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TMI Blog2013 (1) TMI 592X X X X Extracts X X X X X X X X Extracts X X X X ..... as required to deduct tax at source on such payments and the assessee having not made such payments, held that by virtue of section 40(a)(ia) of the Act, such expenditure should be disallowed. The matter was carried in appeal before the Commissioner (Appeals) by the assessee. The Commissioner (Appeals) turned down the assessee's appeal, upon which he approached the Tribunal. The Tribunal allowed the appeal. 2.2 The Tribunal noted that a contract was awarded to M/s. Petronet LNG Ltd for construction of peripheral and approach roads at LNG terminal, Dahej. The contractor M/s. Petronet LNG Ltd. had entered into a sub-contract with M/s. ANS Construction Ltd. M/s. ANS Construction Ltd, in turn, entered into another sub-contract with the respondent-assessee. The work of the assessee, therefore, pertained to construction of peripheral and approach roads. To carry out such work, the assessee had to purchase construction materials such as sand, gravels etc. To transport such construction material at the site at Dahej, the assessee had availed the services of other transporters and made payments to such transporters under the head transport charges, total of which came to Rs. 71,00,339/-. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... te Government; or (b) any local authority; or (c) Any corporation established by or under a Central, State or Provincial Act; or (d) Any company; [or] (e) Any co-operative [society; or] (f) Any authority, constituted in India by or under any law, engaged either for the purpose of dealing with and satisfying the need for housing accommodation or for the purpose of planning, development or improvement of cities, towns and villages, or for both; or (g) Any society registered under the Societies Registration Act, 1860 (21 of 1860) or under any law corresponding to that Act in force in any part of India; or (h) Any trust; or (i) Any University established or incorporated by or under a Central, State or Provincial Act and an institution declared to be a University under section 3 of the University Grants Commission Act, 1956 (3 of 1956); or (j) Any firm, shall, at the time of credit of such sum to the account of the contractor or at the time of payment thereof in cash or by issue of a cheque or draft or by any other mode, whichever is earlier, deduct an amount equal to - (i) One per cent in case of advertising, (ii)&n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ransport other than by railways; (d) Catering. (3) No deduction shall be made under sub-section (1) or sub-section (2) from - (i) the amount of any sum credited or paid or likely to be credited or paid to the account of, or to, the contractor or sub-contractor, if such sum does not exceed twenty thousand rupees. Provided that where the aggregate of the amounts of such sums credited or paid or likely to be credited or paid during the financial year exceeds fifty thousand rupees, the person responsible for paying such sums referred to in sub-section (1) or, as the case may be, sub-section (2) shall be liable to deduct income-tax [under this section] Provided further that no deduction shall be made under sub-section (2) from the amount of any sum credited or paid or likely to be credited or paid during the previous year to the account of the sub-contractor during the course of business of plying, hiring or leasing goods carriages, on production of a declaration to the person concerned paying or crediting such sum, in the prescribed form and verified in the prescribed manner and within such time as may be prescribed, if such sub-contractor is an indiv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tax is deductible at source under Chapter XVII-B and such tax has not been deducted or, after deduction, has not been paid during the previous year, or in the subsequent year before the expiry of the time prescribed under sub-section (1) of section 200;" 7. In the present appeal, we are principally concerned with the interpretation of section 194C of the Act as such provision stood at the relevant time. Sub-section (1) of section 194C, required that any person responsible for paying any sum to any resident for carrying out any work in pursuant to a contract between the contractor and entities specified in clause-(a) to (j) would have to, at the time of crediting such sum to the account of the contractor or at the time of payment in cash or by cheque or draft or any other mode, deduct a specified amount of tax at source. Till clause (k) was introduced in sub-section (1), the category of individual, HUF or AOP was not included. Such amendment was made with effect from 1st June 2007 and obviously, therefore, would not apply to the case on hand. The Tribunal, therefore, correctly came to the conclusion that the case of the assessee was not covered under section 194C(1) of the Act sinc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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