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2018 (5) TMI 152 - HC - Income TaxNot deducting TDS u/s 194J - assessee in default - payment for service charges - whether the payments made by the assessee to M/s. Hospet Steel Limited are reimbursement of expenses on cost to cost basis and does not constitute income component? - Held that:- As in Hyderabad Industries Ltd., Vs Income Tax Officer and Another (1991 (1) TMI 134 - KARNATAKA High Court) held that, “an amount which will not be included in the total income of a person cannot be considered as “income” for the purpose of deduction of tax at source at all. The purpose of deduction of tax at source is not to collect a sum which is not a tax levied under the Act, it is to facilitate the collection of tax lawfully leviable under the Act.” In view of the factual finding of the appellate authorities that the payment made by KSL and ML to HSL for various expenses incurred would be a reimbursement and not a fee for technical services, Section 194J is not attracted. Assessee falls outside the scope of Section 194J r/w Section 200 of the Act during the relevant assessment years. Consequently, the provisions of Sections 201 and 201(1A) of the Act are not attracted. We do not find any material irregularity or infirmity in the orders passed by the appellate authorities. - Decided in favour of assessee
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