TMI Blog2007 (7) TMI 643X X X X Extracts X X X X X X X X Extracts X X X X ..... made for that truck has to be treated as separate payment. In the present case, it is seen that the assessee engaged trucks through agents and suppliers and for each truck they have made separate payment because each truck was for separate destination. Therefore, in our considered view it cannot be said that there was contract between the suppliers and not with truck owners/drivers. Thus, it clearly seen that the contract was with the truck owners/drivers and not with the agents or suppliers. Therefore, in our considered view, the CIT(A) was justified in holding that the provisions of section 194C are not applicable on the facts of the present case. We have seen the detailed submissions filed on behalf of the assessee before the ld. CIT(A) as the same has been reproduced by the ld. CIT(A) in his order and found that the assessee has clarified each and every point and have met with the objections raised by the Assessing Officer successfully. Therefore, we confirm the findings of the ld. CIT(A). In the result, the appeal filed by the department is dismissed. - R.K. Gupta, Judicial Member And R.S. Syal, Accountant Member For the Appellant : T.M. Shivkumar. For the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g with the details of payments made to various truck owners. After considering the statement of Shri Rahul Agrawal and the explanations, the Assessing Officer found that the truck hired and payments made by the assessee are clearly as per sub-contractor payment agreement made by the assessee and each one is in excess of ₹ 20,000 in a year. Therefore, the assessee is liable to deduct tax at source as required under section 194C while making the said payments to the truck owners/suppliers. Assessee preferred appeal before the CIT(A). Detailed written submissions were filed before the CIT(A). Remand report was sought from the Assessing Officer by the CIT(A). Thereafter, the CIT(A) found that the provisions of section 194C are not applicable on the facts of the present case. Accordingly, he deleted the demand raised by the Assessing Officer. The findings of the ld. CIT(A) are given in paras 7 and 8 at pages 14 and 15 of his order which are as under: 7. I have carefully considered the written submissions and comments on Assessing Officer s reports as submitted by the appellant and its authorized representative and also the facts as per the impugned order and as per Assessing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the impugned order is directed to be deleted. 3. Now, the department, is in appeal here before the Tribunal. 4. The ld. DR, who appeared before the Tribunal strongly placed reliance on the order of the Assessing Officer. Attention of the Bench was also drawn on the order passed under section 201(1) and 201(1A). On the other hand, the ld. counsel of the assessee strongly placed reliance on the order of the CIT(A). Attention of the Bench was drawn on various details placed in the paper book. Reliance was also placed on the decision reported in 13 SOT 479 (Mum.) and it was submitted that the ratio of this decision is directly applicable on the facts of the present case as in this case also identical facts were involved. 5. We have heard rival submissions and considered them carefully. After considering the submissions and details, we find no infirmity in the findings of the ld. CIT(A). The main reason for holding that the assessee is in default for non-deduction of taxes in view of the provisions of section 194C was that the assessee hired trucks through suppliers and the Assessing Officer was of the view that the assessee had made payments to suppliers and not directly to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce it is found that there was no contract between the assessee and the agent but the contract was between the assessee and the truck owners/drivers, therefore, the details has to be filed in regard to payments made to truck owners/drivers and not of the suppliers. Nothing has been brought on record by the Assessing Officer that the certificates issued by these agents/suppliers are not correct. The statement of one Shri Rahul Agrawal was recorded during the survey proceedings and from the day one it has been stated, that : As soon as we have any requirement for a lorry or truck we contact in the market where according to destination trucks are available. The rates are negotiated and after deciding the rates, the truck is hired. This answer was given in question No. 4 at the time of survey. This is the part of the order of the Assessing Officer also. Again question was put that,- how do you determine the requirement of trucks on any given date? It was replied that : the requirements of truck are decided on the basis of requisition from client. Normally these clients are those to whom we have written agreement in a few cases ad hoc requirement is there. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t be a separate contract and all GR s relating to that period or quantity will be aggregated for the purpose of the TDS. 5.6 From this clarification by CDBT Circular No. 715 (supra), it became clear that if the contracts are between the truck owner/driver and GR is separate then the payment made for that truck has to be treated as separate payment. In the present case, it is seen that the assessee engaged trucks through agents and suppliers and for each truck they have made separate payment because each truck was for separate destination. Therefore, in our considered view it cannot be said that there was contract between the suppliers and not with truck owners/drivers. From the above discussion, it clearly seen that the contract was with the truck owners/drivers and not with the agents or suppliers. Therefore, in our considered view, the CIT(A) was justified in holding that the provisions of section 194C are not applicable on the facts of the present case. The decision relied upon by the ld. counsel of the assessee is also in favour of the assessee. 5.7 We have seen the detailed submissions filed on behalf of the assessee before the ld. CIT(A) as the same has been reproduce ..... X X X X Extracts X X X X X X X X Extracts X X X X
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