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2013 (4) TMI 550 - AT - Income TaxTDS liability - Payment of compensation on acquisition of certain immovable property - demands raised on the appellant under section 201 r.w.s. 194 LA for non deduction of tax at source - Held that:- The payment to the actual beneficiary is made by the Competent Authority of Metro Railways Kolkata and not by the Dy FA and CAO of Metro Railways Kolkata. No doubt, the tax deduction obligations are on the person who makes payment to the beneficiary, and it was an undisputed position that the payment for land acquisition was made by the Land Acquisition Officer. In this matter, as in decided in State of MP v. Parwatibai [2002 (10) TMI 740 - MADHYA PRADESH HIGH COURT] the tax deduction obligation are on the person who "had money in his possession and was responsible for making the payment of that income to the assessee (i.e. actual beneficiary of compensation in this case). It is important to bear in mind the fact that the assessee is this case was the person receiving the compensation in his own right and not in any fiduciary capacity. Therefore, even going by this principle, the tax deduction liability is on the Competent Authority of Metro Railways Kolkata who makes the payment to the person receiving compensation. For the reasons set out above, as also bearing in mind entirety of the case, the grievance of the assessee in principle but in effect remit the matter back to the file of the AO for fresh adjudication in accordance with the law, by way of a speaking order and after giving a fair and reasonable opportunity of hearing to the person concerned, i.e. Competent Authority of Metro Railways Kolkata.
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