TaxTMI 
TaxTMI 
2013 (3) TMI 287
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.... under Technical Service U/s 194J. On the facts of case, the Pilotage contract is liable to TDS u/s 194C of the Income Tax Act and TDS cannot be once again recovered where the proper tax has been paid by the payee on such income. 3. Ld.CIT(A) has erred in facts and in law by treating the Taxi &Tug Hire Charges which is otherwise liable to TDS u/s 194C as liable under Rent u/s 194(I) of the Act. On the facts and circumstances of case, such payments are liable to TDS u/s 194C of the Act and TDS cannot be once again recovered where the proper tax has been paid by the payee on such income." 3. The brief facts of the case are that TDS survey u/s 133A was carried out from 08-09-2008 to 16-09-2008 at the premises of the assessee. The assessee runs a port at Kandla. During the course of survey it was noticed that the assessee has taken on rent various vehicles, like cars, jeeps from travel agencies. It has also hired a tug boat, named "Ocean Sparkle" on daily basis. The assessee used to make TDS u/s 194C of the Act from the payment made to travel agency and the owner of the tug boat. The department was of the view that such payments covered under the provisions of ....
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....ssees own case in Kandla Port Trust V/s DCIT in ITA No.771 and 924/Rjt/2010 (AYs-2008-09 & 2007-08) dated 11.11.2011 and the Tribunal decided the appeals in favour of the assessee and hence the issues raised in this appeal stand covered by the afore said decision. As against this the ld. DR could not point out anything to take different view than the view so taken by the Tribunal earlier. 9. After hearing both the sides, we find that the Tribunal has decided these issues in assessee's own case (supra) for the assessment years 2008-09 and 2007-08, the relevant portion of the said order is reproduced below: 14. We have heard the ld.representatives of the parties, record perused and gone have through the decisions cited. The issue under consideration is whether Annual maintenance contact, pilotage contract and vehicle hire contracts cover under section 194C or u/s 194J and 194-I of the Act. The assessee deducted tax at source under section 194C. The revenue is of the view that annual maintenance contract and pilotage contract are in the nature of technical services, therefore, falls under section 194J and vehicle contract is rent contract therefore section 194....
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....ussion we find that fee for technical services includes payment of consideration for rendering of following services: (a) managerial, (b) technical or consultancy services (c) provision of services of technical or other personnel. 16. 'Fee for technical services' does not includes following consideration - (i) Construction (ii) Assembly (iii) Mining or like project 17. A perusal of annual maintenance contract between assessee and M/s Mcnally Bharat Engineering Company Ltd, OTIS Elevators, we notice that the AM contractor shall carry out all repairs as per detailed description in the agreements. From these agreements we did not find that these contracts were in respect of managerial or technical or consultancy services. Thus, it is clear that these agreements were related to annual maintenance of machineries and not for technical services. The revenue in view of the fact that the contractors have utilized services of technical persons presumed that the assessee made payments for technical services. For this pr....
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....ent shall at the item of credit for such income to the account of the payee or at the time of payment thereof in cash or by issue of cheque or draft or by any other mode, whichever is earlier, deduct income-tax thereon at the prescribed rate. Explanation (i) to section 194-I defines "rent" as "payment for land or building including factory building or land appurtenant to the building including the factory building or machinery or plant or equipment or furniture or fittings whether or not any or whole of the above are owned by the payee. In the case under consideration. The assessee entered into agreement with Thakkar Travels for hiring of vehicles, Tata Indo, Diesel Tata Sumo, Tata Qualis, Honda City and Maruti, etc. In the said agreement it is provided that the rates at which the payments will be made for normal running of 12 hours from time of reporting and for deployment beyond 12 hours. In the agreement nowhere it is stated that the possession of the vehicles were given to the assessee. The ITAT, Mumbai Bench in the case of Vodafone Essar Ltd vs DCIT 135 TTJ (Mum)385 while dealing with section 194I held that merely making use of the facility without himself using the equipment ....