TMI Blog2018 (12) TMI 1581X X X X Extracts X X X X X X X X Extracts X X X X ..... ific destination and other liabilities attached with the said transportation on his own without consent of the truck owner. Hence it could be safely concluded that there is an oral contract entered into by the assessee with the ultimate truck owner during the medium of the truck drivers for which payments on account of transportation charges were made. Hence, we hold that the provisions of section 194C are applicable in the instant case and disallowance u/s 40a(ia) of the Act have rightly been made by the ld. AO. Accordingly, grounds raised by the revenue are allowed. - I.T.A No. 1479/Kol/2017 - - - Dated:- 19-9-2018 - Shri M.Balaganesh, AM Hon ble Shri S.S.Viswanethra Ravi, JM For the Appellant : Shri K. Mondal, Sr. DR Fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... revenue with a direction to pass a fresh assessment order and re-compute the assessee s income after making sufficient enquiry and giving due opportunity to the assessee. The ld. AO from the audited financial statements of Shree Balaji Road Lines observed that the assessee has paid transportation charges of ₹ 1,86,60,256/-; crane charges of ₹ 2,90,173/- and lifting charges of ₹ 3,92,971/- totaling to ₹ 1,91,59,588/-. On going through the profit and loss account of Shree Balaji Road Lines on account of total transportation expenses of ₹ 1,86,60,256/- being represented by Bawal Branch (Rs. 1,12,07,396/-); Rampur Branch (Rs. 37,93,981/-) Ghajiabad Branch (Rs. 36,58,879/-), the assessee furnished the truck wise ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... were made only to the truck drivers. Since there was no oral or written contract, the assessee pleaded that provisions of section 194C of the Act would not be applicable. It was also pleaded that the payments made to individual truck drivers never exceeded ₹ 20,000/- in a day. 4. The ld. AO found the aforesaid explanation of the assessee as not satisfactory and proceeded to make disallowance u/s 40a(ia) of the Act. The Ld. CIT(A) deleted the said disallowance by observing that the ld. AO had held the assessee liable for deduction of tax only on the assumption that assessee was having agreement with the parties through whom trucks were arranged for transportation of goods. He further observed that it was not established by the l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nly the truck owner as the truck driver cannot have the benefit of enjoying the said money. In other words, truck driver had only acted as a temporary custodian of the money paid by the assessee for onward transfer/payment to the ultimate truck owners. Hence effectively payments were made by the assessee only to the truck owners through the truck drivers. We are of the considered opinion that the truck driver cannot decide the entire terms and condition of the transport such as rate of freight, weight to be carried for specific destination and other liabilities attached with the said transportation on his own without consent of the truck owner. Hence it could be safely concluded that there is an oral contract entered into by the assessee wi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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