Strict construction of tax collection at source provisions excludes octroi collected by an agent or licensee.

Section 206C(1C) of the Income-tax Act is a fiscal provision requiring strict construction, and its language confines tax collection at source to specified receipts linked to parking lots, toll plazas, mines and quarries. Octroi is constitutionally and statutorily distinct from toll, and the Court held that the provision cannot be extended by implication to octroi collected by an agent or licensee on behalf of a municipal corporation. The question was answered in favour of the assessee and against the Revenue.

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Issues: Whether tax collection at source under Section 206C(1C) of the Income-tax Act, 1961 applies to octroi collected by an agent/licensee on behalf of a municipal corporation.

Analysis: Section 206C(1C) is a fiscal provision and is to be strictly construed. Its text confines the obligation to collect tax at source to receipts from rights transferred in relation to parking lots, toll plazas, mines and quarries. Octroi is constitutionally and statutorily distinct from toll: the Constitution separately recognises the power to levy octroi and to collect tolls, and the Maharashtra Municipal Corporation Act, 1949 separately enumerates octroi and toll. In a taxing statute, nothing can be added or implied beyond the language used, and the Court cannot extend the provision to transactions not expressly covered by the legislature.

Conclusion: Section 206C(1C) does not extend to octroi collected through an agent/licensee. The question was answered in favour of the assessee and against the Revenue.

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