TMI Blog2016 (12) TMI 944X X X X Extracts X X X X X X X X Extracts X X X X ..... nstead of at the rate 10.33% as prescribed in sec.194J. The ld.CIT(A) held that the action of the AO cannot be faulted because the provisions u/s.194J is very clear to this effect. Thus assessee’s ground of appeal is dismissed by the ld.CIT(A). TDS u/s 194I - TDS on hiring expenses - Held that:- The assessee-company has already deducted and paid TDS u/s.194C of the Act. The A.O. in the order has stated that the assessee had agreed for this charge of levy TDS and interest thereon, the contest before the appellate authority became infructuous and the ground raised by the assessee was dismissed by the ld.CIT(A). - ITA No. 1791/Ahd/2011 - - - Dated:- 19-10-2016 - Shri Pramod Kumar, Accountant Member And Shri Mahavir Prasad, Judicial Member Assessee by : Shri M K Patel, AR Revenue by : Shri Rajesh Meena, Sr DR ORDER Per Mahavir Prasad, Judicial Member This appeal by the assessee is directed against the order of the Commissioner of Income-Tax (Appeals), Valsad dated 31.01.2011 for AY 2009-10. 2. The assessee has taken following grounds of appeal:- 1. On appreciation of the facts and circumstances of the case and law, the additions made by the Learned ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... penses - ₹ 3,72,192/- Ld. AO, therefore, concluded that the assessee-company has committed default of short deduction and non-deduction of tax at source and accordingly passed order u/s 201(1)/201(1A) of the Act, levying demand of ₹ 2,34,879/- u/s 201(1) and interest of ₹ 18,768/- u/s 201(1A) of the Act. 5. Aggrieved by the aforesaid order of the ld. AO, the assessee-company carried the matter in appeal before the ld. CIT(A) who, after considering the submissions of the assessee, confirmed the action of the Assessing Officer except the claim in respect of interest and bill discount expenses of ₹ 5,05,234/-. 6. Aggrieved by the order of the ld.CIT(A), the assessee is now in appeal before us. 7. Ground No.1 is general in nature requires no independent adjudication and therefore the same is dismissed. 8. With regard to the non-deduction of TDS from the expenditure of ₹ 8,02,459/- incurred for Effluent Treatment, ld. Counsel for the assessee contended that this payment made to Vapi Waste Effluent Management Company Limited for effluent treatment expenses which is covered under the definition of contract . Therefore, the action of the ld ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urt has held that the Sports Club is mutual concern and profit and gain is not assessable as business income. In view of the aforesaid judgements, ground No.2 of assessee s appeal is allowed. 11. With regard to legal professional charges of ₹ 7,22,275/-, ld. Counsel for the assessee contended that the details of such expenses for which the ld. AO has held that tax is deductible u/s 194J was not provided the assessee. It is also contended that the copy of accounts for the year ended on 31.03.2009 was already produced before the AO, wherein no such expenses was debited by the assessee during the year. 12. Ld. DR, on the other hand, supported the orders of the lower authorities. 13. We have heard the rival contentions, perused the material available on record and gone through the orders of the authorities below. We find that ld. CIT(A) confirmed the action of the ld. AO with regard to legal professional charges, by following observations:- 6.4 With respect to legal professional charges of ₹ 7,22,275/-, the AR of the appellant has submitted that the details of such expenses for which the LAO has held that tax is deductible U/s. 194I of the Income Tax Act ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... A) of the Act for the period fro 01/07/2008 to 28/02/2009 and assessee has also debited legal and professional charges of ₹ 7,22,275/- on which TDS u/s.194J is deductible @ 10.33%, which worked out at ₹ 74,394/-, whereas assessee has deducted u/s.194C and paid ₹ 11,613/- only. Thus, assessee paid less TDS of ₹ 62,781/-. The assessee has also accepted the default, the AO raised demand of ₹ 62,781/- and interest of ₹ 5,016/- u/s.201(1A) of the Act for the period from 01/07/2008 to 28/02/2009. The AO further observed that the assessee has debited rent hiring expenses of ₹ 3,72,192/- on which TDS u/s.1941 is deductible @ 15.45%, which worked out at ₹ 57,503/-, whereas the assessee has deducted u/s.194C and paid ₹ 7,667/- @ 2.06% only. Thus, assessee has deducted short TDS of ₹ 49,836/-. The assessee has accepted the default, the AO raised demand of ₹ 49,836/- and interest of ₹ 3,984/- u/s.201(1A) of the Act for the period from 01/07/2008 to 28/02/2009. The assessee made payment for Effluent Treatment Expenses to Vapi Waste Effluent Management Company Li8mtied (VWEMCL) that VWEMCL have provided an order dated 02.0 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... any during the year. Considering the facts of the case, it is requested to allow this ground of appeal. However, the AO stated that the appellant had debited Legal Professional Charges of ₹ 7,22,275/- for which the appellant had deducted TDS @ 2.06% by applying sec. 194C instead of at the rate 10.33% as prescribed in sec.194J. The ld.CIT(A) held that the action of the AO cannot be faulted because the provisions u/s.194J is very clear to this effect. Thus assessee s ground of appeal is dismissed by the ld.CIT(A). The ld.CIT(A) held with respect to hiring expenses of ₹ 3,72,192/- that the ld.AR of the assessee submitted that the said amount was incurred against the contract of providing plastic/tarpaulin sheets on rental basis so that the same can be used for protecting goods and other items from monsoon. The ld.AR of the assessee argued that the use of plastic sheet/tarpaulin is not covered under the provision of section 194I of the Act. The assessee-company has already deducted and paid TDS u/s.194C of the Act. The A.O. in the order has stated that the assessee had agreed for this charge of levy TDS and interest thereon, the contest before the appellate authority beca ..... X X X X Extracts X X X X X X X X Extracts X X X X
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