TaxTMI 
TaxTMI 
2012 (12) TMI 444
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....ns were trading/purchases but before the Ld. CIT(A) the assessee has provided various details in the form of paper book which the Ld. CIT(A) has admitted in violation of Rule 46A of the I.T. Rules. c) On the facts and in the circumstances of the case and in law, the Ld. CIT(A) has failed to appreciate that details placed before the Ld. CIT(A) were in the nature of additional evidences which were never submitted before the assessing Officer. So the exact nature of transaction i.e. whether it is contract / for work or contract for sale of goods remained for verification. Ld. CIT(A) has violated the Rule 46A of I. T. Rules by not according an opportunity to A.O. before admitting additional evidences. d) On the facts and in the circumstances of the case and in law, the Ld. CIT(A) has failed to appreciate that Sec. 9(1) stipulates the deeming provisions for income to accrue or arise in India all such income arising directly or indirectly through any business connection in India, or through or from any property in India or from any asset or source of income in India and therefore erred in concluding that payment has been made out of India and services have been rendered out of I....
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.... During the survey, the appellant was also asked whether tax is being deducted on products purchased for trading activity as probably the ITO was of the view that these purchases were covered u/s 194C. To this, the appellant had replied vide letter dated 10.12.2008 and submitted that the appellant felt that there was some misconception on the part of ITO. In case of these purchase transactions, the vendors had charged Excise Duty, Sales Tax, VAT and other applicable levies on the sales value and hence such purchases were not covered u/s 194C of the Act. In spite of all these clear facts, the ITO has described a contract between the appellant and one Job Worker Shiel Industries in detail in the assessment order (which has no relation with transactions of Trading goods purchased). This was a pure job work contract and tax was deductible u/s 194C on the relevant job work charges. They wer appropriately deducted by the appellant. Based on this contract the ITO has tried to justify that all the trading purchases, which are not in the nature of job work, were also liable to deduction of tax u/s 194C. He totally ignored the fact that on all the job work charges the appellant has deducted....
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....he interpretation of agreement with M/s. Shiel Industries which is a job work party. There is no doubt that in case of job work, TDS under section 194C is deductible and the appellant has deducted the applicable TDS. However, what is the subject matter of appeal is whether TDS is deductible on purchase of trading goods both local and import. From the details submitted by the appellant and on perusal of factual position, it becomes clear that the assessee has effected purchases of goods for trading of Rs. 27.39 crores in India. Since the transaction is purely of purchases, TDS is not deductible under section 194C of the Income Tax Act, 1961. The case of the appellant is squarely covered by the decision of Hon'ble jurisdictional Bombay High Court in the case of BDA Ltd. vs. ITO (TDS) (2006) 281 ITR 99 (Bom). In view of the above, I hold that no TDS is deductible on purchase of trading goods of Rs. 27.39 crores. Since no TDS is deductible, no surcharge and education cess is leviable on such TDS and further no interest can be levied u/s 201(1)(1A). The AO is directed accordingly. With regard to purchase of trading goods from abroad of Rs. 23.03 crores, TDS is not deductible for the s....
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....n of the ITO that all purchases too must be brought under the TDS net. The assessee, from its extensive details has submitted before the ITO (TDS) the quantum of domestic purchases and quantum of imported purchase on which other statutory levies had been paid. We, therefore, endorse the decision of the CIT(A) in deleting the addition made by the ITO u/s 201(1) and 201(1A). 9. The ground of appeal by the department, is thus rejected. 10. Grounds no. (b) and (c) could not be seen to be arising from the impugned order of the CIT(A) and even the DR was unable to show the issue involved and apprise us as to what was the material that was put before the CIT(A), which was not before the ITO (TDS). Actually the AR pointed out that written submissions and details placed before the ITO are placed in the paper book at pages 4, 10, 12 and 14 dated 06.10.2008, 14.10.2008, 14.10.2008 and 14.11.2008. Since all the details are already before the ITO, we do not find any justification in upholding these grounds, we reject them. 11. Grounds no. (d) and (e) are on the TDS not deducted u/s 194J for payments made outside India for services rendered outside India. 12. Before us, ....