M/S J & J ASSOCIATES, vs. THE INCOME TAX OFFICER,

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WP(C)/8790/2022HC KeralaKLHC01018881202228 September 2022Author: HONOURABLE MR. JUSTICE GOPINATH P.4 pages
AI SummaryRemanded

What did the High Court hold?

The High Court disposed of the writ petition by directing the Income Tax department to provide a link for uploading documents necessary for the transfer of TDS credit from the managing partner to the firm's account, subject to the petitioner complying with all procedural formalities. The Court noted the submission by the department regarding Rule 37BA(2) of the Income Tax Rules, which allows for such a transfer upon compliance. Proceedings initiated against the petitioner for recovery of amounts due under an assessment order (Ext.P1) were ordered to be kept in abeyance for two months to allow the petitioner to avail the option under Rule 37BA(2). The Court did not decide on the merits of any assessment but facilitated the procedural remedy.

What were the facts?

The petitioner, M/s J & J Associates, is aggrieved because Tax Deducted at Source (TDS) made in the name of its managing partner, Mr. V.K. Viju, has not been credited to the firm's account. The petitioner explains that some works were initially executed in the managing partner's name, and the government department that made payments deducted TDS and remitted it to the managing partner's credit. The petitioner sought a remedy for this discrepancy.

What were the issues?

1. Whether the petitioner can obtain credit for TDS deducted in the name of its managing partner in the firm's account, considering the procedural requirements under the Income Tax Rules? The assessee (petitioner) contended that TDS was deducted in the name of the managing partner for works done by the firm, and they sought to have this credit transferred to the firm. The revenue (respondent) pointed to Rule 37BA of the Income Tax Rules, specifically sub-rule (2), which outlines the procedure for transferring TDS credit. The revenue indicated that compliance with this procedure would enable the credit transfer and offered to provide a link for uploading necessary documents.

Which sections of the Income-tax Act were involved?

Rule 37BA

AI-generated summary — verify with the full judgment below

Cause title — parties, addresses and appearances
IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR. JUSTICE GOPINATH P. WEDNESDAY, THE 28TH DAY OF SEPTEMBER 2022 / 6TH ASWINA, 1944 WP(C) NO. 8790 OF 2022 PETITIONER/S: M/S J & J ASSOCIATES, VANACHIRAKKAL HOUSE, THENGODE P.O., ERNAKULAM-682 021, REPRESENTED BY ITS MANAGING PARTNER. BY ADV M.S.AMAL DHARSAN RESPONDENT/S: 1 THE INCOME TAX OFFICER, WARD 2(1), KOCHI-682 016. 2 THE ASSISTANT COMMISSIONER OF INCOME TAX X 3 THE ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE 2(2), KOCHI-682 016. BY ADV CHRISTOPHER ABRAHAM THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 28.09.2022, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C) NO. 8790 OF 2022 2

JUDGMENT

Petitioner is aggrieved by the fact that certain TDS deducted in the name of the managing partner of the petitioner firm has not been given credit to in the name of the firm. It is submitted that initially, some of the works undertaken by the petitioner firm were executed in the name of the managing partner Mr.V.K. Viju and while making payments, the Government department, for which the work was done, had deducted tax and paid it to the credit of the managing partner.

2.

When this matter is taken up for consideration today, the learned Standing Counsel for the department points out the provisions of Rule 37BA of the Income Tax Rules and states that on the procedure contemplated therein in sub-rule (2) of Rule 37BA being complied with, the credit can be transferred. He submits that on a request being made, a link can be provided for enabling compliance with the procedure contemplated by sub- rule(2) of Rule 37BA of the Income Tax Rules.

3.

Taking note of the above submission, this writ petition will stand disposed of directing that on a proper application being made, the Income Tax department will provide a link for uploading the documents necessary for transfer of credit of TDS

WP(C) NO. 8790 OF 2022 3 from the managing partner of the petitioner firm to the account of the firm, subject to compliance with all procedural formalities. Proceedings, if any, initiated against the petitioner for recovery of amounts due under Ext.P1 order of assessment shall be kept in abeyance for a period of two months to enable the petitioner to avail the option under Rule 37BA(2) of the Income Tax Rules.

The writ petition is disposed of as above GOPINATH P. JUDGE ajt

WP(C) NO. 8790 OF 2022 4

Appendix — schedule of exhibits
APPENDIX OF WP(C) 8790/2022 PETITIONER EXHIBITS Exhibit P1 TRUE COPY OF THE ASSESSMENT ORDER DATED 14.02.20134 FOR THE ASSESSMENT YEAR 2012-13. Exhibit P2 TRUE COPY OF THE RECTIFICATION APPLICATION DATED 10.06.2014 SUBMITTED BY THE PETITIONER BEFORE THE 1ST RESPONDENT. Exhibit P3 TRUE COPY OF THE REMINDER LETTER DATED 28.,02.2022 ISSUED BY THE PETITIONER TO THE 1ST RESPONDENT. Exhibit P4 TRUE COPY OF THE INTERIM ORDER DATED 01.11.2021 IN WPC NO.2442/2019. Exhibit P5 TRUE COPY OF THE INTERIM ORDER DATED 02.03.2022 IN WPC NO.6806/2022.

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