GST regime: Madras HC allows claiming input tax credit on TDS from VAT

The petitioners' counsel submitted that TDS is nothing but tax and the TNVAT Act makes this position clear

The Madras High Court has allowed assessees to claim input tax credit for tax deducted at source (TDS) pending from the value-added tax (VAT) regime under the current goods and services tax (GST) system. The order, passed by Justice Anita Sumant, stated that any deduction made towards an anticipated tax liability assumes the character of tax. Thus, TDS would stand included for transition into the GST law.

The court passed the order after hearing 23 petitions filed by assessees under the Tamil Nadu Goods and Service Tax Act, 2017 (TNGST Act), challenging the notices issued by the commercial tax department proposing