2011 (4) TMI 781

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.... and circumstances of the case, the Hon'ble Income Tax Appellate Tribunal is justified in law in holding that the provisions of Section 194C are not applicable on the payments of Rs.54,66,942/- made by the firm to its partners on account of transportation charges for use of trucks owned by the partners?   ii) Whether on the facts and circumstances of the case, the Hon'ble Income Tax Appellate Tribunal is justified in law in deleting the addition of Rs.51,61,183/- made in view of the provisions of section 40(a)(ia) of the Income Tax Act, 1961 as no tax at source was deducted by the firm as required under section 194C of the Income Tax Act, 1961?   3. The assessee is engaged in business of transport. It entered into a contract wit....

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.... for deduction of tax at source under section 194C of the Act.14. Further, in CIT Vs. Ambuja Darla Kashlog Mangu Transport Coop Society 2009) 31 DTR (HP) 49, it was held that the payment by Society/AOP to member truck owner is not a sub contract liable for deduction of tax at source u/s 194C(2) of the Act. Drawing strength from the ratio laid down by the Himachal Pradesh High Court in Sirmour Truck Operators Union Vs. CIT(supra) and Ambuja Darla Kashlog Operators Union Vs. CIT(supra), we hold that though the assessee firm and its partners are separate juristic identities but in the absence of any contract/sub contract between the two, wherein the assessee firm retains only 3% as commission and transfers the balance to the respective account....