M/S V.K. SOOD ENGINEERS & CONTRACTORS,PANCHKULA vs. DCIT, CIRCLE, PANCHKULA
आयकर अपीलीय अिधकरण,चǷीगढ़ Ɋायपीठ “बी” , चǷीगढ़
IN THE INCOME TAX APPELLATE TRIBUNAL, CHANDIGARH BENCH “B”, CHANDIGARH
HEARING THROUGH: PHYSICAL MODE
ŵी िवŢम िसंह यादव, लेखा सद˟ एवं ŵी परेश म. जोशी, Ɋाियक सद˟
BEFORE: SHRI. VIKRAM SINGH YADAV, AM & SHRI. PARESH M. JOSHI, JM
आयकर अपील सं./ ITA NO. 895/Chd/2024
िनधाŊरण वषŊ / Assessment Year : 2014-15
M/s V.K. Sood Engineers &
Contractors
H.No. 20, Sector 6, Panchkula
Haryana-134109
बनाम
The DCIT,
Circle, Panchkula
˕ायी लेखा सं./PAN NO: AAHFV7228E
अपीलाथŎ/Appellant
ŮȑथŎ/Respondent
िनधाŊįरती की ओर से/Assessee by :
Shri Vineet Krishan, Advocate
राजˢ की ओर से/ Revenue by :
Shri Dharam Vir, Addl. CIT, Sr. DR
सुनवाई की तारीख/Date of Hearing :
10/02/2025
उदघोषणा की तारीख/Date of Pronouncement : 19/02/2025
आदेश/Order
PER VIKRAM SINGH YADAV, A.M. :
This is an appeal filed by the Assessee against the order of the Ld.
CIT(A)/NFAC, Delhi dt. 25/06/2024 pertaining to Assessment Year 2014-15. 2. In the present appeal, the Assessee has raised the following grounds of appeal:
“1. That the order dated 25.06.2024, under section 250 of the Income Tax Act,
1961 passed by the Ld. Commissioner of Income Tax (Appeals), National Faceless
Appeal
Centre
(NFAC),
Delhi in Appeal
No.
ITBA/NFAC/S/250/2024-
25/1066009272(1) is contrary to law and facts of the case.
2(a). That in the facts and circumstances of the case, Ld. Commissioner of Income Tax (Appeals), gravelly erred in upholding the disallowance of credit of TDS amounting to Rs.6,45,453/- made by the Id. Assessing Officer.
2(b). Without prejudice to the above, the TDS deducted is allowable as prepaid tax in the respective year in which mobilisation advance has been adjusted against the running bills.
3. That in the facts and circumstances of the case. Ld. Commissioner of Income Tax (Appeals), gravelly erred in upholding the reassessment under Section 148 as invalid.
That the appellant craves to add, amend or alter any ground of appeal before or at the time of hearing of appeal, with the permission of the Hon'ble Income Tax Appellate Tribunal. Chandigarh.” 3. During the course of hearing, the Ld. AR referred to Ground No. 2 of the assessee’s appeal challenging the action of the Ld. CIT(A) in sustaining the disallowance of TDS credit amounting to Rs. 6,45,453/- made by the AO and in this regard, our reference was drawn to the relevant facts and findings of the Ld. CIT(A) which read as under: “8. Vide ground No. 3, the appellant contented that the assessing officer erred in making an addition of Rs. 6,45,453 on account of incorrect TDS credit. 8.1 The AO noted at the assessment stage that the appellant had received mobilization advance of Rs. 2,85,59,883, on which TDS was deducted. However, the mobilisation advances received from different parties were not adjusted and remained outstanding at the end of the year. In view of this, the AO held that since the mobilization advances received by the assessee to the tune of Rs. 2,85,59,883 were outstanding and no income was returned, TDS credit of Rs. 6,45,453 claimed by the appellant should not be given. Accordingly, TDS amounting to Rs. 6,45,453 was added to the total income. 8.2 The appellant by relying on the decision of Hon'ble ITAT, Chennai Bench in the case of Supreme Renewal Energy, 3 ITR (Chennai) contented that credit for TDS cannot be denied merely on the ground that the income from which tax has been deducted has not been offered to tax. However facts of the above case relied on by the appellate are different and as such the ratio is not applicable to the facts of this case.
3 The position of law has been clarified in Rule 37BA(3) of the Income-tax Rules 1962 which states that credit for TDS shall be given for the assessment year for which such income is assessable. In my opinion, mobilization advance is nothing but a bundle of income embedded therein for future years and the assessee will be entitled to credit of TDS as and when he offers the income therein for taxation. 8.4 Hon'ble Tribunal in the case of DCIT, Circle - 2(1)(1) vs. Cicon Engineers P. Ltd. In [2024] 160 taxmann.com 142 held that where assessee-company received mobilization advance during financial year 2016-17 but offered income on said advance in subsequent years, assessee was to be allowed TDS credit on said advance only in the relevant assessment year when the income was offered. Relevant extract is as under:
"In our opinion, as rightly pointed out by the Id. D.R., income and TDS credit to go together in any assessment year when the income has been accrued to the assessee. The contention of the Id. A.R. is that in earlier assessment year, it has been shown as a mobilization advance by payee and not an expenditure in the hands of that assessee as the assessee has no right to receive such amount as 3
sales receipt. In other words, it is only payment made in advance. In our opinion, this issue requires to be examined at the end of Id. AO and TDS credit to be given to the assessee in the year of offering the said amount of Rs.24,85,54,177/- + TDS as income of the assessee. In other words, TDS cannot be isolatedly taken in any assessment year without offering the corresponding income for taxation. With this observation, we remit the issue to the file of Id. AO for fresh consideration."
8.5 In view of the facts of the matter and relying on the above judicial pronouncement, I hold that TDS credit should be allowed in the year when relevant income has been offered. Therefore, I dismiss ground no. 3 raised by the appellant.”
It was submitted by the ld AR that though the Ld. CIT(A) has given the directions that the TDS credit should be allowed in the year when the relevant income has been offered and in this regard, our reference was drawn to the following chart depicting the respective years where the mobilization advance has been adjusted and income has been offered to tax: DETAILS OF RECOVERY OF MOBLIZATION ADVANCE AT MCD CAR PARKING PROJECT YEAR WISE 01/04/2014 TO 31/03/2020
DATE
PARTICULARS
AMOUNT RECOVERED
BALANCE
01-04-2014
OPENING BALANCE
25000000
31-03-2015
RECOVERED DURING THE FY 2014-15
4000000
21000000
BALANCE ON 31/03/2015
21000000
31-03-2016
RECOVERED DURING THE FY 2015-16
5500000
15500000
BALANCE ON 31/03/2016
15500000
31-03-2017
RECOVERED DURING THE FY 2016-17
5200000
10300000
BALANCE ON 31/03/2017
10300000
31-03-2018
RECOVERED DURING THE FY 2017-18
350000
9950000
BALANCE ON 31/03/2018
31-03-2019
RECOVERED DURING THE FY 2018-19
5250000
4700000
BALANCE ON 31/03/2019
31-03-2020
RECOVERED DURING THE FY 2019-20
4700000 NIL
BALANCE ON 31/03/2020
NIL
DETAILS OF RECOVERY OF MOBLIZATION ADVANCE AT PWD PUNHANA YEAR WISE 01/04/2014 TO 31/03/2017
DATE
PARTICULARS
AMOUNT RECOVERED
BALANCE
01-04-2014
OPENING BALANCE
1196000
31-03-2015
RECOVERED DURING THE FY 2014-15
296000
900000
BALANCE ON 31/03/2015
900000
31-03-2016
RECOVERED DURING THE FY 2015-16
0
900000
BALANCE ON 31/03/2016
900000
31-03-2017
RECOVERED DURING THE FY 2016-17
900000 NIL
BALANCE ON 31/03/2017
NIL
DETAILS OF RECOVERY OF MOBLIZATION ADVANCE AT PWD UJINA BOYS YEAR WISE 01/04/2014 TO 31/03/2015
DATE
PARTICULARS
AMOUNT RECOVERED
BALANCE
01-04-2014
OPENING BALANCE
1232783
31-03-2015
RECOVERED DURING THE FY 2014-15
1232783
NIL
BALANCE ON 31/03/2015
NIL
DETAILS OF RECOVERY OF MOBLIZATION ADVANCE AT PWD UJINA GIRLS YEAR WISE 01/04/2014 TO 31/03/2015
DATE
PARTICULARS
AMOUNT RECOVERED
BALANCE
01-04-2014
OPENING BALANCE
1131100
31-03-2015
RECOVERED DURING THE FY 2014-15
1131100
-
NIL
BALANCE ON 31/03/2015
NIL
DETAILS OF RECOVERY OF MOBLIZATION ADVANCE AT PWD PINGWAN YEAR WISE 01/04/2014 TO 31/03/2015
DATE
PARTICULARS
AMOUNT RECOVERED
BALANCE
01-04-2014
OPENING BALANCE
898000
31-03-2015
RECOVERED DURING THE FY 2014-15
898000
NIL
BALANCE ON 31/03/2015
NIL
In light of aforesaid, it was submitted by the ld AR that the limited prayer of the assessee is that the TDS credit should be allowed in the respective years of adjustment/recovery of mobilization advance wherein the advance so adjusted has been offered as income by the assessee and the matter may be referred to the juri ictional AO for necessary verification. 6. The Ld DR is heard who has not raised any specific objection where the matter is referred to the JAO for necessary verification. 7. After hearing both the parties and considering the material available on the record and taking into consideration the limited prayer made by the Ld. AR on behalf of the assessee, the matter relating to grant of TDS credit in the respective assessment years wherein the mobilization advance has been adjusted and corresponding income has been offered to tax by the assessee is set aside to the file of the juri ictional AO for necessary verification and examination after providing reasonable opportunity to the assessee. 8. In the result, appeal of the Assessee is allowed for statistical purposes. Order pronounced in the open Court on 19/02/2025 परेश म. जोशी
िवŢम िसंह यादव
(PARESH M. JOSHI)
( VIKRAM SINGH YADAV)
Ɋाियक सद˟ / JUDICIAL MEMBER
लेखा सद˟/ ACCOUNTANT MEMBER
AG
आदेश कᳱ ᮧितिलिप अᮕेिषत/ Copy of the order forwarded to :
अपीलाथᱮ/ The Appellant 2. ᮧ᭜यथᱮ/ The Respondent 3. आयकर आयुᲦ/ CIT 4. आयकर आयुᲦ (अपील)/ The CIT(A) 5. िवभागीय ᮧितिनिध, आयकर अपीलीय आिधकरण, च᭛डीगढ़/ DR, ITAT, CHANDIGARH 6. गाडᭅ फाईल/ Guard File
आदेशानुसार/ By order,
सहायक पंजीकार/