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2007 (7) TMI 643 - AT - Income TaxNon deduction of TDS u/s 194C - hiring charges - Demand raised u/s 201(1) and 201(1A) - HELD THAT:- We find no infirmity in the findings of the ld. CIT(A). The main reason for holding that the assessee is in default for non-deduction of taxes in view of the provisions of section 194C was that the assessee hired trucks through suppliers and the Assessing Officer was of the view that the assessee had made payments to suppliers and not directly to the truck owners. The Assessing Officer was also of the view that if the cumulative figures of payment are taken into consideration then the payments exceed ₹ 20,000. Since no details in regard to suppliers/agents were filed, therefore, the Assessing Officer estimated 90 per cent of the total payment and held that they are in violation of the provisions of section 194C. From this clarification by CDBT Circular, it became clear that if the contracts are between the truck owner/driver and GR is separate then the payment made for that truck has to be treated as separate payment. In the present case, it is seen that the assessee engaged trucks through agents and suppliers and for each truck they have made separate payment because each truck was for separate destination. Therefore, in our considered view it cannot be said that there was contract between the suppliers and not with truck owners/drivers. Thus, it clearly seen that the contract was with the truck owners/drivers and not with the agents or suppliers. Therefore, in our considered view, the CIT(A) was justified in holding that the provisions of section 194C are not applicable on the facts of the present case. We have seen the detailed submissions filed on behalf of the assessee before the ld. CIT(A) as the same has been reproduced by the ld. CIT(A) in his order and found that the assessee has clarified each and every point and have met with the objections raised by the Assessing Officer successfully. Therefore, we confirm the findings of the ld. CIT(A). In the result, the appeal filed by the department is dismissed.
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