TMI Blog2023 (4) TMI 24X X X X Extracts X X X X X X X X Extracts X X X X ..... 01(1A) of the Act. Appeal filed by the assessee is allowed. - ITA No.1080/Del/2020 - - - Dated:- 20-2-2023 - Shri C.M. Garg, Judicial Member And Shri Pradip Kumar Kedia, Accountant Member For the Assessee : None For the Revenue : Shri Anuj Garg, Sr. DR ORDER PER C.M. GARG, JM: This appeal filed by the assessee is directed against the order dated 16.01.2020 of the CIT(A)-38, Delhi, relating to Assessment Years 2011-12. 2. The grounds of appeal raised by the assessee read as under:- 1. That the order of the learned CIT(A) is bad in law and on facts in confirming the order of AO in respect of following demands u/s 201(1) and u/s 201(1A) of the Income Tax Act, 1961:- TDS demand ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Form 26A u/s 201(1) r/w rule 31ACB and Rs. 18,511/- in respect of interest on short deduction by applying section 1941 instead of section 194C. 5. The appellant craves leave to add, modify, alter, substitute or delete any of the grounds of appeal on or before the date of hearing. 3. The ld. Counsel for the assessee submitted that the issue is covered by the decision of the coordinate Bench of the ITAT in the case of Kapoor Watch Company Pvt. Ltd., vide order dated 05.01.2021 in ITA No.889/Del/2020, for AY 2011-12. He has also placed reliance on the decision of the ITAT Delhi, SMC Bench dated 1st July, 2022 in the case of Nijhawan Travel Service (P) Ltd. vs. ACIT in ITA No.1417/Del/2020 for AY 2012-13. It was, therefore, submitte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n paras 11 to 13, the coordinate Bench of the Tribunal, by referring earlier judgment of the ITAT Delhi Bench in the case of Kapoor Watch Company Pvt. Ltd. (supra), held as under: 11. We shall now advert to the claim of the assessee that both the lower authorities had erred in law and the facts of the case in concluding that the CAM charges paid by the assessee to Ambience Group (supra) were liable for deduction of tax at source @10%, i.e., u/s 194-1 and not @2%, i.e., U/S.194C of the Act, as claimed by the assessee. Succinctly stated, the assessee company which is engaged, inter alia, in the business of running of fast food restaurants in North and East India under the brand name McDonalds , had taken shop/spaces/units in commercial ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... any other mode, whichever is earlier, deduct income-tax thereon at the rate of- (a) two per cent for the use of any machinery or plant or equipment; and (b) ten per cent for the use of any land or building (including factory building) or land appurtenant to a building (including factory building) or furniture or fittings: Provided that no deduction shall be made under this section where the amount of such income or, as the case may be, the aggregate of the amounts of such income credited or paid or likely to be credited or paid during the financial year by the aforesaid person to the account of or to, the payee, does not exceed one hundred and eighty thousand rupees: . . . Explanation.-For the purposes of this section, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as defined in Section 194C of the Act. In our considered view, as the CAM charges are not paid for use of land/building but are paid for carrying out the work for maintenance of the common area/facilities that are available along with the lease premises, therefore, the same could not be characterized and/or brought within the meaning of rent as defined in Section 194-1 of the Act. 13. In the backdrop of our aforesaid deliberations, we concur with the claim of the Id. AR that as the payments towards CAM charges are in the nature of contractual payments that are made for availing certain services/facilities, and not for use of any premises/equipment, therefore, the same would be subjected to deduction of tax at source u/s.194C of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... id observations set-aside the order of the CIT(A) who had approved the order passed by the AO treating the assessee company as an assessee-in-default u/s.201(1) of the Act. The Grounds of appeal no.4 to 4.5 are allowed in terms of our aforesaid observations. 7. In view of the foregoing discussion and factual position noted by us, which has not been controverted by the learned DR, I am in agreement with the claim of the learned AR that the payment towards CAM charges are in the nature of contractual payment which are made for availing services/ facilities and not for the use of any premises/ equipment, therefore, same would be subject to deduction of tax at source u/s 194C of the Act and not u/s 194I of the Act. This view has also been ..... X X X X Extracts X X X X X X X X Extracts X X X X
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