TaxTMI 
TaxTMI 
2005 (10) TMI 229
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....on order, for the sake of convenience, because the issues involved in the grounds of appeal are identical. 2. In all its appeals, the Revenue has taken the following identical grounds: "On the facts and in the circumstances of the case, learned CIT(A) erred: (i) in holding that the payment of ocean freight was not liable for TDS under s. 194C of the IT Act, in view of provisions of s. 172 of the Act in spite of the fact that the assessee despite sufficient opportunity failed to prove that payments of freight were made to non-resident shipping companies or their agents so as to be covered under s. 172 of the Act; and (ii) in holding that inland haulage charges are covered under sub-s. (8) of s. 172 of the Act an....
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....he CIT(A) and contended that no tax is deductible on the payments because of the provisions of s. 172 and s. 194C are not at all applicable in its case. The assessee relied upon the Board's Circular No. 723, dt. 19th Sept., 1995 [(1995) 128 CTR (St) 6] in support of its contention. Further according to the assessee Circular No. 723, dt. 19th Sept., 1995 has put the agents of foreign shipping line into their shoes for the purpose of deduction of TDS on ocean freight, etc. The assessee-company has submitted confirmations from sub-agents for being agents of the respective shipping lines. The assessee further contended that the demurrage/handling charges are not at all charges for carriage of goods by ship but paid for services rendered loc....
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....nsignee is the responsibility of the shipping line or their agents. All agents of the foreign shipping lines are also confirming that they are filing the returns under s. 172 and including the inland haulage in these returns. In view of this fact, singling out inland haulage charges for deduction of tax at source under s. 194C is not justified and the learned ITO has erred in doing the same. 6. On considering the submissions, the CIT(A) while passing a detailed order and reversing the order of the AO held that the assessee could not be treated as an assessee in default and hence cancelled the order of the AO. 7. Before us, the learned Departmental Representative for the Revenue, placed reliance on the reasoning given in the order of t....
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.... non-resident ship owners or charter ship at a port in India, provisions of s. 172 will apply because the agent steps into the shoes of the principal. However, the problem arises only when restrictive interpretation is placed on the Board's circular referred to hereinabove when the AO has sought to draw distinction on the basis of the status of the agents. We would like to mention that even if the agent is to be treated as resident, by virtue of his acting on behalf of non-resident shippers or charters, he receives payments primarily on behalf of his principal, i.e., non-resident ship owners or ships charters shipped at a port in India. In our opinion, even if these amounts are inclusive of small element of the amounts that ultimately m....