THE ASSESSEE COMPANY HAS INCREA SED ITS AUTHORIZED CAPITAL FROM RS. 17,00,000/- TO RS. 36,00,000/- FOR WHICH THE AS SESSEE HAS PAID A TOTAL AMOUNT OF RS. 1,68,821/- TOWARDS CAPITAL INCREASE FEES TO ROC . THE EXPENDITURE INCURRED WAS IN THE NATURE OF REVENUE AND IT IS ALLOWABLE REVENU E EXPENDITURE. THE LD. A/R HAS RELIED UPON THE FOLLOWING DECISIONS :- CIT VS. KISENCHAND CHELLARAM (INDIA) P. LTD. 130 ITR 385 (MADRAS HC) WARNER HINDUSTAN LTD. VS. CIT 171 ITR 224 (AP) 3 ITA NO. 1342/JP/2018 M/S. SHIVGYAN DEVELOPERS LTD., JAIPUR. THUS THE LD. A/R HAS CONTENDED THAT WHEN THE ASSESS EE HAS PAID THE FEES FOR INCREASE IN THE AUTHORIZED CAPITAL AND THERE IS NO INCREASE IN THE PAID UP CAPITAL TO BE UTILIZED FOR ACQUIRING ANY CAPITAL ASSET, THEN T HE SAID EXPENDITURE INCURRED BY THE ASSESSEE IS AN ALLOWABLE REVENUE EXPENDITURE. 5. ON THE OTHER HAND, THE LD. D/R HAS SUBMITTED THA T THE EXPENDITURE INCURRED BY THE ASSESSEE TOWARDS INCREASE OF AUTHORIZED CAPI TAL IS IN THE NATURE OF CAPITAL EXPENDITURE AND NOT AN ALLOWABLE REVENUE EXPENDITUR E. SHE HAS RELIED UPON THE DECISION OF HONBLE SUPREME COURT IN CASE OF PUNJAB STATE INDUSTRIAL DEVELOPMENT CORPORATION LTD. VS. CIT, 225 ITR 792 (SC). THUS T HE LD. D/R HAS SUBMITTED THAT IN VIEW OF THE HONBLE SUPREME COURT DECISION ON THE P OINT, THE FEE PAID TO THE REGISTRAR FOR EXPANSION OF CAPITAL BASE OF THE COMP ANY WAS DIRECTLY RELATED TO THE CAPITAL EXPENDITURE INCURRED BY THE COMPANY. THE H ONBLE SUPREME COURT HAS ALSO OBSERVED THAT ALTHOUGH INCIDENTALLY IT WOULD HELP I N THE BUSINESS OF THE COMPANY AND MAY ALSO HELP IN PROFIT MAKING, BUT IT STILL RETAIN S THE CHARACTER OF A CAPITAL EXPENDITURE SINCE THE EXPENDITURE WAS DIRECTLY RELA TED TO THE EXPANSION OF THE CAPITAL BASE OF THE COMPANY. 6. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AS WELL AS THE IMPUGNED ORDERS OF THE AUTHORITIES BELOW. THERE IS NO DISPUTE THAT THE ASSESSEE HAS INCURRED THIS EXPENDITURE OF RS. 1,68,821/- TOWARDS FEES PAID TO REGISTRAR OF COMPANIES IN RESPECT OF INCREASE IN AUTHORIZED CAPITAL. THE DECISIONS R ELIED UPON BY THE LD. A/R OF THE ASSESSEE HAVE BEEN CONSIDERED BY THE HONBLE SUPREM E COURT WHILE PASSING THE JUDGMENT IN CASE OF PUNJAB STATE INDUSTRIAL DEVELOP MENT CORPORATION LTD. VS. CIT (SUPRA) AND HELD IN PARA 4 TO 7 AS UNDER :- 4 ITA NO. 1342/JP/2018 M/S. SHIVGYAN DEVELOPERS LTD., JAIPUR. 4. WE MAY ALSO INDICATE THAT THIS COURT LAID DOWN THE TEST FOR DETERMINING WHETHER A PARTICULAR EXPENDITURE IS REVENUE OR CAPI TAL EXPENDITURE IN THE CASE OF EMPIRE JUTE CO. LTD. V. CIT [1980] 124 ITR 1/3 TAXMAN 69 (SC) . IN THAT DECISION, THIS COURT SURVEYED THE LAW ON THE SUBJEC T IN CONSIDERABLE DETAIL AND OBSERVED AS UNDER : 'THE DECIDED CASES HAVE, FROM TIME TO TIME, EVOLVED VARIOUS TESTS FOR DISTINGUISHING BETWEEN CAPITAL AND REVENUE EXPENDIT URE BUT NO TEST IS PARAMOUNT OR CONCLUSIVE. THERE IS NO ALL EMBRACING FORMULA WHICH CAN PROVIDE A READY SOLUTION TO THE PROBLEM; NO TOUCHST ONE HAS BEEN DEVISED. EVERY CASE HAS TO BE DECIDED ON ITS OWN FA CTS, KEEPING IN MIND THE BROAD PICTURE OF THE WHOLE OPERATION IN RE SPECT OF WHICH THE EXPENDITURE HAS BEEN INCURRED. BUT A FEW TESTS FORM ULATED BY THE COURTS MAY BE REFERRED TO AS THEY MIGHT HELP TO ARRIVE AT A CORRECT DECISION OF THE CONTROVERSY BETWEEN THE PARTIES. ONE CELEBRATED TEST IS THAT LAID DOWN BY LORD CAVE, L.C. IN ATHERTON V. BRITISH INSULATED & HELSBY CABLES LTD. [1925] 10 TC 155, 192 (HL), WHERE THE LEARNED LAW L ORD STATED : '.....WHEN AN EXPENDITURE IS MADE, NOT ONLY ONCE AN D FOR ALL, BUT WITH A VIEW TO BRINGING INTO EXISTENCE AN ASSET OR AN ADVA NTAGE FOR THE ENDURING BENEFIT OF A TRADE, I THINK THAT THERE IS VERY GOOD REASON (IN THE ABSENCE OF SPECIAL CIRCUMSTANCES LEADING TO AN OPPOSITE CONCLUSION) FOR TREATING SUCH AN EXPENDITURE AS PRO PERLY ATTRIBUTABLE NOT TO REVENUE BUT TO CAPITAL'.' (P. 10) 5. THIS TEST, AS THE PARENTHETICAL CLAUSE SHOWS, MUST YIELD WHERE THERE ARE SPECIAL CIRCUMSTANCES LEADING TO A CONTRARY CONCLUSION. BRI EFLY PUT, IT IS NOT A STRAIT- JACKET FORMULA AND THE QUESTION WILL HAVE TO BE DET ERMINED IN THE BACKDROP OF FACTS OF EACH CASE. THE TEST LAID DOWN CAN AT BEST BE A GUIDE FOR DETERMINING WHETHER A PARTICULAR EXPENDITURE FORMS PART OF REVE NUE EXPENDITURE OR CAPITAL EXPENDITURE. THE MADRAS HIGH COURT IN KISENCHAND CHELLARAM ( INDIA )( P. ) LTD.'S CASE ( SUPRA ) WAS DEALING WITH A CASE IN WHICH THE ASSESSEE HAD PAID FEES FOR RAISING THE CAPITAL OF A COMPANY TO THE REGISTRAR OF COMPANIES AND HAD CLAIMED THE AMOUNT PAID AS A REVE NUE EXPENDITURE. IT WAS HELD THAT WITHOUT CAPITAL A COMPANY CANNOT CARRY ON ITS BUSINESS AND HENCE, THE EXPENSES INCURRED FOR INCREASING THE CAPITAL WERE B OUND UP WITH THE FUNCTIONING AND FINANCING OF THE BUSINESS. THEREFORE, THE ASSES SEE'S CLAIM FOR DEDUCTION WAS ALLOWED. THE VIEW TAKEN WAS THAT SINCE THE AMOUNT W AS WHOLLY AND EXCLUSIVELY USED FOR THE PURPOSE OF THE ASSESSEE'S BUSINESS, IT WAS ALLOWABLE AS A DEDUCTION UNDER SECTION 37(1) OF THE ACT. THE KARNATAKA HIGH COURT HAS FOLLOWED THE VIEW TAKEN BY THE MADRAS HIGH COURT AND SO ALSO HAS THE KERALA HIGH COURT TAKEN THE SAME VIEW. AFTER CONSIDERING THE TEST LAID DOWN BY THIS COURT IN EMPIRE JUTE CO. LTD.'S CASE ( SUPRA ) , THE KERALA HIGH COURT OBSERVED IN THE CASE OF FEDERAL BANK LTD. ( SUPRA ): '...WE ARE OF THE VIEW THAT THE EXPENDITURE INCURRE D FOR THE ENHANCEMENT OF AUTHORISED CAPITAL IS ONLY FOR THE P URPOSE OF BETTERING 5 ITA NO. 1342/JP/2018 M/S. SHIVGYAN DEVELOPERS LTD., JAIPUR. OR IMPROVING AN ESTABLISHED BUSINESS AND CANNOT BE SAID TO BE FOR THE PURPOSE OF A NEW BUSINESS. VIEWED IN A BUSINESS SEN SE, THE ENHANCEMENT OF THE AUTHORISED CAPITAL IS ONLY TO BR OADEN THE CAPITAL BASE WHICH WILL BE CONDUCIVE TO THE BETTER CONDUCT AND EFFICIENCY AND PROFITABILITY OF THE BUSINESS.' (P. 246) 6. IN THIS VIEW THE HIGH COURT HELD THAT THE EXPENDIT URE INCURRED BY THE ASSESSEE WAS AN ITEM OF REVENUE EXPENDITURE. THIS L INE OF REASONING HAS NOT FOUND FAVOUR WITH THE OTHER HIGH COURTS WHICH HAVE TAKEN A CONTRARY VIEW. THE CALCUTTA HIGH COURT IN BROOKE BOND INDIA LTD.'S CASE ( SUPRA ) HELD THAT WHERE THE OBJECT OF INCURRING AN EXPENDITURE IS TO AFFECT THE CAPITAL STRUCTURE AS A RESULT OF WHICH CERTAIN INCIDENTAL ADVANTAGE FLOW S, THE EXPENDITURE WILL BE OF CAPITAL NATURE. IT IS NOT THE ACQUISITION OF A RIGH T OF A PERMANENT CHARACTER ALONE, THE CREATION OF WHICH IS A CONDITION FOR THE CARRYING ON OF THE BUSINESS, THAT COULD BE RIGHTLY TREATED AS AN EXPENDITURE ON THE CAPITAL ACCOUNT. CAPITAL EXPENDITURE CAN BE INCURRED AFTER A COMPANY IS FLOA TED OR IT STARTED BUSINESS, IF IT RESULTED IN BRINGING ABOUT CAPITAL ADVANTAGE. TH E ANDHRA PRADESH HIGH COURT HAD IN WARNER HINDUSTAN LTD.'S CASE ( SUPRA ) , FOLLOWING THE DECISION OF THE MADRAS HIGH COURT IN KISENCHAND CHELLARAM ( INDIA )( P. ) LTD.'S CASE ( SUPRA ) , HELD THAT THE EXPENDITURE INCURRED WAS CONNECTED WI TH THE FUNCTIONING AND FINANCING OF THE ASSESSEE'S BUSINES S AND, HENCE, THE FEES PAID COULD NOT BE TREATED AS ON CAPITAL ACCOUNT. HOWEVER , THIS LINE OF REASONING WAS DEPARTED FROM IN THE SUBSEQUENT DECISION IN VAZIR SULTAN TOBACCO CO. LTD.'S CASE ( SUPRA ) , WHEREIN IT WAS OBSERVED THAT WHERE THE OBJECT OF IN CURRING AN EXPENDITURE IS TO AFFECT A CAPITAL STRUCTURE AS A RESULT OF WHICH CERTAIN INCIDENTAL ADVANTAGE FLOWS, THE EXPENDITURE WILL BE OF CAPITAL NATURE. IN OTHER WORDS, IT FOLLOWED THE DECISION OF THE CALCUTTA HIG H COURT REFERRED TO EARLIER. IT DISTINGUISHED THE EARLIER DECISION IN WARNER HINDUSTAN LTD.'S CASE ( SUPRA )HOLDING THAT IT WAS UNABLE TO APPRECIATE THE REASO NING OF THE MADRAS HIGH COURT WHICH HELD IT TO BE A REVENUE EXPENDITUR E. IT, THEREFORE, REFUSED TO EXTEND THE RATIO OF THE DECISION IN THE EARLIER CAS E OF WARNER HINDUSTAN LTD. ( SUPRA )TO EXPENSES INCURRED DIRECTLY FOR THE PURPOSE. THE GUJARAT HIGH COURT IN AHMEDABAD MFG. & CALICO ( P. ) LTD.'S CASE ( SUPRA ) HELD THAT THE EXPENDITURE INCURRED BEING FOR AN ENDURING BENEFIT IN THE COMMERCIAL SENSE COULD FALL IN THE CAPITAL FIELD. IT WAS HELD THAT T HE SHARES ISSUED BY THE COMPANY CONSTITUTED ITS CAPITAL AND BEING AN INTEGRAL PART OF THE PERMANENT STRUCTURE OF THE COMPANY FELL WITHIN THE REALM OF CAPITAL EXPEND ITURE. THIS VIEW WAS REITERATED IN THE SUBSEQUENT CASE OF ALEMBIC GLASS INDUSTRIES LTD. ( SUPRA ) . THE BOMBAY HIGH COURT IN BOMBAY BURMAH TRADING CORPN. LTD..'S CASE ( SUPRA ) , WHILE DEALING WITH THE QUESTION WHETHER THE FEES PA ID TO THE REGISTRAR OF COMPANIES FOR ENHANCEMENT OF CAPIT AL COULD BE DESCRIBED AS REVENUE EXPENDITURE OR CAPITAL EXPENDITURE, DIFFERE D WITH A VIEW TAKEN BY THE MADRAS HIGH COURT AND HELD THAT IT RUNS COUNTER TO THE DECISION OF THIS COURT IN INDIA CEMENTS LTD. V. CIT [1966] 60 ITR 52 AND TATA IRON & STEEL CO. LTD., IN RE [1921] 1 ITC 125 (BOM.) , WHEREIN IT WAS EXPRESSLY POINTED OUT THAT THE EXPENDITURE INCURRED FOR THE ISSUE OF PREFERENCE SH ARES COULD NOT BE SAID TO BE SOLELY INCURRED FOR THE PURPOSES OF THE COMPANY'S B USINESS. BRIEFLY PUT, IT WAS HELD THAT IT WAS AN EXPENDITURE INCURRED DIRECTLY F OR THE PURPOSES OF EXPANSION OF THE CAPITAL ASSET AND WAS, THEREFORE, OF CAPITAL NATURE. 6 ITA NO. 1342/JP/2018 M/S. SHIVGYAN DEVELOPERS LTD., JAIPUR. 7. WE DO NOT CONSIDER IT NECESSARY TO EXAMINE ALL THE DECISIONS IN EXTENSO BECAUSE WE ARE OF THE OPINION THAT THE FEE PAID TO THE REGISTRAR FOR EXPANSION OF THE CAPITAL BASE OF THE COMPANY WAS DI RECTLY RELATED TO THE CAPITAL EXPENDITURE INCURRED BY THE COMPANY AND ALTHOUGH IN CIDENTALLY THAT WOULD CERTAINLY HELP IN THE BUSINESS OF THE COMPANY AND M AY ALSO HELP IN PROFIT- MAKING, IT STILL RETAINS THE CHARACTER OF A CAPITAL EXPENDITURE SINCE THE EXPENDITURE WAS DIRECTLY RELATED TO THE EXPANSION O F THE CAPITAL BASE OF THE COMPANY. WE ARE, THEREFORE, OF THE OPINION THAT THE VIEW TAKEN BY THE DIFFERENT HIGH COURTS IN FAVOUR OF THE REVENUE IN THIS BEHALF IS THE PREFERABLE VIEW AS COMPARED TO THE VIEW BASED ON THE DECISION OF THE M ADRAS HIGH COURT IN KISENCHAND CHELLARAM ( INDIA ) ( P. ) LTD.'S CASE ( SUPRA ) . WE, THEREFORE, ANSWER THE QUESTION RAISED FOR OUR DETERMINATION IN THE AFFIRMATIVE, I.E., IN FAVOUR OF THE REVENUE AND AGAINST THE ASSESSEE. IN VIEW OF THE DECISION OF HONBLE SUPREME COURT AS RELIED UPON BY THE LD. D/R, WE FIND THAT ONCE THE ASSESSEE HAS NOT CLAIMED THAT AF TER INCREASE IN AUTHORIZED CAPITAL, THE ASSESSEE IS CONTEMPLATING INCREASE IN THE PAID UP CAPITAL OF THE COMPANY FOR THE PURPOSE OF MEETING THE EXPENDITURE ON WORKING CAPIT AL, THE SAID EXPENDITURE INCURRED TOWARDS THE INCREASE OF AUTHORIZED CAPITAL AND NOT SUBSEQUENT INCREASE IN THE PAID UP CAPITAL TO BE USED FOR WORKING CAPITAL, IT CERTAINLY A CAPITAL EXPENDITURE AND NOT A REVENUE EXPENDITURE. ACCORDINGLY, IN VIEW OF THE BINDING PRECEDENTS, WE DO NOT FIND ANY REASON TO INTERFERE WITH THE ORDERS OF THE AUTHORITIES BELOW QUA THIS ISSUE. GROUND NO. 3 IS REGARDING NOT ALLOWING THE TDS CRED ITS IN RESPECT OF RENTAL INCOME WHICH WAS WRONGLY CREDITED IN THE ACC OUNT OF THE ASSESSEE INSTEAD OF THE NEW OWNERS OF THE PROPERTIES TO WHOM THE ASSESSEE SOLD THE LET OUT PROPERTIES. 7. THE LD. A/R OF THE ASSESSEE HAS SUBMITTED THAT T HE ASSESSEE WAS OWNER OF CERTAIN COMMERCIAL PROPERTIES WHICH WERE LET OUT TO DIFFERENT ENTITIES. HOWEVER, DURING THE YEAR UNDER CONSIDERATION THOSE PROPERTIE S WERE SOLD BY THE ASSESSEE BUT THE TENANTS HAVE WRONGLY DEDUCTED THE TDS IN THE NA ME OF THE ASSESSEE COMPANY. HE HAS POINTED OUT THAT THE ASSESSEE COMPANY HAS TR ANSFERRED THE WHOLE RENT 7 ITA NO. 1342/JP/2018 M/S. SHIVGYAN DEVELOPERS LTD., JAIPUR. RECEIVED FROM THE TENANTS TO THE PURCHASERS SMT. VI MLA DEVI AND SMT. URMILA DEVI WHO HAVE SHOWN THE RENTAL INCOME IN THEIR RETURNS O F INCOME. IN SUPPORT OF HIS CONTENTION, HE HAS REFERRED TO THE RETURNS OF INCOM E FILED BY SMT. VIMLA DEVI AND SMT. URMILA DEVI. THE LD. A/R HAS FURTHER SUBMITTE D THAT THE ASSESSEE COMPANY HAS REIMBURSED THE TDS TO THE BUYERS OF THE PROPERTIES AND, THEREFORE, THE TDS CREDIT WHICH HAS BEEN GIVEN TO THE BUYERS OF THE PROPERTIE S BY THE COMPANY SHOULD BE ALLOWED TO THE ASSESSEE COMPANY. 8. ON THE OTHER HAND, THE LD. D/R HAS SUBMITTED THA T THE ASSESSEE HAS NOT DECLARED THE RENTAL INCOME AS ITS INCOME AND, THERE FORE, EVEN IF THE TENANTS HAVE WRONGLY CREDITED THE TDS IN THE ACCOUNT OF THE ASSE SSEE, THE ASSESSEE IS NOT ELIGIBLE FOR CREDIT OF THE SAID TDS WHEN THE CORRESPONDING I NCOME WAS NOT OFFERED TO TAX BY THE ASSESSEE. SHE HAS RELIED UPON THE ORDERS OF TH E AUTHORITIES BELOW. 9. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AS WELL AS THE RELEVANT MATERIAL ON RECORD. THE ASSESSEE HAS SOLD THREE COMMERCIAL PRO PERTIES DURING THE YEAR UNDER CONSIDERATION, ALL OF THEM WERE LET OUT TO DIFFEREN T ENTITIES. THE DETAILS OF THE PROPERTY RENT AND THE PURCHASERS ARE AS UNDER :- NAME OF THE ENTITY PREMISES RENTED OUT RENT PER ANNUM PROPERTY SOLD DURING THE YEAR TO WHOM BHARTI RETAILS LTD. COMMERCIAL SPACE GROUND FLOOR A BLOCK, 3031 SQFT. 1202040 SMT. VIMLA DEVI STATE BANK OF BIKANER AND JAIPUR. COMMERCIAL SPACE AT GROUND FLOOR B BLOCK 2038.24 SQFT. 953136 SMT. URMILA DEVI ICICI BANK LTD. COMMERCIAL SPACE AT GROUND FLOOR B BLOCK 2038.23 SQFT. 856758 SMT. URMILA DEVI THE ASSESSEE HAS NOT DISPUTED THE FACT THAT THE REN TAL INCOME WAS NOT SHOWN AS INCOME OF THE ASSESSEE BUT IT IS CLAIMED THAT THE S AME WAS SHOWN AS INCOME BY THE 8 ITA NO. 1342/JP/2018 M/S. SHIVGYAN DEVELOPERS LTD., JAIPUR. PURCHASERS OF THESE PROPERTIES. THE ASSESSEE CLAIM ED THE TDS CREDIT IN RESPECT OF THE AMOUNT WHICH WAS DEDUCTED BY THE TENANTS AND DE POSITED IN THE PAN OF THE ASSESSEE. IN VIEW OF THE UNDISPUTED FACT THAT NEIT HER THE RENTAL INCOME NOR THE TDS BELONGS TO THE ASSESSEE, THEREFORE, THE ASSESSEE HA S NO RIGHT TO CLAIM THE TDS CREDIT WHICH WAS WRONGLY DEPOSITED IN THE ACCOUNT OF THE A SSESSEE. THE APPROPRIATE REMEDY WOULD BE THE FILING OF THE RECTIFICATION STA TEMENT AS PER THE PROVISO TO SECTION 200 OF THE IT ACT BY THE TENANTS AND CONSEQ UENTLY THE TDS CREDIT WOULD BE AVAILABLE TO THE CURRENT OWNERS WHO HAVE OFFERED TH E RENTAL INCOME TO TAX. ACCORDINGLY, WE DO NOT FIND ANY SUBSTANCE OR MERIT IN THE GROUND RAISED BY THE ASSESSEE. 10. IN THE RESULT, APPEAL OF THE ASSESSEE IS DISMIS SED. ORDER IS PRONOUNCED IN THE OPEN COURT ON 20/08/2 019. SD/- SD/- ( JES'K LH- 'KEKZ ) ( FOT; IKY JKWO (RAMESH C. SHARMA ) (VIJAY PAL RAO) YS[KK LNL;@ ACCOUNTANT MEMBER U;KF;D LNL;@ JUDICIAL MEMBER JAIPUR DATED:- 20/08/2019. DAS/ VKNS'K DH IZFRFYFI VXZSF'KR@ COPY OF THE ORDER FORWARDED TO: 1. THE APPELLANT- M/S. SHIVGYAN DEVELOPERS LTD., J AIPUR. 2. THE RESPONDENT THE ITO, WARD 6(1), JAIPUR. 3. THE CIT(A). 4. THE CIT, 5. THE DR, ITAT, JAIPUR 6. GUARD FILE (ITA NO. 1342/JP/2018) VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASSISTANT. REGISTRAR