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2006 (9) TMI 354 - ITAT MUMBAIDeduction of tax at source u/s 194C - transportation expenses incurred by the assessee - different freight payment in respect of different trips - stand of the assessee that it does not own any truck - hire the lorries - HELD THAT:- From the perusal of the details, we find that the frequency seems to be twice a month. It is a ground reality that where the assessee engaged in the transportation business does not own any truck, then it has to hire the truck from the market every time as and when there is a demand for the same. Merely because one particular truck was hired on certain occasions, it does not lead to conclusion that all the trips were made continuously under the specific contract. Admittedly, there is no specific contract brought on record. There is another important aspect which is noted from the details furnished before us that different freight is paid in respect of different trips even though the destination was the same i.e., Bangalore. Had there been a single contract, then assessee would not have paid different amounts in respect of different trips. This circumstance shows that different contract existed on different occasions when the trucks were hired. Therefore, in the absence of any material to prove that all the trips were made under a single contract, we are of the view that provisions of section 194C could not be invoked since payment for each trip was less than Rs. 20,000. In view of the same, the orders of the learned CIT(A) cannot be sustained and consequently the same are set aside. The demand of tax and interest raised against the assessee for all the years are, therefore, cancelled. The assessee shall be entitled to refund if any amount is paid by it to the Department. In the result, assessee’s appeals stand allowed.
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