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2015 (7) TMI 1016 - AT - Income TaxLiability to deduct tax u/s 194J - demand raised by the AO vide order u/s.201(1)1/201(1A) - whether the payments made to Nhava Sheva International Container Terminal Private Limited are not in the nature of 'fees for professional services' but the payments are for carriage of goods and thus defined as 'work' in Explanation III to section 194C(2) of the Act, and hence the same are not covered under the provisions of section 194J? - direction of CIT(A) that payments made to NSICT be treated as covered under section 194C and not section 194J challenged - Held that:- assessee was making available the containers on customer's trailers / rail wagons, which were lifted from such trailers / rail wagons on the cranes by NSICT and were then moved from yard to vessel side.This movement of cargo is part of the journey of the container from the place of source to the place of destination, which is vessel. The assessee made payment for carriage of goods from the customer's trailers up to the vessel in case of export and vice versa in case of import of goods. This payment cannot be characterized as anything other than for the carriage of goods. When we view Explanation III (c) below section 194C(2) it becomes apparent that the payment made by the assessee to NSICT is covered within this provision and the assessee rightly deducted tax at source u/s. 194C of the Act. See ACIT Versus Merchant Shipping Services (P) Ltd. [2010 (11) TMI 692 - ITAT, Mumbai] We, therefore, hold that the payments made by the assessee to NSCIT are covered u/s 194C and there is no scope for applying the provisions of section 194J. The natural corollary is that the assessee rightly made deduction of tax at source at the applicable rate. - Decided in favour of assessee.
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