TMI Blog2011 (11) TMI 865X X X X Extracts X X X X X X X X Extracts X X X X ..... two types of billing in this business and they are : (i) to be billed and (ii) to pay . In the (i) to be billed system, firstly the transporter is required to pay transportation charges to truck operators, partly as advance and partly, on receipt of material by party at destination or as per terms decided by them mutually and finally transporter will raise bill on party who has given transportation contract and get the payment. That in case of (ii) to pay system, transportation charges are payable to the truck operators by party at destination and transporter is entitled for commission only from truck operators. The net profit rate from to pay system works out 1.31 per cent on the receipt shown of ₹ 6,72,47,342 and the net prof ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... her with party at destination or truck operators/drivers and no money pass on to her mentioned under the head 'Amount paid' in TDS certificates thereof. She was entitled to get commission only from truck operators/drivers for arranging load for them and on furnishing proof of TDS made in her name against freight receivable to them, she had to make payment of TDS amount to them and she was entitled to claim credit of TDS made in her name under s. 199 of the IT Act. The appellant submitted that s. 198 falls under 'Chapter XVII' of the IT Act, 1961 which is titled as 'collection and recovery of tax'. That ss. 198 and 199 are machinery provisions, which deal with the collection and recovery of tax determined under oth ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ttled, income by way of commission from said transactions was duly reflected in books of account and payments of TDS amount to truck operators/drivers were made out of fund available in the books of account, no income can be deemed in her case under s. 198 on this account and she was entitled to claim credit of said TDS amount under s. 199. The assessee placed reliance on the following decisions. (i) Smt. Varsha G. Salunke v. Dy. CIT [2006] 98 ITD 147 (Mum.) (TM); (ii) Swastik Enterprises v. ITO [2001] 119 Taxman 69 (Hyd.) (Mag.); (iii) Dalmia Cement (Bharat) Ltd. v. Addl. CIT [2009] 32 SOT 164 (Delhi); (iv) Toyo Engg. India Ltd. v. Jt. CIT [2006] 5 SOT 616 (Mum.): (v) Escorts Ltd. v. Dy. CIT [2007] 15 SOT 368 (Delhi). I h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e No. 2 of assessment order of asst. yr. 2004-05). 2. The cases of asst. y₹ 2005-06 and 2006-07 were reopened under s. 147. The reassessment order has been passed on 30th Dec, 2010 wherein the AO after considering the aspect of s. 198 has not made addition as made in asst. yr. 2007-08. 3. Thus, prior and subsequent to the year under consideration, the AD has not made similar addition in scrutiny assessment while in the middle year, the addition has been made. The assessment order is against the rule of consistency. 4. Sec. 198 deals with collection and recovery of TDS. It is a machinery provision and does not deal with either computation or chargeability of income. Reliance on Smt. Varsha G. Salunke ( supra) (page No. 3 of as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the charging provisions to tax such deemed income as the income of the assessee, the provisions of s. 198 of the Act cannot by themselves create a charge on certain receipts. Further, it is an admitted proposition that the AO accepted the claim of the assessee both in earlier and later years; it is also noted that the AO refrained from making additions in the reassessment proceedings also. In such factual circumstances, considering the principles of consistency from the Revenue's point of view, we are of the opinion that the order of the CIT(A) does not call for any interference. Accordingly, the grounds raised by the Revenue are dismissed. 6. In the result, the appeal filed by the Revenue is dismissed. - - TaxTMI - TMITax - I ..... X X X X Extracts X X X X X X X X Extracts X X X X
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