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2019 (1) TMI 1294 - AT - Income TaxTDS u/s 194C OR 195 - payments made to the consortium - Short deduction of tax u/s 201(1) and Interest u/s 201 (1A) - Held that:- As decided in DCIT (TDS) ACIT, TDS AND JCIT, TDS, DEHRADUN VERSUS THE JOINT SECRETARY ORGANIZING COMMITTEE FOR WINTER GAMES [2018 (10) TMI 1174 - ITAT DELHI] in so far as the payments made to various parties which are public sector undertakings, the Tribunal dealt with such an issue at length and reached a conclusion that the matter needs to be set aside to the file of the learned AO with a direction to assessee to produce the bills etc. before the learned AO , who will examine them. It cannot be a reason for non-deduction of tax at source that recipient of the income have onward distributed the work to the sub contractors and recipient of the income have in turn deducted the tax at source on payment made by them to those sub- contractors. According to the provision of 194C of the Act even, the contractor is also required to deduct tax at source on payment made to their sub contractors. Thus we hold that payment made to the above parties are subject to tax deduction at source u/s 194C of the Act and assessee is liable to deduct tax at source u/s 194C of the Act. Therefore, to this extent we uphold the order of lower authorities. We direct the learned AO to delete the addition made u/s 195 of the Act in respect of the payments made to Snow Star SPA and M/s Pomagalski SA France We set aside the order u/s 201 of the Act with a direction that assessee may submit the requisite prescribed detail in specified manner before the ld Assessing Officer and then ld AO may decide the issue and, if found in accordance with the law, shall not treat the assessee in default u/s 201 of the Act. With respect to the interest u/s 201(1A) of the Act similar proviso is also added and AO may work out, based on the details furnished by the assessee, appropriate interest in accordance with law. Appeal of the assessee is partly allowed for statistical purposes.
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