Our Company entered into an agreement with Suzlon Energy Limited (Wind Power Project) for the financial year : 2010-11, project to be commissioned on or before 31st March,2011. We paid 86% of the payment after deducting TDS worth Rs.3,50,000/- and also sales invoice was raised by Suzlon Energy Limited (SEL) and at the same time we have taken bank loan for the above project and all these related transactions had been reflected in both the companies books of account.
SEL failed to commission the project before 31st March,2011 and the project was cancelled. They remitted the principle amount but they did not refund the TDS amount. SEL gave explanation that the TDS amount can be refunded only when any excess amount has been remitted and not for cancelled orders since no income has been shown in this case. They want are company to file IT revised return and claim the amount.
As per our knowledge Deductor can't claim refund because the amount deducted has been paid to the Central Govt. account and once paid, the Deductor has no right to claim back the TDS amount as refund. In case even if we file the revised return, the TDs amount will not be refunded to us, only the Deductee has right to claim. Please give your valuable suggestion as per act, how to claim TDS refund from Suzlon Energy Limited .
Please reply whether this contention is correct or not. If not please give clarification with sections, if any.
Regards,
Ch.Ajay Babu
Manager (Taxation)
CAclubindia
