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2015 (9) TMI 805 - HC - Income TaxDisallowance under section 40(a)(ia) - non deduction of tds - ITAT deleted the addition holding that the payment in question was not covered within the meaning of either Section 194(C) or Section 194(I) - whether the assessee was liable to deduct TDS while making payment to its sister concern in respect of equipments taken on lease by it from the sister concern either under section 194C or section 194I? - Held that:- Insofar as the applicability of section 194C of the Act is concerned, both, the Commissioner (Appeals) as well as the Tribunal have recorded a concurrent finding of fact to the effect that there was no contract between the assessee and its sister concern and that as and when such equipments were lying idle and the assessee needed them, the same were utilized by the assessee and payment was made to the sister concern. Therefore, the transaction was not in the nature of contract but was in the nature of lease agreement. As regards the applicability of section 194I of the Act, a perusal of the relevant statutory provisions as they stood at the relevant time reveals that section 194I did not include the words, "machinery and equipment" which were inserted only with effect from 14.7.2006. Under the circumstances, having regard to the fact that in the year under consideration the words "machinery and equipment" did not find place in section 194I of the Act, the same would not be applicable in the facts of the present case. Thus it cannot be said that the impugned order passed by the Tribunal suffers from any legal infirmity so as to give rise to any question of law - Decided in favour of assessee.
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