Smt. Sunita Devi, New Delhi V. ACIT, New Delhi

ITA 4473/DEL/2012

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 96979 (ITAT-DELHI)
• Duration Of Justice: 3 year(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-08-2015
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: G
• Next Hearing Date: 17-08-2015
• Assessment Year: 2009-2010
• Appeal Filed On: 21-08-2012
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Assessee Lawyers: K C SINGHAL
• Keywords: Diversion of income
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH G, NEW DELHI BEFORE SH. H.S.SIDHU, JM AND SH. O.P.KANT, AM ITA NO.4473/DEL./2012 : A SSTT. YEAR : 2009-10 SUNITA DEVI BDA CO. B-104, UNESCO APARTMENT, PATPARGANJ NEW DELHI VS ACIT CIRCLE- 36(1) NEW DELHI (APPELLANT) (RESPONDENT) PAN NO. AGGPD8417J APPELLANT BY : SH. K.C.SINGHAL, ADV. RESPONDENT BY : SH. SUJIT KUMAR, SR. DR DATE OF HEARING : 17.08.2015 DATE OF PRONOUNCEMENT :21 .08.2015 ORDER PER O.P.KANT, A.M. THIS APPEAL HAS BEEN PREFERRED BY THE ASSESSEE AGAI NST THE ORDER DATED 11 TH MAY, 2012 OF THE COMMISSIONER OF INCOME TAX (APPEA LS)- XXVII, NEW DELHI FOR ASSESSMENT YEAR 2009-10. 2. THE GROUNDS OF APPEAL RAISED BY THE ASSESSEE A RE AS UNDER :- 1. THE LD. CIT(A) ERRED, ON FACTS AND IN LAW, IN N OT GRANTING CREDIT OF TAX DEDUCTED AT SOURCE U/S 199 OF THE I.T .ACT, 1961. 2. WITHOUT PREJUDICE TO GROUND NO. 1, THE CIT(A) W AS NOT JUSTIFIED IN NOT ISSUING DIRECTION TO ALLOW PROPORT IONATE CREDIT AGAINST THE TAX LIABILITY OF SH. KAPIL AHLUW ALIA WHO IS THE RECIPIENT OF BALANCE 50% OF INCOME. ITA NO.4473/DEL/2012 2 3. THE APPELLANT CRAVES TO ADD, OR AMEND THE GROUN D OF APPEALS IF REQUIRED AND NECESSARY. 3. THE FACTS IN BRIEF ARE THAT THE ASSESSEE IS AN INDIVIDUAL, ENGAGED IN RETAIL BUSINESS AND EARNED INCOME FROM FRANCHISE E / COMMISSION FROM M/S. ARVIND MILLS. THE ASSESSEE FILED RETURN OF INCOME ON 29.9.2009 DECLARING TOTAL INCOME OF RS. 1,19,89,080 /-. THE SCRUTINY ASSESSMENT OF THE CASE WAS COMPLETED ON 23 RD DECEMBER, 2011 U/S 143(3) OF THE INCOME TAX, 1961 (IN SHORT ACT). 4. DURING THE YEAR UNDER CONSIDERATION, THE ASS ESSEE RECEIVED COMMISSION OF RS. 2,61,18,048/- FROM M/S. ARVIND MI LL. HOWEVER, IN P&L A/C, THE ASSESSEE CREDITED ONLY RS. 1,53,18,47 8/- AS HER INCOME. PURSUANT TO THE QUERY RAISED BY THE ASSESSING OFFIC ER, IT WAS EXPLAINED BY THE ASSESSEE THAT THE BALANCE AMOUNT O F COMMISSION WAS TRANSFERRED BY THE ASSESSEE TO SHRI KAPIL AHLUWALIA I.E. THE STEP SON OF THE ASSESSEE, IN COMPLIANCE TO DIRECTION OF THE HIGH COURT GIVEN IN A DISPUTE BETWEEN THE ASSESSEE AND SH. KAPIL AHLUWA LIA. THE AMOUNT OF COMMISSION GIVEN TO SH. KAPIL AHLUWALIA WAS TREA TED BY THE ASSESSEE AS DIVERSION OF INCOME ON THE ACCOUNT OF O VERRIDING TITLE AND NOT AS APPLICATION OF INCOME, BY RELYING ON THE JUD GMENT IN THE CASE OF RAJA BIJOY SINGH DIDHURIA VS. CIT,1 ITR 135(PC) . THE ASSESSING OFFICER ACCEPTED THIS TREATMENT OF INCOME BY THE AS SESSEE, HOWEVER, REFERRING TO THE PROVISIONS OF SECTION 199 OF THE ACT, ALLOWED TDS CREDIT OF RS. 17,35,607/-, IN PROPORTION TO THE REC EIPT FROM ITA NO.4473/DEL/2012 3 COMMISSION CREDITED IN P&L ACCOUNT AND THE CREDIT F OR THE BALANCE AMOUNT OF TDS OF RS. 12,23,608/- WAS DENIED IN THE HANDS OF THE ASSESSEE, CONCURRENTLY HOLDING THAT AMOUNT OF COMMI SSION INCOME GIVEN TO SH. KAPIL AHLUWALIA WAS NEVER AN INCOME OF THE ASSESSEE. 5. AGGRIEVED, THE ASSESSEE FILED APPEAL BEFORE TH E COMMISSIONER OF INCOME-TAX (APPEALS) [ IN SHORT CIT(A)]. THE PLEA OF THE ASSESSEE TO ALLOW THE CREDIT OF ENTIRE TDS DEDUCTED WAS DECL INED BY THE CIT(APPEALS) INTER ALIA HOLDING THAT ALLOWING CREDI T FOR TDS ON PROPORTIONATE BASIS WAS RIGHTLY DONE BY THE AO AND THEREFORE HE AFFIRMED THE ACTION OF THE AO. THE ALTERNATIVE PLE A OF THE ASSESSEE TO ISSUE DIRECTION FOR ALLOWING THE CREDIT OF TDS IN THE HANDS OF SH. KAPIL AHLUWALIA, TO THE EXTENT IT WAS NOT ALLOWED IN THE HANDS OF THE ASSESSEE, WAS ALSO NOT ACCEPTED BY THE CIT(APPEALS) . IN PARA 12 OF HIS ORDER, THE CIT(APPEALS) HAS HELD THAT THE ASSES SEE HAS NOT FULFILLED THE CONDITIONS PROVIDED IN CLAUSE 2 OF RU LE 37 BA OF INCOME TAX RULES (IN SHORT RULES) NOR ANY DECLARATION W AS FILED BY THE APPELLANT WITH THE DEDUCTOR GIVING HIM PRESCRIBED D ETAILS OF SH. KAPIL AHLUWALIA AND THEREFORE HE DECLINED TO ISSUE ANY DI RECTION AS REQUESTED BY THE ASSESSEE. AGGRIEVED THE ASSESSEE I S BEFORE US. 6. THE LD. AUTHORISED REPRESENTATIVE (AR) ARGUED T HAT THE ASSESSEE WAS ENTITLED FOR CREDIT OF THE ENTIRE TDS AMOUNT AS PER THE PROVISIONS OF SECTION 199 OF THE ACT. FURTHER, HE SUBMITTED TH AT THE SUBRULE (2) OF RULE 37A OF INCOME TAX RULES WAS NOT APPLICABLE IN THE CASE OF ITA NO.4473/DEL/2012 4 THE ASSESSEE. FURTHER, IN HIS WRITTEN SUBMISSION, T HE AR PLEADED THAT CREDIT FOR WHOLE AMOUNT OF TDS IS ALLOWABLE EVEN IF THE AMOUNT ON WHICH TAX WAS DEDUCTED IS NOT CHARGEABLE IN THE HAN DS OF THE ASSESSEE. FURTHER, THE LD. AR SUBMITTED THAT THE PR OVISIONS OF SECTION 199 OF THE ACT AND RULES MADE THEREUNDER ARE ENABLI NG PROVISIONS ONLY AND THE AO HAS NO POWER TO DISALLOW THE CREDIT WHICH IS AVAILABLE TO THE DEDUCTEE ON THE BASIS OF THE TDS C ERTIFICATES. FURTHER, HE ALSO SUBMITTED THAT THE PROVISIONS OF SECTION 19 9 OF THE ACT AND RULES MADE THEREUNDER CANNOT BE INTERPRETED IN SUCH A MANNER SO AS TO PERMIT THE INCOME TAX DEPARTMENT TO RETAIN THE AMOU NT OF TDS AS SUCH COURSE OF ACTION WOULD BE IN VIOLATION OF THE PROVISIONS OF ARTICLE 265 OF THE CONSTITUTION OF INDIA. THE LD. A R ALSO SUBMITTED THAT ONCE THE TAX HAS BEEN DEDUCTED AT SOURCE AND P AID TO THE CREDIT OF CENTRAL GOVERNMENT, A RIGHT IS CREATED IN FAVOUR O F THE DEDUCTEE WHICH CANNOT BE TAKEN AWAY OR ABRIDGED OR DILUTED I N ANY MANNER BY ANY OF ACTION OF THE TAX AUTHORITY. THE LD. AR FUR THER RELIED ON THE FOLLOWING DECISIONS :- 1. ARVIND MURJANI BRANDS (P) LTD. VS. ITO, 137ITD 173 MUM 2. ESCORTS LTD. VS. DCIT [2007] 15 SOT 368 ( DELHI ) 3. SUPREME RENEWABLE ENERGY LTD. VS. ITO 124ITD 394 CHENNAI 4. LUCENT TECHNOLOGIES GRL LLC VS. DDIT 45 SOT 311 MUM 7. ON THE OTHER HAND, LD DEPARTMENT REPRESENTATIVE (DR), RELYING ON THE LOWER AUTHORITIES, SUBMITTED THAT ASSESSES IS NOT HAVING ANY CASE AS THE ASSESSING OFFICER AND THE CIT(APPEALS) HAS R IGHTLY RESTRICTED ITA NO.4473/DEL/2012 5 THE CREDIT OF TDS IN PROPORTIONATE TO THE AMOUNT OF THE RECEIPT DECLARED BY THE ASSESSEE IN ITS PROFIT AND LOSS ACC OUNT. 8. WE HAVE HEARD THE RIVAL SUBMISSIONS AND ARGUME NTS ADVANCED BY BOTH THE PARTIES. THE ASSESSING OFFICER HAS DENIED THE CREDIT OF PART OF TDS DEDUCTED, INVOKING SECTION 199 OF THE ACT. THER EFORE, WE FEEL IT NECESSARY TO LOOK INTO SECTION 199 OF THE IT ACT, W HICH READS AS UNDER :- CREDIT FOR TAX DEDUCTED. 199. (1) ANY DEDUCTION MADE IN ACCORDANCE WITH THE FORE GOING 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 DEDUC TION WAS MADE, OR OF THE OWNER OF THE SECURITY, OR OF THE DEPOSITOR OR OF TH E 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 SECTION 192 AND PAID TO THE CENTRAL GOVERNMENT SHALL BE TREATED AS THE TAX PAID ON BEHA LF OF THE PERSON IN RESPECT OF WHOSE INCOME SUCH PAYMENT OF TAX HAS BEEN MADE. (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 53 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-S ECTION (2) AND ALSO THE ASSESSMENT YEAR FOR WHICH SUCH CREDIT MAY BE GIVEN. ] 9. FURTHER, IN TERMS OF THE PROVISIONS OF SUB SEC TION (3) OF SECTION 199 OF THE ACT, THE CBDT HAS MADE RULES FOR THE PU RPOSE OF GIVING CREDIT OF TDS IN THE CASE OF DEDUCTEE AND OTHER PE RSONS AS WELL AS FOR MULTIPLE ASSESSMENT YEARS, WHICH READS AS UNDER :- CREDIT FOR TAX DEDUCTED AT SOURCE FOR THE PURPO SES OF SECTION 199. 37BA. (1) CREDIT FOR TAX DEDUCTED AT SOURCE AND PAID TO THE CENTRAL GOVERNMENT IN ACCORDANCE WITH THE PROVISION S OF CHAPTER XVII, SHALL BE GIVEN TO THE PERSON TO WHOM PAYMENT ITA NO.4473/DEL/2012 6 HAS BEEN MADE OR CREDIT HAS BEEN GIVEN (HEREINAFTER REFERRED TO AS DEDUCTEE) ON THE BASIS OF INFORMATION RELATIN G TO DEDUCTION OF TAX FURNISHED BY THE DEDUCTOR TO THE I NCOME-TAX AUTHORITY OR THE PERSON AUTHORIZED BY SUCH AUTHORIT Y. (2) (I) IF THE INCOME ON WHICH TAX HAS BEEN DEDUCTE D AT SOURCE IS ASSESSABLE IN THE HANDS OF A PERSON OTHER THAN T HE DEDUCTEE, CREDIT FOR TAX DEDUCTED AT SOURCE SHALL B E GIVEN TO THE OTHER PERSON IN CASES WHERE--- (A) THE INCOME OF THE DEDUCTEE IS INCLUDED IN THE TOTAL INCOME OF ANOTHER PERSON UNDER THE PROVISIONS OF SE CTION 60, SECTION 61, SECTION 64, SECTION93 OR SECTION94; (B) THE INCOME OF A DEDUCTEE BEING AN ASSOCIATION OF PERSONS OR A TRUST IS ASSESSABLE IN THE HANDS OF MEMBERS OF THE ASSOCIATION OF PERSONS, OR IN THE HANDS OF TRUSTEES , AS THE CASE MAY BE; (C) THE INCOME FROM AN ASSET HELD IN THE NAME OF A DEDUCTEE, BEING A PARTNER OF A FIRM OR A KARTA OF A HINDU UND IVIDED FAMILY, IS ASSESSABLE AS THE INCOME OF THE FIRM, OR HINDU UNDIVIDED FAMILY, AS THE CASE MAY BE; (D) THE INCOME FROM A PROPERTY, DEPOSIT, SECURITY, UNIT OR SHARE HELD IN THE NAME OF A DEDUCTEE IS OWNED JOINT LY BY THE DEDUCTEE AND OTHER PERSONS AND THE INCOME IS ASSESS ABLE IN THEIR HANDS IN THE SAME PROPORTION AS THEIR OWNERSH IP 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 RELATIN G TO DEDUCTION OF TAX REFERRED TO IN SUB-RULE (1). (II) THE DECLARATION FILED BY THE DEDUCTEE UNDER CL AUSE (I) SHALL CONTAIN THE NAME, ADDRESS, PERMANENT ACCOUNT NUMBER OF THE PERSON TO WHOM CREDIT IS TO BE GIVEN, PAYMEN T OR CREDIT IN RELATION TO WHICH CREDIT IS TO BE GIVEN AND REAS ONS FOR GIVING CREDIT TO SUCH PERSON. (III) THE DEDUCTOR SHALL ISSUE THE CERTIFICATE FOR DEDUCTION OF TAX AT SOURCE IN THE NAME OF THE PERSON IN WHOSE NA ME CREDIT ITA NO.4473/DEL/2012 7 IS SHOWN IN THE INFORMATION RELATING TO DEDUCTION O F TAX REFERRED TO IN SUB-RULE (1) AND SHALL KEEP THE DECL ARATION IN HIS SAFE CUSTODY. (3) (I) CREDIT FOR TAX DEDUCTED AT SOURCE AND PAID TO THE CENTRAL GOVERNMENT, SHALL BE GIVEN FOR THE ASSESSME NT YEAR FOR WHICH SUCH INCOME IS ASSESSABLE. (II) WHERE TAX HAS BEEN DEDUCTED AT SOURCE AND PAID TO THE CENTRAL GOVERNMENT AND THE INCOME IS ASSESSABLE OVE R A NUMBER OF YEARS, CREDIT FOR TAX DEDUCTED AT SOURCE SHALL BE ALLOWED ACROSS THOSE YEARS IN THE SAME PROPORTION I N WHICH THE INCOME IS ASSESSABLE TO TAX. (4) CREDIT FOR TAX DEDUCTED AT SOURCE AND PAID TO T HE ACCOUNT OF THE CENTRAL GOVERNMENT SHALL BE GRANTED ON THE B ASIS OF --- (I) THE INFORMATION RELATING TO DEDUCTION OF TAX FU RNISHED BY THE DEDUCTOR TO THE INCOME-TAX AUTHORITY OR THE PER SON AUTHORIZED BY SUCH AUTHORITY; AND (II) THE INFORMATION IN THE RETURN OF INCOME IN RES PECT OF THE CLAIM FOR THE CREDIT, SUBJECT TO VERIFICATION IN AC CORDANCE WITH THE RISK MANAGEMENT STRATEGY FORMULATED BY THE BOARD FROM TIME TO TIME. 10. ON PLAIN READING OF SECTION 199 OF THE ACT A ND RULES MADES THEREUNDER, IT IS APPARENT THAT SUB SECTION 2 AND 3 OF THE SECTION ARE NOT APPLICABLE TO THE FACTS OF THE CASE IN HAND. FU RTHER, SUB RULE (2) AND (3) OF RULE 37BA OF THE INCOME-TAX RULES ARE ALSO NOT APPLICABLE TO THE FACTS OF THE CASE IN HAND, AS TH E INCOME OF THE ASSESSEE IS NOT FALLING UNDER ANY OF THE CLAUSES OF SUB RULE (2) AND ISSUE OF CREDIT IN MULTIPLE YEARS IS ALSO NOT INVOL VED IN THE CASE IN HAND. SO, ONLY SUB SECTION (1) OF SECTION 199 OF THE ACT, AND SUB ITA NO.4473/DEL/2012 8 RULE (1) AND (4) OF THE RULE 37BA OF THE RULES ARE RELATED TO THE CASE OF THE ASSESSEE. THE FIRST LIMB OF THE SAID SUBSEC TION REFERS TO THE TAX DEDUCTED AND PAID TO THE CENTRAL GOVERNMENT. THE SE COND LIMB OF THE SUB SECTION REFERS TO ALLOWING OF CREDIT OF THE TAX SO DEDUCTED AND PAID TO CENTRAL GOVERNMENT, IN THE HANDS THE PERSON FROM WHOSE INCOME, THE TAX HAS BEEN DEDUCTED. SO, A PLAIN AND LITERAL INTERPRETATION OF SUB SECTION (1) OF SECTION 199 LE ADS TO RESULT THAT THE CREDIT OF THE TAX DEDUCTED HAS TO BE GIVEN IN THE H ANDS OF THE DEDUCTEE I.E. THE PERSON FROM WHOSE INCOME THE DEDUCTION WAS MADE. THUS, SAID SUB SECTION NOWHERE SAYS THAT CREDIT OF TDS SH OULD BE RESTRICTED ONLY TO THE AMOUNT OF INCOME OR RECEIPT OFFERED IN THE RETURN OF INCOME OR IN THE PROFIT AND LOSS ACCOUNT. FURTHER, SUB RULE (1) OF RULE 37BA OF THE RULES ALSO EMPHASIZE TO ALLOW THE CREDIT IN THE HANDS OF DEDUCTOR ON THE BASIS OF THE INFORMATION R ELATED TO DEDUCTION OF TAX FURNISHED BY THE DEDUCTOR. WITH EFFECT FROM 1.4.2008, THE SECTION 199 OF THE ACT HAS UNDERGONE A CHANGE AND T HE REQUIREMENT OF TDS CERTIFICATE FOR TAX CREDIT HAS BEEN DISPENSE D WITH AND NOW THE CREDIT IS BEING ALLOWED AS PER RULE 37BA(4) OF THE RULES ON THE BASIS OF INFORMATION AVAILABLE IN THE INCOME TAX STATEMEN T (ITS) OF THE ASSESSEE ON THE DATA BASE OF INCOME TAX DEPARTMENT OR ON THE BASIS OF FORM NO. 26AS OF INCOME TAX FORMS. IN THE CASE O F THE ASSESSEE THE INFORMATION AS TO THE INCOME AND THE TAX DEDUCT ED WAS AVAILABLE IN THE ITS. THE ASSESSING OFFICER, HAS ACCEPTED THE DIVERSION OF ITA NO.4473/DEL/2012 9 INCOME IN THE HAND OF SHRI KAPIL AHLUWALIA BUT DENI ED THE CREDIT OF THE TOTAL TAX DEDUCTED BY THE DEDUCTOR. WE FIND THA T THE ACTION OF THE ASSESSING OFFICER WAS ON THE BASIS OF THE INCORRECT INTERPRETATION OF THE SUB SECTION (1) OF SECTION 199 OF THE ACT. THE INC OME-TAX APPELLATE TRIBUNAL, MUMBAI BENCH A IN THE CASE OF ARVIND MURJ ANI BRANDS (P) LTD. VS. ITO, WARD 5 (1), MUMBAI REPORTED (SUPRA) HAS HELD AS UNDER :- THAT THIS SECTION RECOGNIZES A VERY IMPORTANT POSITION OF LAW, THAT THE TAX DEDUCTED AT SOURCE IS TREATED AS A PAYMENT OF TAX ON BEHALF OF THE PERSON FROM WHOSE INCOME TH E DEDUCTION WAS MADE AND CONSEQUENTLY CREDIT SHALL BE GIVEN TO HIM FOR THE AMOUNT SO DEDUCTED.SO THE ROL E OF SECTION 199 IS CONFINED TO ALLOWING THE CREDIT FOR THE TAX DEDUCTED AT SOURCE TO THE PAYEE OF THE AMOUNT AND N ONE ELSE. 11. FURTHER IN THE CASE OF ESCORTS LTD. VS. DCIT ( SUPRA) THE TRIBUNAL HAS HELD AS UNDER :- AS PER OUR CONSIDERED VIEW, CREDIT FOR TDS MUST IN EVERY CASE BE GIVEN TO THE ASSESSEE FROM WHOSE INCO ME TAX WAS DEDUCTED AT SOURCE AND PAID TO THE CREDIT OF TH E CENTRAL GOVERNMENT. IF THE RECIPIENT OF THE INCOME CONSIDER S THAT HE IS NOT LIABLE TO TAX IN RESPECT OF THE INCOME, WHOL LY OR PARTLY, THEREFORE, DOES NOT DISCLOSE THE AMOUNT OF SUCH INC OME IN HIS RETURN, THE INCOME-TAX DEPARTMENT CANNOT REFUSE TO GIVE CREDIT MERELY BY CONTENDING THAT THE INCOME HAD NOT BEEN DISCLOSED IN THE RETURN FILED BY THE ASSESSEE FOR T HE ASSESSMENT YEAR. ITA NO.4473/DEL/2012 10 12. FURTHER, THE DECISIONS OF THE TRIBUNAL IN CASES OF RENOVATION TECHNOLOGIES (SUPRA) AND SUPREME RENEWABLE ENERGY L TD. (SUPRA) ALSO SUPPORT THE STAND OF THE ASSESSEE. FURTHER, TH E FACT THAT THE DEPARTMENT HAS NEITHER GIVEN CREDIT FOR THE TAX OF RS. 12,23,608 TO THE ASSESSEE OR TO SHRI KAPIL AHLUWALIA NOR REFUNDED TH E SAID SUM TO THE DEDUCTOR. THE CONSTITUTION HAS NOT MANDATED THE DEP ARTMENT TO SWALLOW THE RIGHTFUL MONEY OF THE TAX PAYER WITHOUT ANY RULE OF LAW. FURTHER, THE DEPARTMENTAL REPRESENTATIVE SUBMITTED THAT THERE IS POSSIBILITY THAT SHRI KAPIL AHLUWALIA MIGHT HAVE TA KEN CREDIT OF THE BALANCE RS. 12, 23,608/- AND THEREFORE IF CREDIT OF THIS AMOUNT IS ALLOWED TO THE ASSESSEE, IT WILL AMOUNT TO ALLOWING OF DOUBLE CREDIT OF THE SAME ACCOUNT AND IT WILL BE UNJUST ENRICHMENT I N THE HANDS OF ASSESSEE. THE LD. AR HOWEVER, COUNTERED THE ARGUMEN T OF THE DR AND STATED THAT THE TDS CERTIFICATE HAS BEEN ISSUED TO THE ASSESSEE ONLY AND AS PER DATA BASE OF INCOME-TAX DEPARTMENT, THE TDS IS REFLECTING AGAINST THE ASSESSEE ONLY, THEREFORE ALLOWING CREDI T IN THE HANDS OF SHRI KAPIL AHLUWALIA WAS NOT POSSIBLE. HE FURTHER SUBMITTED THAT SH. KAPIL AHLUWALIA IS LIABLE TO PAY TAX ON THE INC OME TRANSFERRED TO HIM, AND THEREFORE, NOT ALLOWING CREDIT OF RS. 12,2 3,608/- TO THE ASSESSEE AND RETAINING THE AMOUNT BY THE INCOME-TAX DEPARTMENT WITHOUT GIVING ADJUSTMENT TO EITHER ASSESSEE OR SH. KAPIL AHLUWALIA AMOUNTS TO UNJUST ENRICHMENT IN THE HANDS OF THE DE PARTMENT. WE AGREE WITH THE ABOVE CONTENTION OF THE LD. AUTHORIS ED REPRESENTATIVE. ITA NO.4473/DEL/2012 11 WE ARE OF THE VIEW THAT NEITHER PARTY SHOULD BE MAD E UNJUST ENRICHED AT THE COST OF THE OTHER. WE HOLD THAT THE CREDIT O F THE RS. 12,23,608/- IS ALLOWABLE IN THE HANDS OF THE ASSESSEE, IN VIEW OF THE CLEAR PROVISIONS OF SUB SECTION(1) OF SECTION 199 OF THE ACT AND RULES MADE THEREUNDER. HOWEVER, WE DIRECT THE ASSESSING O FFICER TO VERIFY WHETHER ANY CREDIT OF THE TDS OF RS. 12,23,608/- HA S BEEN ALLOWED BY THE INCOME-TAX DEPARTMENT IN THE HANDS OF SHRI K APIL AHLUWALIA OR NOT. IF IT HAS BEEN NOT ALLOWED, THEN THE CREDIT OF THIS AMOUNT SHOULD BE GIVEN IN THE HANDS OF THE ASSESSEE. ACCOR DINGLY GROUND NO. 1 OF THE ASSESSEE IS ALLOWED. 13. AS REGARDS OF THE GROUND NO. 2 OF THE ASSES SEE, WHEREIN THE ASSESSEE HAS SOUGHT AN ALTERNATIVE PLEA FOR ALLOWIN G THE CREDIT OF SAID SUM OF THE TDS IN THE HANDS OF SHRI KAPIL AHLUWALIA . SINCE THE GROUND NO. 1 HAS ALREADY BEEN DECIDED IN FAVOUR OF THE ASSESSEE, THE ALTERNATIVE PLEA IS RENDERED INFRUCTUOUS AND THEREF ORE NO ADJUDICATION IS REQUIRED ON THIS GROUND. 15. IN THE RESULT APPEAL OF THE ASSESSEE IS PARTLY ALLOWED FOR STATISTICAL PURPOSE. (ORDER PRONOUNCED IN THE COURT ON 21/08/2015). SD/- SD/- (H.S. SIDHU) (O.P.KANT) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 21 / 08/2015 *BINITA* ITA NO.4473/DEL/2012 12 COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR DATE INITIAL 1. DRAFT DICTATED ON 18/8/2015 2. DRAFT PLACED BEFORE AUTHOR 18/8/2015 3. DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER JM/AM 4. DRAFT DISCUSSED/APPROVED BY SECOND MEMBER. JM/AM 5. APPROVED DRAFT COMES TO THE SR.PS/PS PS/PS 6. KEPT FOR PRONOUNCEMENT ON PS 7. FILE SENT TO THE BENCH CLERK PS 8. DATE ON WHICH FILE GOES TO THE AR 9. DATE ON WHICH FILE GOES TO THE HEAD CLERK. 10. DATE OF DISPATCH OF ORDER.