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Carry Forward Claim of TDS

Posted @ July 21, 2016, 9:28 pm under (Tax - General)

Rule 37BA of Income Tax Rules provides for apportionment and Carry Forward Claim of TDS.

As per rule 37BA TDS credit should match with the assessable income.

As per Sub Rule (3) of Rule 37BA:

(3) (i) Credit for tax deducted at source and paid to the CentralGovernment, shall be given for the assessment year for which such income isassessable.


(ii) Where tax has been deducted at sourceand paid to the Central Government and the income is assessable over a numberof years, credit for tax deducted at source shall be allowed across those yearsin the same proportion in which the income is assessable to tax.

Thus, Credit for TDS to be given to the assessee in the assessment year in which the corresponding income is assessable, if only a portion of income is found assessable in the relevant year, credit has to be allowed only on that portion on pro rata basis and credit for the balance TDS is to be allowed only in future when remaining income is assessable Predeepkumat Dhir Vs. ACIT 109 TTJ 445 TM (ITAT Chandigarh).

As per NOTIFICATION NO. 28/2009, DATED 16-3-2009 Credit for tax deducted at source for the purposes of section 199.

37BA. (1) Credit for tax deducted at source and paid to the Central Government in accordance with the provisions of Chapter XVII, shall be given to the person to whom payment has been made or credit has been given (hereinafter referred to as deductee) on the basis of information relating to deduction of tax furnished by the deductor to the income-tax authority or the person authorised by such authority.

 

(2) (i) If the income on which tax has been deducted at source is assessable in the hands of a person other than the deductee, credit for tax deducted at source shall be given to the other person in cases where-

 

  1. the income of the deductee is included in the total income of another person under the provisions of section 60, section 61, section 64, section 93 or section 94;

 

  1. 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;

 

 

  1. the income from an asset held in the name of a deductee, being a partner of a firm or a karta of a Hindu undivided family, is assessable as the income of the firm, or Hindu undivided family, as the case may be;

  1. the income from a property, deposit, security, unit or share held in the name of a deductee is owned jointly by the deductee and other persons and the income is assessable in their hands in the same proportion as their ownership 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 relating to deduction of tax referred to in sub-rule (1).

(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 decuction 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.

 

(3) (i) Credit for tax deducted at source and paid to the Central Government, shall be given for the assessment 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 over a number of years, credit for tax deducted at source shall be allowed across those years in the same proportion in which the income is assessable to tax.

 

(4) Credit for tax deducted at source and paid to the account of the Central Government shall be granted on the basis of –

 

  1. the information relating to deduction of tax furnished by the deductor to the income-tax authority or the person authorized by such authority: and

  2. the information in the return of income in respect of the claim for the credit,

 

subject to verification in accordance with the risk management strategy formulated by the Board from time to time."

 

(B) after rule 37H, the following rule shall be inserted, namely:–

 

"Credit for tax collected a source for the purposes of sub-section (4) of section 206C.

 

37I. (1) Credit for tax collect at source and paid to the Central Government in accordance with provisions of section 260C of the Act, shall be given to the person form whom the tax has been collected, on the basis of the information relating to collection of tax at source (hereinafter referred to as the collector) to the income-tax authority or the person authorized by such authority.

 

(2) (i) Where tax has been collected at source and paid to the Central Government, credit for such tax shall be given for the assessment year for which the income is assessable to tax.

 

  1. Where tax has been collected at source and paid to the Central Government and the lease or license is relatable to more than one year, credit for tax collected at source shall be allowed across those years to which the lease or license relates in the same proportion.

 

(3) Credit for tax collected at source and paid to the account of the Central Government shall be granted on the basis of –

 

  1. the information relating to collection of tax furnished by the collector to the income-tax authority or the person authorized by such authority; and

  2. the information in the return of income in respect of the claim for the credit,

 

subject to verification in accordance with the risk management strategy formulated by the Board from time to time."

 

 

 


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