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2005 (7) TMI 581 - AT - Income TaxInterest levied u/s 201(1A) - Non deduction of tax at source either u/s 194-I landing and parking charges Or u/s 194J in respect of navigational charges - Assessee-in-default - HELD THAT:- After considering the entire factual situation in the case of landing and parking of aircraft in the airport, a co-ordinate Bench of this Tribunal in the case of Japan Airlines [2004 (10) TMI 281 - ITAT DELHI-B], came to a conclusion that the International Airport Authority of India never intended to give out exclusive possession of any part of the landed property in relation to landing and parking area. Since the International Airport Authority of India granted permission for landing and parking without providing any exclusive right or interest in any specific portion of the land, the payment made by airline company cannot be construed as payment of rent. Therefore, the co-ordinate Bench of this Tribunal came to the conclusion that section 194-I is not applicable with regard to payment of landing and parking charges. However, the Delhi Bench of this Tribunal found that the payment attracts the provisions of section 194C since there was a contract between the assessee-company and the International Airport Authority of India. Therefore, the assessee is liable to deduct tax at the rate of 2%. By following the decision of Delhi Bench of this Tribunal in the case of Japan Airlines (supra) and for the very same reasons stated therein, we hold that the payment of landing and parking charges cannot be termed as payment of rent. Therefore, the provisions of section 194-I is not attract. As held by the Delhi Bench of this Tribunal, the payment attracts the provisions of section 194C. Therefore, the assessee is liable to deduct tax at the rate of 2%. Navigational facilities - In view of the clarification made by the learned counsel for the assessee that the assessee was in fact getting technical services apart from using the equipments for the purpose of communication between the aircraft and the air traffic controller, in our opinion, the provisions of section 194J would be applicable. Accordingly the assessee ought to have deducted tax as provided u/s 194J in respect of payment made for navigational facility. Application of section 201(1) and 201(1A) - Since the recipient company, admittedly, paid the tax, in our opinion, any further recovery from assessee would amount to double taxation which is not permissible under the Act. Accordingly, we hold that there is no justification to treat the assessee as assessee-in-default. When the Assessing Officer himself revised the order by making a rectification u/s 154, in our opinion, there is no justification on the part of the first Appellate Authority to restore the original order with respect to section 201(1). Levy of interest - Following the Gujarat High Court in the case of Rishikesh Apartments Co-operative Housing Society Ltd. [2001 (6) TMI 17 - GUJARAT HIGH COURT], we do not find any justification for levying tax till the month of October 1999. Since the actual date of payment of tax by the International Airport Authority of India is not available on the file of this Tribunal, the Assessing Officer may verify the actual date on which the taxes were paid by International Airport Authority of India and thereafter compute the interest from the date on which the deduction has to be made till the date of actual payment at the rate applicable as per the statutory provision. In the result, the order of the lower authority is set aside with regard to treating the assessee as assessee-in-default u/s 201(1) and levying interest u/s 201(1A). The Assessing Officer shall recompute the interest on the amount of tax as per the order of this Tribunal from the date on which deduction has to be made till the date of actual payment of tax by International Airport Authority of India after giving sufficient opportunity to the assessee in accordance with law. In the result, all the appeals filed by the assessee are partly allowed. However, there will be no order as to cost.
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