2013 (12) TMI 663

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.... deleting the disallowance of Rs. 2,76,682/- made u/s 40A(3) of the Income Tax Act, 1961. 3. We have heard the rival submissions carefull y and perused the entire record available before us. We have also gone through the paper book filed by the parties. 4. Briefl y stated, the facts of the case are that the assessee is engaged in the business of hiring of buses. The Assessing Officer required the assessee to furnish details of hire charges paid to various persons. The assessee complied with and filed entire records. The assessee had paid Rs. 43,24,081/- towards total hire charges. From the details so filed, the Assessing Officer noticed that the assessee had failed to deduct tax at source, therefore, the Assessing Officer show caused ....

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.... assessee did not execute an y transport contract with the bus owners. In support, affidavits of the bus owners enclosed vide letter dated 5.12.2008 were produced. The recipients clearl y stated that they have received onl y rent from the assessee. Therefore, it was explained that rent of letting out of buses is not subject to TDS u/s 194-I of the Act. Since the letting out of machinery, plant and equipments is not covered u/s 194-I of the Act for TDS provisions, the assessee has not deducted an y TDS out of payments made towards rent of buses. It was further explained that in similar facts in assessment year 2005-06, even when the assessment was made u/s 143(3) of the Act, the Assessing Officer has accepted similar arguments as correct. Bu....

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....ve given their buses to him. The fact that in the immediatel y preceding assessment year, on identical facts, the Assessing Officer has accepted the claim of the assessee that the buses were taken by him on monthl y rent, are not taken under a contract. The Assessing Officer in assessment year 2005- 06 while making assessment u/s 143(3) has accepted that section 194C is not applicable in the case of the assessee in respect of hire charges paid to the owners of the buses. The facts in this year have not changed and it is an admitted fact, therefore, the findings of the learned CIT(A) cannot be faltered and, therefore, no interference by us is warranted. Accordingl y, this ground of the revenue's appeal cannot be allowed and hence stands dism....