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2008 (8) TMI 413 - AT - Income TaxTDS u/s 194C - non deduction of tds on payment to truck drivers - disallowance u/s sec 40(a)(ia) - clubbing of payments - treating payments exceeding Rs. 20,000 - Agreement on principal-to-principal basis - HELD THAT:- On perusal of agreement on record reveals that the assessee was awarded a works contract by M/s Grasim Industries Ltd., a cement marketing division of M/s Aditya Cement Ltd. This agreement was on principal-to-principal basis whereby the appellant was awarded the cement transportation work and in terms of agreement the scope of work was to include placement of trucks for cement transportation from their plant on regular basis in the State of Rajasthan. In case the assessee failed to provide trucks as per contractual obligation, the company was free to hire trucks from market at prevailing prices and the amount of expenses incurred if any was to be debited to the assessee's account terming him to be a transporter. The assessee merely acted as an independent contractor while carrying on the aforesaid works contract awarded to it by M/s Grasim Industries Ltd. Admittedly, the appellant did not own trucks of its own for carrying out such transportation contract and has engaged the services of other truck owners/operators for lifting goods from the premises of M/s Grasim Industries Ltd. and transporting the same to various sites in Rajasthan. Goods receipt/bilty were prepared and the same was to be taken as a contract between the appellant and such truck owners/operators. In the light of clear provisions contained in s. 194C of the Act and having regard to the fact that both the amounts actually paid or credited or likely to be paid on account of each contract exceeded Rs. 20,000 on a single day, s. 194C has rightly been found applicable. We, therefore, do not find any wrong committed by the ld CIT(A) in holding that the assessee has committed default in making deduction with respect to clubbing of payments without deduction of tax at source. Keeping in view the overall conspectus of the case and finding no merit in the grounds raised in the appeal by the assessee, the same stand rejected and the appeal stands dismissed. In the result the appeal stands dismissed.
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