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2010 (4) TMI 295 - HC - Income TaxDeduction of TDS u/s 194C – demand u/s 201(1) - Income Tax Officer (TDS), Hisar, noticed that the assessee-General Manager, Haryana Roadways, Hisar, entered into a contract with the Haryana Roadways Engineering Corporation Limited, Gurgaon (HRECL), for fabrication of bodies of buses but failed to deduct tax at source under Section 194C of the Act - The Income Tax Officer (TDS), Hisar, treated the assessee in default and raised a demand of Rs. 76,120/- in respect of the Financial Year 2006-07, vide order dated 29.8.2008, passed under Section 201(1) & 201(1A) of the Act (A-1).- ITAT held that it is not a works contract liable to TDS u/s 194C but it is a sale transaction – ITAT observed that From the facts narrated by the department itself, it is clear that Haryana Roadways Engineering Corporation Ltd., Gurgaon manufactured and fabricated the bus bodies as per specification given by the Transport Commissioner and Secretary (Transport) to Govt. of Haryana and the ownership of the vehicle passed on to the Govt. of Haryana through Transport Commissioner and Secretary (Transport) after full payment is made by Transport Commissioner, Haryana Roadways. The manufacturer and fabricator of the bus bodies also charged sales tax and VAT as applicable – Held that: - that there is no merit in these appeals warranting their admission and the same are liable to be dismissed. From the categorical findings it is evident that Haryana Roadways did not purchase any bus chasis and, therefore, there was no question of any contract between Haryana Roadways through its Transport Commissioner and Haryana Roadways Engineering Corporation Limited. It is a simple case of supply of buses by the Haryana Roadways Engineering Corporation Limited to the Haryana Roadways. – in favor of assessee
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