ITO NON CORPORATE WARD 3(5), CHENNAI vs. S.NASEEMA SIDDIQ, CHENNAI

Revenue against the Order of the Commissioner of Income Tax (Appeals)-4, Chennai, in 2013-14/CIT(A)-4 dated 14.07.2017 for the AY 2013-14.

Mrs.S.Vijayaprabha, JCIT., represented on behalf of the Revenue and Mr.D.Anand, Adv., represented on behalf of the assessee.

It was submitted by the Ld.DR that the assessee owns a property at Secretariat Colony, Kilpauk, Chennai, which is given on rent and the assessee offered the same as income. The assessee, further, jointly owns six other properties along with her husband. Out of the six properties, one property at Rutland Gate, IV Street, is a self-occupied property and in respect of the balance five properties, the assessee derived 50% of the share of the rent. The share of rent in respect of the assessee was clubbed in the hands of the assessee’s husband Shri S.Abubucker Siddiq u/s.64(1) of the Act. It was a submission that the assessee had claimed TDS deducted on her share of rent in her hands. It was a submission that as the assessee had not offered her share of rent but the same was offered in the hands of her husband in view of the provisions of Sec.64(1), the credit of TDS was not allowed in the hands of the assessee. It was a submission that on appeal, the Ld.CIT(A) had directed that as the entire rent had been offered in the hands of the husband in view of the provisions of Sec.64(1), the TDS was liable to be refunded to the assessee in respect of the TDS deducted in her hands. It was a submission that the findings of the Ld.CIT(A) was erroneous in view of the provisions of Rule 37BA(2)(i) of the IT Rules. It was a submission that the order of the Ld.CIT(A) was liable to be reversed.

In reply, the Ld.AR vehemently supported the order of the Ld.CIT(A). It was a submission that the entire rent including that received by the assessee had been offered by her husband in view of the provisions of Sec.64(1) and tax on the same, had also been paid in full. It was a further submission that the husband has not claimed the credit of the TDS effected in the case of the assessee. It was a submission that the order of the Ld.CIT(A) was liable to be confirmed.

We have considered the rival submissions.

A perusal of the facts in the present case clearly shows that it is an undisputed fact that the share of rental income in the case of the assessee in respect of the five properties rented out which are jointly owned with the assessee’s husband, have been offered by the assessee’s husband when filing his return for the relevant Assessment Year. A perusal of the order of the Ld.CIT(A) also clearly shows that the income has been offered in the hands of the assessee’s husband. The assessee’s husband has also not claimed the benefit of the TDS deducted in the case of the assessee but has paid the tax in respect of the entire rental income. This being so, admittedly, we find no error in the order of the Ld.CIT(A) which calls for any interference. Even otherwise, the AO having accepted the fact that the assessee’s share from the rental income having been offered in the hands of the assessee’s husband, if at all wanted to disallow the claim of the TDS deducted in her hands, ought to have granted the benefit of the TDS in the hands of the assessee’s husband which has admittedly not been done also. This is not a case where the rental income has not been offered to tax. This is a case where the rental income has been clubbed in view of the provisions of Sec.64(1) and the rental income has been offered in its entirety. Therefore, the TDS, if any, in respect of the rent received is liable to be given credit for. The TDS having not been given credit for in the hands of the assessee’s husband on account of the full payment of the tax by the assessee’s husband, the TDS has been rightly directed to be refunded in the case of the assessee. In these circumstances, we find no error in the order of the Ld.CIT(A) which calls for any interference.

In the result, the appeal filed by the Revenue is dismissed.