One of the reason why Linus Torvalds created Git was so that developers distributed across a wide area (in his case, the entire world) can work on the repository at the same time (concurrently).
Can someone explain me benefits of Git over TFS when the entire team is sitting in one location (one office) accessing the code repository server over LAN?
There are a number of good reasons to use DVCS (like Git) over SVCS (like TFVC or SVN). First for me is speed. As all actions are taken against a local copy of the repo Git out performs any server bases source control by an order of magnitude even with only a few users.
Second is workflow. In SVCS branching is an expensive operation as it is both slow and heavy weight. Not only do you need the additional disk space but you need to merge that beast too. In Git branching is local, cheap, and quick to merge. It is nit uncommon for a coder to create a branch for each feature or task that they want to perform locally. You should have a look at Git Flow as a very successful mechanism for developing in Git.
http://nvie.com/posts/a-successful-git-branching-model/
There are lots of other cool thing, those are just my favorites. Have a look at http://www.git-scm.com/about for a full set of core features.
Update: Forgot my other favorite feature... You get full collaborative code reviews with a feature called Pull Requests. Pull Requests let me brnach your code and fix something and then submit my change to you for review. We can colaboratebon the outcome and then you can merge it in when ready.
