TaxTMI 
TaxTMI 
2013 (5) TMI 196
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....lusive definition of "work" in Expl.III to sec. 194C which includes transportation of goods by any means and, therefore, the assessee was liable to deduct tax at source on such payments. ii) Ld. Commissioner of Income Tax (A) has also erred in law and on facts in allowing relief to the assessee without appreciating the fact that since the assessee has defaulted in fulfilling the provisions of section 194C, the Assessing Officer has rightly disallowed the expenditure by invoking the provisions of sec. 40(a)(ia). iii) Ld. Commissioner of Income Tax (A) has erred in relying upon the case laws which have been rendered vis-a-vis the law as it stood before the insertion of Expl.III to sec. 194C w.e.f. 1.7.1995 and which cannot have any bearing ....
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....of provisions of section 194C and Circular No. 681 dated 8.3.1994 following ingredients are required to be present for any payment to the covered u/s. 194C of the Act: i) There has to be a written or oral contract between any person responsible for paying any sum to any resident and the recipient of the said sum. ii) 'Work' shall include carriage of goods or passengers by any mode of transport other than by railways. iii) 'Goods Carriage' shall have the meaning assigned to it in the Explanation to Sec. 44AE(7) of the Act. 4.1 Ld. Commissioner of Income Tax (A) observed that in this case from the assessment order, it is clear that there is no evidence on of any contract between the mule owners and the assessee. Ld. Commissioner of Income....
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....entity from its operation of it if it is below a certain amount per year. He held that it is likely that a substantial quantum, if not all, of payment would be below the exemption limit in this case. In this regard, he placed reliance upon the decision of the Hon'ble Bombay High Court in the case of Bhagwati Steels reported at 326 ITR 108 (P&H). Ld. Commissioner of Income Tax (A) further observed that the Assessing Officer's contention that assessee has subsequently deducted tax at source and deposited the same in Government Account cannot take away anything from the merits of the case. Considering the aforesaid, Ld. Commissioner of Income Tax (A) held that assessee was not liable to deduct tax at source on payment made to mule owners u/s. ....
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....ion 194(C) of the Act are not applicable in this case and consequently no addition u/s. 40a(ia) can be made. In the case of Chandrakant Thacker vs. ACIT (Supra), the Tribunal held that Revenue having not brought any material on record to establish that the hiring of vehicles by the assessee transporter from truck owners and the payments therefor were in consequence of any written or oral agreement, provisions of section 194C were not applicable to the payments of freight or hiring charges made by the assessee to the truck owners and the same could not be disallowed u/s. 40(a)(ia) of the Act. 6.2 We further find that Hon'ble Punjab and Haryana High Court in the case of C.I.T (TDS) vs. United Rice Land Ltd. (Supra) has held that there was ne....