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Commissioner of Income Tax (TDS) Chandigarh Versus DAV College, Sector-10, Chandigarh

2016 (1) TMI 580 - PUNJAB AND HARYANA HIGH COURT

TDS u/s 194J or 192 - whether relation with Guest Faculty (professional teaching staff) is equivalent in nature to an employer/employee relationship? - Held that:- This Court in M/s Ivy Health Life Services Pvt. Ltd.'s case (2015 (12) TMI 1063 - PUNJAB AND HARYANA HIGH COURT) held that it was required to be seen whether the agreement between the assessee and the concerned doctors was a 'contract for service' or a 'contract of service'. In case, it is 'contract for service', the income of the doc .....

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ployer-employee relationship. Such relationship depends upon several factors taken together. Even the Apex Court in Workmen of Nilgiri Coop. Market Society Limited v. State of Tamil Nadu and others, (2004 (2) TMI 688 - SUPREME COURT) observed that the question whether the relationship between the parties is one of the employer and employee is a pure question of fact. The control test and the organization test are not the only factors whereas several other factors viz. who is the appointing autho .....

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id down by this Court in M/s Ivy Health Life Sciences Pvt. Ltd., Mohali, Punjab's case (supra) and after hearing the parties and by passing a speaking order in accordance with law. - ITA No. 120 of 2015 - Dated:- 3-12-2015 - MR. AJAY KUMAR MITTAL AND MR. RAMENDRA JAIN, JJ. For The Appellant : Mr. Denesh Goyal, Advocate For The Respondent : Mr. Maninder Arora, Advocate AJAY KUMAR MITTAL, J. 1. This order shall dispose of a bunch of three appeals bearing ITA Nos. 120, 122 and 123 of 2015 as accord .....

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ear 2010-11, claiming the following substantial questions of law:- (i) Whether on the facts and circumstances of the case and in law, the Ld. ITAT was justified in holding that the relation with Guest Faculty (professional teaching staff) is equivalent in nature to an employer/employee relationship when there was no agreement/appointment or employer-employee relationship between the parties and that the Guest Faculties were merely professionals and therefore Section 194J of the Act was applicabl .....

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chers and the College and the assessee-college is not liable to make deduction of tax at source u/s 194J of the Income Tax Act, 1961? (iv) Whether on the facts and in the circumstances of the case the findings recorded by the Ld. ITAT are perverse and contrary to the material available on record and not sustainable in the eyes of law? 3. A few facts necessary for adjudication of the instant appeal as narrated therein may be noticed. The assessee is a college, imparting education in various subje .....

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teaching self-financing and other professional courses run by the assessee. The payment to guest faculty was made on the basis of lectures delivered by the guest faculty and not the pay scales as in the case of regular employees. Since the payments made were exceeding ₹ 20,000/-, the assessee was required to deduct the tax at source as envisaged under Section 194J of the Act. Accordingly, a show cause notice dated 28.2.2012 was issued to the assessee treating it as person-in-default under .....

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guest faculties because there existed a relationship of employer and employee and the payment made to the guest faculty is a salary and also below the taxable limit. The CIT(A) vide a consolidated order dated 31.1.2014 (Annexure A-2) for the assessment years 2009-10, 2010-11 and 2011-12 allowed the appeals holding that the Assessing Officer was not right in treating the assessee in default under Section 201(1)/201(1A) of the Act for not deducting tax at source under Section 194J of the Act. Aga .....

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the guest faculty. The Tribunal vide order dated 8.8.2014 (Annexure A-3) affirmed the order of the CIT(A) and dismissed the appeals. Hence, the present appeals by the revenue. 4. Learned counsel for the appellant-revenue submitted that whether the agreement between the respondent-assessee and the guest faculty lecturers engaged by the college-assessee was a 'contract for service' or a 'contract of service' would be a question of fact dependent upon appreciation of various factors .....

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vices Pvt. Ltd.'s case (supra). It was, thus, contended that in such circumstances it would be just and appropriate that the matter is remitted back to the Tribunal to decide afresh keeping in view the principles of law laid down in M/s Ivy Health Life Services Pvt. Ltd.'s case (supra). 5. On the other hand, learned counsel for the respondentassessee supported the order passed by the Tribunal. 6. We have heard learned counsel for the parties and find force in the submissions of learned c .....

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alary which is dependent upon masterservant relationship. It is always a vexed question to determine whether employer-employee relationship exists between the parties or not. There is no strait jacket formula prescribed under any statute or by any pronouncement on the basis of which it could be said that in a given eventuality, it would be characterized as employer-employee relationship. Such relationship depends upon several factors taken together. Even the Apex Court in Workmen of Nilgiri Coop .....

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t is professional or skilled work; nature of establishment and the right to reject, are also required to be scanned before arriving at the conclusion of the employer-employee relations. This Court had recorded as under:- 9. To resolve the controversy raised in these appeals, necessarily, it will be required to be seen whether the agreement between the assessee and the concerned doctors was a 'contract for service' or a 'contract of service'. In case, it is 'contract for servi .....

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