DHANANJAY G MISHRA,MUMBAI vs. ACIT, CIR-20(1), MUMBAI

Dhananjay G. Mishra ACIT, Circle-20(1), W-1402, World Crest, Senapati Piramal Chambers, Lalbaug, Bapta Marg, Lower Parel, The Mumbai-400013. Vs. World Towers Delisle Road, Mumbai-400013. PAN No. AFLPM1475K Appellant) : Respondent) Appellant/Assessee by : Shri Satish Mody, Adv. Respondent/Department by : Smt. Mahita Nair, CIT-DR Date of Hearing : 21.09.2023 Date of Pronouncement : 22.09.2023 O R D E R Per N. K. Choudhry, JM:

The Assessee/Appellant herein has preferred this appeal against the order dated 03.05.2023 impugned herein passed by National Faceless Appeal Centre, Delhi, {in short ‘NFAC’} under section 250 of the Income Tax Act 1961 (in short ‘the Act’).

Dhananjay G. Mishra . 2. In the instant case, the AO vide order dated u/s 154 r.w.s. 143(1) of the Act made the disallowance of TDS credit of Rs. 573900/- on the ground that YMS i.e. proprietorship concern ended in 31.10.2015 and new concern i.e. YMSPL has succeeded.

(ii) The declaration filed by the deductee under clause (i) shall contain the name, address, permanent account number of the person to whom credit is to be given, payment or credit in relation to which credit is to be given and reasons 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 name credit is shown in the information relating to deduction of tax referred to in sub-rule (1) and shall keep the declaration in his safe custody." As per these provisions, the credit for this TDS of Rs. 24,41,710/- should have been claimed by the company YMSPL. The deductee should have given a declaration in this respect to the deductors, and they would have incorporated the information relating to the company YMSPL in the information of TDS certificates, thereby enabling the company to claim the credit for this TDS. Thus, the appellant has not complied with these statutory provisions, and consequently the credit for this TDS cannot be allowed. It is reiterated that this credit can be allowed in the hands of the new company YMSPL on the compliance of the above-mentioned conditions, but it cannot be allowed in the hands of the appellant in any case. The provisions of Rule 37BA(2)(1) make it amply clear. Therefore, the grounds of appeal no. 1, 2 and 3 are hereby disallowed. Consistently following the same approach in the current year also, it is held that the entire income of the business is assessable in the hands of the successor company YMSPL, since the proprietorship concern YMS has been wound up on 31.10.2015. Accordingly, the addition of Rs.22,98,480/- made by the CPC taking the profit rate @ 8% is hereby deleted. In any case the addition is on a debatable issue and clearly falls outside the scope of section 143(1) of the Income-Tax Act. However, the Appellant will not get credit for the TDS corresponding to these receipts of Rs. 2,86,26,927/- as per the provisions of rule 37BA of the Income-Tax Rules. This is also consistent with the decision of the undersigned in the Assessment year 2016-17. The grounds of appeal no. 1, 2 and 3 are thus partly allowed as above.”