TaxTMI 
TaxTMI 
2020 (2) TMI 19
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....e has raised mainly two grounds, which read as under: "1. The Ld. CIT(A) has erred on facts and in law in deleting the additions made u/s, 206C(A)/206C(7) of the IT Act on non collection of TCS of Rs. 15,40,67,019/- on sale of DOC, Maize husk and cotton waste Inspite of the fact that the provisions of section 206C(1) apply to the assessee. 2. The Ld CIT(A) has erred on facts and in law in deleting the additions made u/s. 201(1)7201(1) of the IT Act on short deduction of tax at source of Rs. 3,50,05,547/- by applying provisions of section 194C of the IT Act instead of 194J of the IT Act on payments made to C&F Agents." 3. Brief facts emerging from the record are that assessee is an agro-processing industries engaged in manufacturing ....
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....ead of 194J on payment made to C&F Agents is concerned, they are providing helping services at the ports and therefore they are contractors and not professionals, and therefore, provisions of section 194J did not applicable to the case of the assessee. However, the ld.AO did not buy explanation of the assessee, and based on his decision for the assessment years 2009-10 to 2012-13, held the assessee to be assessee-in-default and raised demand vide the impugned order. Thereafter, assessee went in appeal before the ld.CIT(A), deleted allowed the claim of the assessee and deleted the demand. Revenue is now before the Tribunal. 4. At the outset, the ld.counsel for the assessee submitted that both issues involved in the Revenue's appeal have be....
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....o by the C1T(A), I find no reason to differ and agree with the findings in above order of CIT(A) and ITAT that DOC (de-oiled Cake) is a by product and cannot be categorised as scrap and waste. In case of raw cotton, I agree that in case of the appellant such raw cotton does not arise from manufacturing or mechanical working and is merely a segregation of raw material. Similarly, maize husk fibre cannot be considered as a waste or scrap within the manufacturing process as it is subjected to various manufacturing stages and is a by - product. In view of above discussion Ground No.2 & 3 are allowed as the items, DOC, Raw cotton waste and maize husk are not in the nature of scrap within the meaning of provisions of section 206C of IT Act. Th....
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....s for breakup of payments made to C&F agents before the lower authorities. Such breakup includes all such expenditure which were in the nature of reimbursement and the agency charges by such C&F agents. For the total payments made to C&F agents, the assessee has deducted TDS u/s 194C or at a lower rate if such C&F agent has provided certificate of tax deduction at source at lower rate issued by their respective Assessing Officers. For example, for AY 2008-09, the detailed breakup of port charges is evident from the details narrated as under:- ..... ..... ...... ..... ..... ...... From the aforesaid table, it is clear that for AY 2009-10 the assessee has made payments four C&F agents as is evident from the tabular sheet. The payment....
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....ofession or the profession of accountancy or technical consultancy or interior decoration or advertising or such other profession as is notified by the Board for the purposes of section 44AA or of this section;" 7. In this background, CIT(A) rightly found that C&F agents were nowhere remotely indicated in the explanation to section 194J of Income tax Act nor has been explained by the AO that how C&F was covered u/s. 194J of the Income-tax Act. Therefore, under the given facts and ITA Nos. 1542-1545 & CO No.183-186/Ahd/2013 Assessee : Gujarat Ambuja Exports Ltd AY : 2009-10 to 2012-13 circumstances of the case, the CIT(A) was justified in holding that the action of Assessing Officer invoking provision u/s 194J in respect to port charges p....