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2017 (1) TMI 249 - ITAT MUMBAITDS u/s. 194I - addition of short deduction determined on account of TDS payment made to Central Warehousing Corporation (CWC), Container Freight Station (CFS), Bombay Port Trust (BPT) and Airport Authority of India (AAI) for services rendered by such entities which included use of space for storage of imported/exported materials - Held that:- We approve the conclusion of CIT(A) that the payments made to CWC, CFS, BPT and AAI cannot be construed as ‘rent’ for the purposes of Sec. 194I of the Act. Thus, insofar as Ground of appeal nos. 1 and 2 are concerned, same are dismissed. TDS u/s 194J - survey fees paid by the assessee on which no tax was deducted at source - Held that:- No error on the part of CIT(A) because the payments have been made by the assessee in the capacity of an intermediary between its client exporter/importer and the recipients who have conducted the inspection of goods so as to facilitate customs clearance. The reasoning adverted by the CIT(A) is similar to that considered by us while dealing with the payments made to CWC, CFS, BPT and AAI and, therefore, the conclusion drawn by CIT(A) to the effect that assessee cannot be construed as an ‘assessee in default’ within the meaning of Sec. 201(1) and 201(1A) of the Act is hereby upheld TDS u/s 194J - internet charges paid by the assessee on which no tax was deducted at source - Held that:- The parity of reasoning laid down by the Hon'ble Madras High Court in the case of Skycell Communications Ltd. [2001 (2) TMI 57 - MADRAS High Court] eld that the mobile telephone facilities provided by the cell phone companies to their subscribers for making/receiving calls etc. cannot be construed as ‘technical services’ and thus, it cannot be brought into the ambit of Sec. 194J of the Act. In the present case, when the assessee is availing internet services from the broadband service provider, it does not entail that such broadband service provider is making available a ‘technical service’ so as to require the assessee to deduct tax at source u/s 194J of the Act. Therefore, we hereby affirm the order of CIT(A) on this aspect also TDS u/s 194C OR 194I - payment made towards hiring of Forklift/Cranes - Held that:- . Factually speaking, the payments have been made to the contractors for providing services of handling and transportation of cargo after the customs clearances were obtained. Such charges, inter-alia, entailed loading and unloading of cargo for which the contractors utilized Forklifts/Cranes being maintained by them. Quite clearly, assessee has not entered into any contract for hiring of Forklifts or Cranes, but it is a case where the contractor has utilized the same in discharge of his services to the assessee-firm. Therefore, in such a situation, it is not possible to conclude that assessee contracted for renting of Forklifts/Cranes so as to treat the payments as ‘rent’ for the purposes of Sec. 194I of the Act. CIT(A), in our view, correctly came to conclude that the payments have been made by the contractors against work executed on behalf of the assessee which clearly attracts deduction of tax at source u/s 194C of the Act and not u/s 194I of the Act, as contended by the Assessing Officer. Thus, on this aspect also Revenue fails. TDS u/s 194C OR 194J - payments made towards fumigation charges - Held that:- the plea raised by Revenue is without any basis. Factually speaking, it emerges from record that the persons entrusted with the job of fumigation carry out spraying of chemicals, etc. to prevent attack of pests so that cargo/goods being handled by the assessee do not get damaged. Ostensibly, the payments made by assessee would, inter-alia, include cost of chemicals, pesticides, etc. Apart from bald assertions, Revenue has not been able to demonstrate the use of any technical information or skill which is required to perform such fumigation activities and, therefore, invoking of Sec. 194J of the Act in the present case is unwarranted and has been correctly negated by the CIT(A). Thus, on this aspect also, Revenue fails.
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