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2005 (10) TMI 433 - AT - Income TaxTDS u/s 192 or 194J - liability to deduct tax - Some fixed share of fees paid to the consultant doctors rendering their services in its hospital - ‘fees for professional services’ Or ‘Income from salary’ - relationship between the assessee and the consultant doctors - HELD THAT:- A careful perusal of the appointment letters shows that out of the eighteen consultant doctors in question, eleven doctors were being paid a fixed monthly amount by the assessee whereas the remaining seven doctors were being paid some fixed share of fees received from private patients treated by them in addition to the fixed monthly payment. Keeping in view the position arising from the terms of appointment of consultant doctors as well as the Service Rules governing the employees of the assessee’s hospital, it can reasonably be concluded that all the consultant doctors were employees of the assessee and even if there was a distinction between the terms of employment of the permanent employees and the terms of employment of consultant doctors, the fact remains to be seen is that they were the employees of the assessee falling in the category of fixed period/contract employee and/or part-time employee. It, therefore, follows that the relationship between the assessee and the consultant doctors was purely that of employer and employee and remuneration paid to them in terms of the said relationship was salary which attracted the provisions of section 192. As such, we are of the considered opinion that there was an employer-employee relationship between the assessee and the consultant doctors and cones- quently, remuneration paid to them was chargeable to tax under the head ‘Salaries’. The said payments thus were subject to deduction of tax as per the provisions of section 192 and not as per the provisions of section 194J. In that view of the matter, we hold that the Assessing Officer was fully justified in treating the assessee as in default for short deduction of tax at source from the payments made to the consultant doctors and there was no infirmity in the impugned order of the learned CIT(A) upholding the action of the Assessing Officer on this count. The same is, therefore, upheld dismissing the appeal filed by the assessee. In the result, the appeal of the assessee is dismissed.
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