Common area maintenance charges are contractual payments under section 194C, not rent under section 194I, when separately determined.

Where lease rent and common area maintenance charges are separately determined, and the maintenance charges arise from a distinct contractual service, TDS applies under section 194C rather than section 194I. The Tribunal followed its earlier decision on identical facts and treated rent and common area maintenance charges as separate payments, holding that the maintenance component was not part of the lease rent arrangement. The common area maintenance charges were therefore classified as contractual payments under section 194C, while rent continued to fall under section 194I.

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Issues: Whether common area maintenance charges paid by the assessee were taxable as rent under section 194I or as contractual payment under section 194C of the Income-tax Act, 1961.

Analysis: The Tribunal followed its earlier decision in the assessee's own case on identical facts and held that rent and common area maintenance charges are distinct. Rent was governed by section 194I, while common area maintenance charges, being separate from the lease rent arrangement and involving distinct maintenance operations, fell under section 194C.

Conclusion: Common area maintenance charges were held to be governed by section 194C, not section 194I.

Final Conclusion: The Revenue's challenge succeeded only to the limited extent of securing a direction for recomputation, while the substantive classification of common area maintenance charges was decided against the Revenue.

Ratio Decidendi: Where lease rent and common area maintenance charges are separately determined and the maintenance charges represent a distinct contractual service, TDS is attracted under section 194C and not under section 194I.

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