TMI Blog2015 (3) TMI 193X X X X Extracts X X X X X X X X Extracts X X X X ..... a)(ia) of the Act will apply. See ITO Vs. MGB Transport [2013 (11) TMI 1321 - ITAT KOLKATA] - Decided in favour of revenue. - ITA No.1651/Kol/2012 - - - Dated:- 1-8-2014 - P K Bansal And Mahavir Singh, JJ. For the Appellant : Shri David Z Chawngthu, ACIT, Sr DR For the Respondent : None ORDER:- PER : Mahavir Singh This appeal by revenue is arising out of order of CIT(A)-XXX, Kolkata in Appeal No. 320/CIT(A)-XXX/Wd-43(1)/2011-12 dated 13.07.2012. Assessment was framed by ITO, Ward-43(1), Kolkata u/s. 143(3) of the Income-tax Act, 1961 (hereinafter referred to as the Act ) for Assessment Years 2009-10 vide his order dated 30.12.2011. 2. The only issue in this appeal of revenue is against the order of CIT(A) del ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the assessee being a middle man and not the utiliser of the transport facilities and hence, he is not liable to deduct TDS. The AO has not accepted the contention of the assessee and noted that the payments to the transporters were made by the assessee itself directly through its bank account to the transporter s bank account. Even on query, the assessee could not explain who are middle men, he could not reply. The AO has detailed out the transportation expenses to the following parties. Sl. No. Name of the Party Nature of Expenses Bill Amount (Rs.) 1. Metal Impex India Transportation 50,00,000/- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 75,00,000/- 3. Man sh Enterprise -do- 75,00,000/- 4. NavkarTrading -do- 18,00,000/- 5. Indian Corporation -do- 1,01,40,000/- 6. Brijesh Shyam Sunder -do- 14,68,822/- Total 3,34,08,822/- The A.O. has disallowed these payments holding that they were towards sub- contract payments to these parties towards transport contract and therefore these payments were covered the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o held in the above case that there was no contract between the assessee and owners of the truck to carry out any work and that the assessee had hired the trucks belonging to the truck owners for a fix period on payment of hire charges and that the trucks were put to use by the personnel of the assessee and nothing had been brought on record to show but manpower was provided along with the trucks to the assessee by the truck owners and it was finally held that entering into a contract for hiring of trucks was not equivalent to entering into a contract for carrying out any work and therefore provisions of section 194C were not attracted. 3.1 It is accordingly seen that the facts in the case of the Appellant are similar to the facts in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... C apply the provisions of 40(a)(ia) of the Act will apply. For this proposition, we are relying on the case law of the coordinate bench in the case of ITO Vs. MGB Transport in ITA No.2280/Kol/2010 for AY 2007-08 dated 15th March, 2013, wherein it is observed as under: We find that this issue is covered against the assessee by the decision of the Hon ble Karnataka High Court in the case of Smt. J.Rama - vs. - CIT (2010) 236 CTR (Kar.) 105, wherein it is held that law does not stipulate the existence of a written contract as a condition precedent for invoking the provisions of sect ion 194C of the Act with respect to payment of TDS. Hon ble Karnataka High Court concluded as under: - In order to provide vehicles to a cust ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... labour is recruited by the assessee through CDLB, but when this fact does not affect the nature of payment by the assessee to the CDLB which is admittedly in the nature of payment for supply of labour. The reasoning adopted by the Commissioner (Appeals), though somewhat impressive at first glance, is fallacious. There is no cause and effect relationship between workers assigned by the CDLB having employer workman relationship with the assessee, and the payments being made by the assessee to CDLB being not in the nature of 'payment for supply of labour . We find that the issue is squarely covered against the assessee and in favour of revenue, respectfully following the above case laws, we allow the appeal of revenue. 5. In the res ..... X X X X Extracts X X X X X X X X Extracts X X X X
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