Zelan Projects Pvt. Ltd., Hyderabad V. Dy. Commissioner of Income Tax, Hyderabad

ITA 1361/HYD/2013

• Counselvise Citation: 136122514 RSA 2013
• Duration Of Justice: 1 year(s) 3 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-01-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 12-01-2015
• Assessment Year: 2006-2007
• Appeal Filed On: 10-10-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: G APARNA RAO
• Assessee Lawyers: P MURALI MOHAN RAO
• Keywords: Depreciation; Wrong claim
• Section: 6; 263; 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES A : HYDERABAD BEFORE SHRI P. M. JAGTAP, ACCOUNTANT MEMBER AND SMT. ASHA VIJAYARAGHAVAN, JUDICIAL MEMBER ITA.NO.1361/HYD/2013 ASSESSMENT YEAR 2006-2007 M/S. ZELAN PROJECTS P. LTD., HYDERABAD. PAN AAACZ2295B VS. DCIT, CIRCLE 3(3) HYDERABAD (APPELLANT) (RESPONDENT) FOR ASSESSEE : MR. P. MURALIMOHAN RAO FOR REVENUE : SMT. G. APARNA RAO DATE OF HEARING : 12.01.2015 DATE OF PRONOUNCEMENT : 12.01.2015 ORDER PER P.M. JAGTAP, A.M. THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE LEARNED CIT-III, HYDERABAD DATED 26 TH MARCH, 2013 WHEREBY HE DIRECTED THE A.O. TO WITHDRA W THE CREDIT ALLOWED BY HIM FOR TAX DEDUCTED AT SOURCE FR OM THE AMOUNT RECEIVED BY THE ASSESSEE TOWARDS MOBILIZATIO N ADVANCE DURING THE YEAR UNDER CONSIDERATION. 2. THE ASSESSEE IN THE PRESENT CASE IS A COMPANY WHICH IS ENGAGED IN THE BUSINESS OF PROCUREMENT OF ERECTION CONTRACTS FOR 200-300 MW THERMAL POWER STATION AND SUB- CONTRACT THE SAME TO OTHER CONTRACTORS. THE RETURN OF INCOME FOR THE YEAR UNDER CONSIDERATION WAS FILED BY IT ON 13.11.2006 DECLARING A LOSS OF RS.65,48,374. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE A.O. FOUND THAT THE ASS ESSEE HAS 2 ITA.NO.1361/HYD/2013 M/S. ZELAN PROJECTS P. LTD., HYDERABAD. RECEIVED MOBILIZATION ADVANCE OF RS.14.49 CRORES AG AINST THE CONTRACT PROCURED BY IT FROM LANCO AMARKANTAK POWER P. LTD., (IN SHORT LAPPL) FOR SETTING-UP OF ITS 300 MW THE RMAL POWER STATION. THE SAID ADVANCE WAS SHOWN BY THE ASSESSEE AS ITS LIABILITY IN THE BALANCE SHEET AND A TOTAL SUM OF R S.16.22 CRORES PAID TO THE SUB-CONTRACTORS FOR THE EXECUTIO N OF THE CONTRACT RECEIVED FROM LAPPL WAS SHOWN AS WORK-IN-P ROGRESS. NO INCOME FROM THE SAID PROJECT, HOWEVER, WAS RECOG NISED OR DECLARED BY THE ASSESSEE FOR THE YEAR UNDER CONSIDE RATION. WHILE MAKING THE PAYMENT OF MOBILIZATION ADVANCE TO THE ASSESSEE, TAX AT SOURCE WAS DEDUCTED BY LAPPL UNDER SECTION 194J TREATING THE SAME AS FEES PAID FOR PROFESSIONA L AND TECHNICAL SERVICES. WHILE EXPLAINING ITS STAND OF N OT RECOGNIZING ANY INCOME FROM THE CONTRACT PROCURED FROM LAPPL, I T WAS SUBMITTED BY THE ASSESSEE BEFORE THE A.O. THAT THE SAID CONTRACT WAS NOT FULLY EXECUTED DURING THE YEAR UND ER CONSIDERATION AND SINCE NO BILL WAS RAISED ON THE S AID PARTY, NO INCOME WAS RECOGNISED AND THE EXPENDITURE INCURR ED ON PAYMENT MADE TO SUB-CONTRACTORS WAS SHOWN AS WORK I N PROGRESS. THIS EXPLANATION OF THE ASSESSEE WAS NOT FOUND ACCEPTABLE BY THE A.O. ACCORDING TO HIM, THE ASSESS EE SHOULD HAVE RECOGNISE THE REVENUE ON YEAR-TO-YEAR BASIS DE SPITE THE FACT THAT THE WORK WAS NOT COMPLETED AND BY NOT DOI NG SO, THE RECOGNITION OF PROFIT WAS POSTPONED BY THE ASSESSEE WHICH IS NOT PERMISSIBLE. HE, THEREFORE, ESTIMATED THE INCOM E OF THE ASSESSEE FROM THE SAID CONTRACT AT RS.1.29 CRORES B Y APPLYING THE NET PROFIT RATE OF 8% TO THE TOTAL EXPENDITURE OF RS.16.22 CRORES AND BROUGHT TO TAX THE SAME IN THE HANDS OF THE ASSESSEE FOR THE YEAR UNDER CONSIDERATION IN THE AS SESSMENT ORIGINALLY COMPLETED UNDER SECTION 143(3) VIDE ORDE R DATED 12.10.2008. 3 ITA.NO.1361/HYD/2013 M/S. ZELAN PROJECTS P. LTD., HYDERABAD. 3. AGAINST THE ORDER PASSED BY THE A.O. UNDER SECTION 143(3), AN APPEAL WAS PREFERRED BY THE ASSE SSEE BEFORE THE LD. CIT AND AFTER CONSIDERING THE SUBMISSIONS M ADE BY THE ASSESSEE AS WELL AS THE MATERIAL AVAILABLE ON RECOR D, THE LD. CIT, GUNTUR DELETED THE ADDITION MADE BY THE A.O. O N ACCOUNT OF ESTIMATED INCOME FROM THE CONTRACT OF LAPPL HOLD ING THAT NO SUCH INCOME COULD BE ESTIMATED IN RESPECT OF THE AMOUNT RECEIVED BY THE ASSESSEE TOWARDS MOBILIZATION ADVAN CE. THE A.O. ACCORDINGLY, PASSED A CONSEQUENTIAL ORDER ON 1 0.05.2012 GIVING EFFECT TO THE APPELLATE ORDER OF THE LEARNED CIT WHEREBY, HE DELETED THE ADDITION OF RS.1.29 CRORES MADE TO T HE TOTAL INCOME OF THE ASSESSEE ON ACCOUNT OF ESTIMATED INCO ME FROM THE CONTRACT OF LAPPL BUT ALLOWED THE CREDIT FOR TD S MADE BY LAPPL FROM THE PAYMENT OF MOBILIZATION ADVANCE AS W AS DONE IN THE ORDER ORIGINALLY PASSED UNDER SECTION 143(3) . 4. ON EXAMINATION OF THE ORDER PASSED BY THE A.O. DATED 10.05.2012 GIVING EFFECT TO THE ORDER OF THE LD. CIT(A), THE LD. CIT WAS OF THE OPINION THAT THE SAME WAS ER RONEOUS AS WELL AS PREJUDICIAL TO THE INTEREST OF THE REVENUE, INTER ALIA , ON THE ISSUE OF GIVING CREDIT FOR THE TDS MADE BY LAPP L FROM THE PAYMENT MADE ON ACCOUNT OF MOBILIZATION ADVANCE SIN CE THE AMOUNT OF MOBILIZATION ADVANCE WAS NOT CHARGEABLE T O TAX IN THE HANDS OF THE ASSESSEE AS INCOME IN THE YEAR UND ER CONSIDERATION AS HELD BY THE LD. CIT(A). HE, THERE FORE, ISSUED A NOTICE UNDER SECTION 263 REQUIRING THE ASSESSEE TO EXPLAIN AS TO WHY THE ORDER PASSED BY THE A.O. UNDER SECTION 1 43(3) SHOULD NOT BE REVISED UNDER SECTION 263 WITHDRAWING THE CREDIT ALLOWED FOR THE TDS. IN REPLY, IT WAS SUBMIT TED BY THE ASSESSEE THAT THERE WAS NO ERROR IN THE ORDER OF TH E A.O. IN GIVING CREDIT FOR THE TDS MADE BY LAPPL FROM THE PA YMENT OF 4 ITA.NO.1361/HYD/2013 M/S. ZELAN PROJECTS P. LTD., HYDERABAD. MOBILIZATION ADVANCE MADE DURING THE YEAR UNDER CONSIDERATION. IT WAS ALSO SUBMITTED THAT GIVING SU CH CREDIT FOR TDS, IN ANY CASE, DID NOT CAUSE ANY PREJUDICE TO TH E INTERESTS OF THE REVENUE AS THE ISSUE INVOLVED WAS LIMITED AS TO WHICH YEAR THE CREDIT FOR TDS SHOULD BE GIVEN. THE LD. CI T DID NOT FIND MERIT IN THE SUBMISSIONS MADE ON BEHALF OF THE ASSESSEE. ACCORDING TO HIM, AS PER THE PROVISIONS OF SECTION 199 AS APPLICABLE TO THE YEAR UNDER CONSIDERATION, CREDIT FOR TDS WAS LIABLE TO BE GIVEN ONLY IN RESPECT OF THE INCOME WH ICH WAS ASSESSABLE TO TAX IN THE RELEVANT ASSESSMENT YEAR. HE HELD THAT SINCE THE AMOUNT OF MOBILIZATION ADVANCE RECEIVED B Y THE ASSESSEE WAS NOT CHARGEABLE TO TAX IN ITS HANDS FOR THE YEAR UNDER CONSIDERATION AS HELD BY THE LD. CIT(A), THE CREDIT ALLOWED BY THE A.O. FOR TDS MADE FROM THE MOBILIZAT ION ADVANCE WAS IN VIOLATION OF PROVISIONS OF SECTION 1 99. HE ALSO HELD THAT AS EACH ASSESSMENT YEAR IS TO BE CONSIDER ED INDEPENDENTLY, THE WRONG CLAIM ALLOWED BY THE A.O. FOR CREDIT OF TDS FOR THE YEAR UNDER CONSIDERATION WAS CERTAIN LY PREJUDICIAL TO THE INTERESTS OF THE REVENUE. HE, TH EREFORE, SET ASIDE THE ORDER PASSED BY THE A.O. ON THIS ISSUE WI TH A DIRECTION TO PASS THE ORDER AFRESH WITHDRAWING THE CREDIT ALLOWED FOR TDS. AGGRIEVED BY THE ORDER OF THE LD. CIT PASSED UNDER SECTION 263, THE ASSESSEE HAS PREFERRED THE P RESENT APPEAL BEFORE THE TRIBUNAL. 5. WE HAVE HEARD THE ARGUMENTS OF BOTH THE PARTIES AND ALSO PERUSED THE RELEVANT MATERIAL ON RECORD. 6. THE LD. COUNSEL FOR THE ASSESSEE HAS SUBMITTED THAT THE ISSUE RELATING TO THE GRANT OF TDS MADE FR OM THE MOBILIZATION ADVANCE FOR THE RELEVANT YEAR IN WHICH SUCH ADVANCE IS NOT CHARGEABLE TO TAX, AS INVOLVED IN TH E PRESENT 5 ITA.NO.1361/HYD/2013 M/S. ZELAN PROJECTS P. LTD., HYDERABAD. CASE, IS SQUARELY COVERED IN FAVOUR OF THE ASSESSEE ON MERITS BY THE DECISION OF THE COORDINATE BENCH OF THIS TRIBUN AL IN THE CASE OF ACIT VS. PEDDI SRINIVASA RAO WAS DIRECTED V IDE ITS ORDER DATED 03.03.2011 IN ITA.NO.324/VIZAG/2009. HE HAS A LSO PLACED ON RECORD A COPY OF THE SAID ORDER AND PERUS AL OF THE SAME SHOWS THAT SIMILAR ISSUE HAS BEEN DECIDED BY T HE TRIBUNAL IN FAVOUR OF THE ASSESSEE VIDE PARA 7 TO 1 0 OF ITS ORDER WHICH READ AS UNDER : 7. HAVING HEARD THE RIVAL SUBMISSIONS AND FROM A CAREFUL PERUSAL OF THE ORDERS OF THE AUTHORITIES BE LOW AND DOCUMENTS PLACED ON RECORD IN THE LIGHT OF ALL RELE VANT PROVISIONS OF THE ACT, WE FIND THAT UNDISPUTEDLY, T HE ASSESSEE HAS RECEIVED THE MOBILIZATION AMOUNT WHICH IS TO BE ADJUSTED AGAINST SUBCONTRACT BILLS RAISED IN SUB SEQUENT YEARS. IT IS ALSO EVIDENT FROM THE RECORD THAT ON T HIS MOBILIZATION AMOUNT, ASSESSEE WAS REQUIRED TO PAY T HE INTEREST. THEREFORE, ONCE THE ENTIRE MOBILIZATION A MOUNT IS NOT AN INCOME OF THE ASSESSEE, TDS SHOULD NOT HAVE BEEN DEDUCTED BY THE PAYER. BUT IN ANY CASE, THE TDS WAS DEDUCTED ON THIS PAYMENT OF MOBILIZATION AMOUNT THO UGH IT WAS NOT AN INCOME IN THE HANDS OF THE ASSESSEE ON I TS RECEIPT. BUT SUBSEQUENTLY, WHENEVER IT IS TO BE ADJ USTED IN THE SUB-CONTRACT BILLS TO BE RAISED IN THE SUBSEQUE NT YEARS, IT WOULD GRADUALLY PARTAKE THE CHARACTER OF THE INC OME OF THE ASSESSEES. NOW THE QUESTION ARISE, ONCE THE TDS WAS DEDUCTED ON THE RECEIPT, HOW THE CREDIT OF THE SAME IS TO BE ALLOWED TO THE ASSESSEES ? 8. WE HAVE CAREFULLY PERUSED THE PROVISIONS OF SEC TION 199 OF THE ACT AND ACCORDING TO THE PRE-AMENDED PRO VISIONS OF SECTION 199, THE CREDIT OF DEDUCTION MADE IN ACC ORDANCE WITH THE RELEVANT PROVISIONS OF THIS CHAPTER AND PA ID TO THE CENTRAL GOVERNMENT, SHALL BE GIVEN FOR THE AMOUNT S O DEDUCTED ON THE PRODUCTION OF THE CERTIFICATE FURNI SHED U/S 203 FOR THE ASSESSMENT MADE UNDER THIS ACT FOR THE ASSESSMENT YEAR FOR WHICH SUCH INCOME IS ASSESSABLE . BUT IN THE AMENDED PROVISIONS THE WORDS FOR THE ASSESS MENT YEAR FOR WHICH SUCH INCOME IS ASSESSABLE HAS BEEN OMITTED. MEANING THEREBY, THAT THE LEGISLATURE WAS QUITE CONSCIOUS ABOUT THE FACTS AND HARDSHIPS FACED BY SO ME ASSESSEES, WHILE MAKING THE AMENDMENTS IN SECTION 1 99 6 ITA.NO.1361/HYD/2013 M/S. ZELAN PROJECTS P. LTD., HYDERABAD. AND IN AMENDED PROVISIONS NOTHING HAS BEEN STATED A BOUT THE YEAR IN WHICH THE CREDIT OF TDS IS TO BE CLAIME D. AS PER AMENDED PROVISIONS OF SECTION 199, IN SUB-SECTION 1 , IT HAS BEEN STATED THAT ANY DEDUCTIONS MADE IN ACCORDANCE WITH THE FOREGOING PROVISIONS OF THIS CHAPTER AND PAID T O THE CENTRAL GOVERNMENT SHALL BE TREATED AS A PAYMENT OF TAX ON BEHALF OF THE PERSON FROM WHOSE INCOME THE DEDUC TION WAS MADE. THEREFORE, AS PER THE AMENDED PROVISIONS, ONCE THE TDS WAS DEDUCTED, A CREDIT OF THE SAME TO BE GI VEN TO THE ASSESSEES, IRRESPECTIVE OF THE YEAR TO WHICH IT RELATES. THE PRE-AMENDED AND THE AMENDED PROVISIONS OF SECTI ON 199 ARE EXTRACTED HEREUNDER: SECTION 199 : CREDIT FOR TAX DEDUCTED (1) ANY DEDUCTION MADE IN ACCORDANCE WITH THE FOREGOING PROVISIONS OF THIS CHAPTER AND PAID TO THE CENTRAL GOVERNMENT SHALL BE TREATED AS A PAYMENT OF TAX ON BEHALF OF THE PERSON FROM WHOSE INCOME THE DEDUCTIO N WAS MADE, OR OF THE OWNER OF THE SECURITY, OR DEPOS ITOR OR OWNER OF PROPERTY OR OF UNIT-HOLDER OR OF THE SHARE HOLDER, AS THE CASE MAY BE, AND CREDIT SHALL BE GIVEN TO HI M FOR THE AMOUNT SO DEDUCTED ON THE PRODUCTION OF THE CERTIFICATE FURNISHED UNDER SECTION 203 IN THE ASSESSMENT MADE UNDER THIS ACT FOR THE ASSESSMENT YEAR FOR WHICH SUCH INCOME IS ASSESSABLE: (3) THE BOARD MAY, FOR THE PURPOSES OF GIVING CREDI T IN RESPECT OF TAX DEDUCTED OR TAX PAID IN TERMS OF THE PROVISIONS OF THIS CHAPTER, MAKE SUCH RULES AS MAY BE NECESSARY, INCLUDING THE RULES FOR THE PURPOSES OF GIVING CREDIT TO A PERSON OTHER THAN THOSE REFERRED TO IN SUB- SECTION (1) AND SUB-SECTION (2) AND ALSO THE ASSESS MENT YEAR FOR WHICH SUCH CREDIT MAY BE GIVEN. SECTION 199. (1) ANY DEDUCTION MADE IN ACCORDANCE WITH THE FOREGOING PROVISIONS OF THIS CHAPTER AND P AID TO THE CENTRAL GOVERNMENT SHALL BE TREATED AS A PAYMEN T OF TAX ON BEHALF OF THE PERSON FROM WHOSE INCOME THE DEDUCTION WAS MADE, OR OF THE OWNER OF THE SECURITY , OR OF THE DEPOSITOR OR OF THE OWNER OF PROPERTY OR OF THE UNIT- HOLDER, OR OF THE SHAREHOLDER, AS THE CASE MAY BE. (2) ANY SUM REFERRED TO IN SUB-SECTION (1A) OF SECT ION 192 AND PAID TO THE CENTRAL GOVERNMENT SHALL BE TREATED AS THE TAX PAID ON BEHALF OF THE PERSON IN RESPECT OF WHOSE INCOME SUCH PAYMENT OF TAX HAS BEEN MADE. 7 ITA.NO.1361/HYD/2013 M/S. ZELAN PROJECTS P. LTD., HYDERABAD. 9. IN THE LIGHT OF THESE AMENDMENTS, WE HAVE ALSO EXAMINED THE JUDGMENT OF THIS HYDERABAD TRIBUNAL IN THE CASE OF PROGRESSIVE CONSTRUCTIONS LIMITED VS. JCIT ITA 482 AND 557/HYD/2001 AND THE ORDER OF THE TRIBUNAL OF CHENNAI BENCH IN THE CASE OF SUPREME RENEWABLE ENER GY LIMITED VS. ITO 32 DTR 140 AND TOYO ENGINEERING LIM ITED 5 SOT 616 IN WHICH THE TRIBUNAL HAS TAKEN A CONSIST ENT VIEW THAT THE CREDIT OF TDS SHOULD BE GIVEN IN THE YEAR OF RECEIPT. THE FACTS OF THE CASE OF M/S. PROGRESSIVE CONSTRUCTIONS LTD. (SUPRA) AND TOYO ENGINEERING IND IA LIMITED (SUPRA) ARE ALMOST SIMILAR TO THAT OF THE P RESENT CASE. IN THE CASE OF SUPREME RENEWABLE ENERGY LIMIT ED (SUPRA), THE TRIBUNAL HAS HELD THAT WHEN THE INTERE ST INCOME IS INCIDENTAL TO THE ACQUISITION AND INSTALL ATION OF AN ASSET AND IS NOT DIRECTLY LIABLE FOR TAX, ASSESS EE IS ENTITLED FOR THE CREDIT OF TDS FROM THE INTEREST IN COME WHICH HAS BEEN DULY RECEIVED BY THE GOVERNMENT. THE RELEVANT OBSERVATION OF THE TRIBUNAL ARE EXTRACTED HEREUNDER: THE DEPOSIT ON WHICH INTEREST WAS EARNED BY THE ASSESSEE IS MANDATORY AS PER STATUTORY REQUIREMENT. THEREFORE, THE INTEREST INCOME EARNED ON THE DEPOSI T IS NOT OUT OF SURPLUS FUND OF THE ASSESSEE BUT DUE TO THE STATUTORY REQUIREMENT UNDER WHICH THE DEPOSIT WAS MADE FOR AVAILING THE CREDIT FACILITY OF INSTALLATI ON OF MACHINERY. WHEN THE INTEREST INCOME IS IN THE NATUR E OF CAPITAL THEN THE ASSESSEE HAS RIGHTLY DEDUCTED THE SAME FROM THE COST OF THE ASSETS AND WHILE DOING SO THE ASSESSEE HAS OFFERED THE SAID INCOME THOUGH CAPITALIZED FOR ASSESSMENT. WHEN THE INTEREST INCOM E IS NOT DIRECTLY LIABLE FOR TAX AS THE SAME IS INCIDENT AL IN THE ACQUISITION AND INSTALLATION OF THE ASSET THEN THE TAX DEDUCTED AT SOURCE FROM THE INTEREST INCOME WHICH W AS DULY RECEIVED BY THE GOVERNMENT SHALL BE REFUNDED T O THE ASSESSEE OR THE ASSESSEE IS ENTITLED FOR THE CR EDIT OF THE SAME. THE GOVERNMENT CANNOT BENEFIT ITSELF BY TAKING ADVANTAGE OF LEGAL TECHNICALITIES. EVEN OTHERWISE, ONCE THE INCOME RECEIPT HAS BEEN DEDUCTE D FROM THE COST OF MACHINERY TO BE INSTALLED THE ASSE SSEE HAS INDIRECTLY OFFERED THE SAME FOR ASSESSMENT AND TAXATION BECAUSE DUE TO THE REDUCTION OF COST OF TH E MACHINERY AND DEPRECIATION ON THE SAID MACHINERY WOULD BE LESSER AND THE NET RESULT OF THIS WOULD BE OFFERING THE SAME INCOME OTHERWISE. WHEN A PARTICUL AR INCOME IS RECEIVED BY THE ASSESSEE AFTER DEDUCTION OF 8 ITA.NO.1361/HYD/2013 M/S. ZELAN PROJECTS P. LTD., HYDERABAD. TAX AT SOURCE AND THE SAID TDS HAS BEEN DULY DEPOSITED WITH THE GOVERNMENT AND THE ASSESSEE HAS RECEIVED THE REQUISITE CERTIFICATE TO THIS EFFECT, THEN ON PRODUCTION OF THE SAID CERTIFICATE THE ASSESSEE BEC OMES ENTITLED FOR THE CREDIT OF TDS EVEN IF THE ASSESSEE HAS NOT DIRECTLY OFFERED THE SAID INCOME FOR TAX AS THE ASSESSEE CONSIDERED THE SAME WAS NOT LIABLE TO TAX. WHEN THE ASSESSEE HAS EARNED INTEREST ON DEPOSIT MANDATORY FOR ACQUISITION ON INSTALLATION OF MACHIN ERY THEN THE INTEREST WAS EARNED BY THE ASSESSEE AND IS DIRECTLY INCIDENTAL TO THE ACQUISITION IN RESPECT O F MACHINERY AND THEREFORE THE SAME HAS BEEN RIGHTLY REDUCED FROM THE COST OF THE MACHINERY. IN THIS WAY THE ASSESSEE HAS INDIRECTLY DISCLOSED INCOME AND HAS OFFERED FOR ASSESSMENT. EVEN IF THE INCOME EARNED B Y THE ASSESSEE HAS NOT BEEN OFFERED FOR TAX BEING NOT LIABLE FOR TAX, THE ASSESSEE IS ENTITLED FOR CREDIT OF TDS MADE IN RESPECT OF THAT INCOME. ACCORDINGLY, ASSESS EE IS ENTITLED FOR CREDIT OF TDS RELATING TO INTEREST INCOME. 10. FROM A CAREFUL PERUSAL OF THE LEGAL PROPOSITION S LAID DOWN THROUGH THE AFORESAID ORDERS BY THE TRIBUNAL A ND THE RELEVANT PROVISIONS OF THE ACT, WE ARE OF THE V IEW THAT ONCE THE TDS WAS DEDUCTED AND PAID TO THE CENTRAL GOVERNMENT, A CREDIT OF THE SAME SHOULD BE GIVEN TO THE ASSESSEES IN ORDER TO AVOID ALL SORTS OF COMPLICATI ONS IN THE YEAR OF DEDUCTION OF THE TDS. THEREFORE, WE FIN D NO INFIRMITY IN THE ORDER OF THE CIT(A) WHO HAS RIGHTL Y DIRECTED THE A.O. TO ALLOW THE CREDIT OF THE TDS IN THE IMPU GNED ASSESSMENT YEAR. ACCORDINGLY, THE ORDER OF THE CIT( A) IS CONFIRMED. 6.1. IT IS MANIFEST FROM THE RELEVANT PORTION OF T HE TRIBUNALS ORDER AS REPRODUCED ABOVE THAT THE ISSUE INVOLVED IN THE PRESENT CASE IS SQUARELY COVERED IN FAVOUR O F THE ASSESSEE BY THE COORDINATE BENCHS ORDER ON MERIT WHEREBY, SIMILAR ISSUE INVOLVING IDENTICAL FACTS HAS BEEN DE CIDED BY THE TRIBUNAL IN FAVOUR OF THE ASSESSEE AFTER TAKING INT O CONSIDERATION ALL THE RELEVANT ASPECTS OF THE MATTE R INCLUDING THE PROVISIONS OF SECTION 199 AS APPLICABLE TO A.Y. 2006-2007. THE LEARNED D.R. HAS ALSO NOT BEEN ABLE TO DISPUTE THIS POSITION CLEARLY EVIDENT FROM THE ORDER OF THE TRIB UNAL, A COPY 9 ITA.NO.1361/HYD/2013 M/S. ZELAN PROJECTS P. LTD., HYDERABAD. OF WHICH IS PLACED ON RECORD BEFORE US. MOREOVER, T HE ORDER PASSED BY THE TRIBUNAL IN THE CASE OF MR. P. SRINIV ASA RAO (SUPRA) DECIDING A SIMILAR ISSUE ON MERIT IN FAVOUR OF THE ASSESSEE CLEARLY SHOWS THAT THE VIEW TAKEN BY THE A .O. WHILE ALLOWING CREDIT FOR THE TDS MADE FROM MOBILIZATION ADVANCE WAS A POSSIBLE VIEW AND THE LD. CIT, IN OUR OPINION , WAS NOT JUSTIFIED IN SUBSTITUTING HIS OWN VIEW FOR SUCH POS SIBLE VIEW TAKEN BY THE A.O. BY HIS IMPUGNED ORDER PASSED UNDE R SECTION 263 AS THE SAME IS NOT PERMISSIBLE UNDER THE PROVIS IONS OF SECTION 263 AS HELD INTER ALIA, BY THE HONBLE SUPR EME COURT IN THE CASE OF MALABAR INDUSTRIAL CO. LTD., VS. CIT 24 3 ITR 83. WE, THEREFORE, SET ASIDE THE IMPUGNED ORDER OF THE LD. CIT PASSED UNDER SECTION 263 AND ALLOW THE APPEAL OF TH E ASSESSEE. 7. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWE D. ORDER PRONOUNCED IN THE OPEN COURT ON 12.01.2015. SD/- SD/- (ASHA VIJAYARAGHAVAN) (P.M. JAGTAP) JUDICIAL MEMBER ACCOUNTANT MEMBER HYDERABAD, DATED 12 TH JANUARY, 2015 VBP/- COPY TO 1. M/S. ZELAN PROJECTS P. LTD., HYDERABAD C/O. P. MURALI & CO., C.AS. 6-3-655/2/3, 1 ST FLOOR, SOMAJIGUDA, HYDERABAD 82. 2. DCIT, CIRCLE 3(3), HYDERABAD 3. CIT-III, HYDERABAD. 4. ADDL. CIT, RANGE-3, HYDERABAD. 5. D.R. I.T.A.T. A BENCH, HYDERABAD.