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2015 (5) TMI 111 - AT - Income TaxTDS on hiring of pipeline for transportation of gas - TDS u/s 194C or u/s 194I - Issue clarified in Circular no. 9/2012, dated 17-10-2012 - Held that:- It is an undisputed fact that Assessee has used the pipeline owned by GSPL for the transportation of gas. It is also a fact that the ownership of the pipeline always remained with GSPL and in possession of GSPL. We find that ld. CIT(A) while allowing the appeal of the Assessee has given a finding that the pipeline was used only for transmission of gas and did not give any inclusive right or interest to the Assessee. We further find that Circular No. 9/2012 dated 17.10.2012 issued by CBDT in the context of deduction of tax at source on payment of Gas Transportation Charges has clarified that in case transportation charges paid to a third party transporter of gas, either by the owner/ seller of the gas shall continue to be governed by the appropriate provisions of the act 1.e. 194C shall be deductible on such payments at the applicable rates. In the case of Kribhco Shyam Fertilizers Ltd. [2015 (3) TMI 490 - ITAT LUCKNOW], it was held that from Circular No. 9/2012 issued by CBDT it was clear that whenever gas is transported by seller to point of delivery, transportation charges of gas would be embedded in cost of gas, though transportation charges are claimed separately or along with cost of gas in sale bill and nature of such contract essentially remains a contract for sale and not a works contract - But wherever transportation of gas is made by third person apart from seller of gas, transportation charges paid by buyer to transporter shall be governed by provisions of section 194C - TDS shall be deductible on such payment to third party by buyer at applicable rates. Revenue has not brought any material on record to controvert the findings of CIT(A) nor has brought any contrary binding decision in its support. In view of the these facts, we find no reason to interfere with the order of CIT(A) and thus this ground of Revenue is dismissed. - Decided against the revenue.
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