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2016 (4) TMI 426 - ITAT PUNE

2016 (4) TMI 426 - ITAT PUNE - TMI - TDS u/s 194C - Whether on the payments made for hiring of machinery, cranes etc., the tax at source is to be deducted under the provisions of section 194C or section 194I? - Held that:- Tribunal in the case of Bharat Forge Ltd. Vs. Addl. CIT (2013 (11) TMI 1263 - ITAT PUNE ) in a similar case has held that on the payments made for hiring of cranes, the provisions of section 194C would apply. In the said case contractor was to bear the expenses for petrol, ope .....

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ted 10-04-2013 passed u/s. 201(1) and 201(1A) of the Income Tax Act, 1961 (hereinafter referred to as the Act ) for the assessment year 2009-10. 2. The only issue raised by the Revenue in appeal is : 1. On the facts and in the circumstances of the case and in law, the learned CIT(A) erred in holding that the provisions of section 194I are not applicable in respect of crane hire charges without appreciating the fact that as per the amended provisions of section 1941 w.e.f. 13-07-2006, the rent in .....

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de for hiring of the above machines, the assessee deducted tax at source under the provisions of section 194C @ 1.22%. The Assessing Officer held that on payments made for hiring the machines, the assessee should have deducted tax at source under the provisions of section 194I @ 11.33%. For the short deduction of tax at source on the above payments, the Assessing Officer raised the demand of ₹ 9,36,182/- u/s. 201(1) and 201(1A) of the Act. Aggrieved by the order dated 21-03-2011 passed u/s .....

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urt in the case of CIT Vs. Swayam Shipping Services (P) Ltd. in Income Tax Appeal No. 1037 of 2009 reported as 339 ITR 647 (Guj.). Against the findings of Commissioner of Income Tax (Appeals), the Revenue is in appeal before the Tribunal. 4. Dr. Subhash K.R. representing the Department submitted that the Commissioner of Income Tax (Appeals) has erred in coming to the conclusion that on the payments made for hiring of excavation machinery and cranes the tax at source has been rightly deducted und .....

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ppeals) on the issue. 5. On the other hand Smt. Deepa Khare appearing on behalf of the assessee submitted that admittedly there is no written contract between the assessee and M/s. Siddhivinayak Earth Movers. However, the facts of the case would clearly establish that the assessee is using cranes and other earth moving equipments/machinery on contractual basis. The supplier of machinery is bearing the cost of repair and maintenance of the machinery, salary of the operator, fuel expenses etc. The .....

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ddl. CIT in ITA No. 1357 & 1358/PN/2010 for the assessment years 2007-08 and 2008-09 decided on 31-01-2013. 6. We have heard the submissions made by the representatives of rival sides and have perused the orders of the authorities below. The only issue in the appeal is; Whether on the payments made for hiring of machinery, cranes etc., the tax at source is to be deducted under the provisions of section 194C or section 194I of the Act. 7. The assessee had hired machinery, JCB, Poclain etc. fo .....

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oric finding that the operator was required to maintain the equipment and bear the cost of repair, driver, fuel etc. The ld. AR has drawn our attention to letter dated 28-03-2013 written by M/s. Siddhivinayak Earth Movers to the Commissioner of Appeals placed on record at page 3 of the paper book. It has been specifically stated in the letter that M/s. Siddhivinayak Earth Movers has incurred expenses towards fuel, driver salary, repair and maintenance etc. and the bills were raised on the basis .....

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in the responsibility of maintenance and repair of the machinery, payment of driver salary, fuel etc. is that of supplier. The Revenue has not rebutted the evidence furnished by assessee in support of its claim. 9. The Co-ordinate Bench of the Tribunal in the case of Bharat Forge Ltd. Vs. Addl. CIT (supra) in a similar case has held that on the payments made for hiring of cranes, the provisions of section 194C would apply. In the said case contractor was to bear the expenses for petrol, operator .....

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ction 194C or 194I on account of payments for hiring of cranes for loading and unloading of material at its factory when the cranes are provided by the parties along with driver/operator and all expenses are borne by the owners only. We find the Hon ble Gujarat High Court in the case of Shree Mahalaxmi Transport Company (Supra) has discussed an identical issue and has observed as under : Chapter XVII of the Income-tax Act, 1961, makes provision for collection and recovery of tax. Part B thereof .....

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eque or draft or by any other mode, whichever is earlier, deduct an amount equal to the percentage specified thereunder of such sum as income-tax on income comprised therein. Section 194-I of the Act which bears the heading Rent provides that any person, not being an individual or a Hindu undivided family, who is responsible for paying to a resident any income by way of rent, shall, at the time of credit of such income to the account of the payee or at the time of payment thereof in cash or by i .....

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ner (Appeals) it is apparent that the assessee has not taken the dumpers on hire/rent from the parties in question. The assessee has given contracts to the said parties for the transportation of goods and has not taken machineries and equipment on rent. In the circumstances, the Commissioner (Appeals) was justified in holding that the transactions in question being in the nature of contracts for shifting of goods from one place to another would be covered as works contracts, thereby attracting t .....

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s committed any legal error so as to warrant interference. No question of law, much less, a substantial question of law can be stated to arise out of the impugned order of the Tribunal. The appeal is, accordingly, dismissed. 18.1 We find the Hon ble Gujarat High Court in the case of Swayam Shipping Services (P) Ltd. (Supra) has held as under (short notes) : Held, dismissing the appeal, that there was nothing to indicate that the assessee had taken trailers/cranes on rent so as to attract the pro .....

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