In K.S. Venugopalan, Operator, Travancore Cochin Chemicals Ltd. vs. Income-tax Officer, it was held that the excess tax deducted by the employer shall not be the reason for filing the writ petition by the employee as its credit can be claimed in the return.
Facts of the case:
The petitioner was an employee of the Travancore Cochin Chemicals Limited. He had availed a loan from the Union Bank of India in an amount of Rs.5 lakhs in the year 2002. The repayment was scheduled at Rs. 4400 every month for 20 years. From 2006 onwards, the employer began to deduct tax at source on the entire amount paid to him by way of salary.
From the instruction received from the employer, it was made clear that since the house was in the joint names of the petitioner and his wife, the petitioner was not entitled to a deduction in respect of the amounts paid by him by way of monthly repayments. The facility for deduction of the repayment was available only if the house constructed using the loan amount was in the name of the petitioner alone.
Pursuant to such instruction, the petitioner filed instant writ petition seeking inter alia a direction to the respondents to assess him for tax only after deducting the monthly installments recovered from the salary towards housing loan repayment.
It was held that:
It was noted that in the initial period after availing the loan, the employer had deducted lesser amounts by way of tax deducted at source from payments effected to him. This was done taking note of the fact that he would be entitled to a deduction in respect of the amounts paid by him towards monthly repayments of the loan to the bank.
This was done taking note of the fact that he would be entitled to a deduction in respect of the amounts paid by him towards monthly repayments of the loan to the bank. This was because the eligibility of the petitioner to claim deduction in terms of section 80C(2)(xviii) was held to be doubtful, in view of the fact that house that was constructed using the loan was in the joint names of the petitioner and his wife.
The Court was of view that whatever tax is deducted at source is credited to the account of the department and the said payments would be given credit while completing the individual assessment of petitioner. Therefore, if any amount had been deducted in excess from the payments effected to the petitioner, he was not seriously aggrieved because he would get credit of the same in his assessment.
It was made clear that the excess amount deducted which was in excess of his tax liability shall be refunded to him. It was concluded that the writ petition shall not be filed for the excess deduction as its credit can be claimed in return. The writ petition was thus, dismissed as there was no ground to grant any relief as sought for by the assesse.

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