2013 (12) TMI 1046

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..... The grounds of Revenue's appeal and Assessee's C.O. are as under:- ITA No. 3317/Ahd/2010 (Revenue's Appeal) "1. The Ld. CIT(A) erred in law as well as on facts of the case in deleting the order passed u/s. 201(1) of Rs. 1,32,482/- & interest charged u/s. 201(1A) of the IT Act of Rs. 23,76,350/- respectively for A.Y. 2009-10 by the A.O. 2. The Ld. CIT(A) erred in not considering the fact that after 13.7.2006 the provision of 194I is applicable on hiring charges of vehicle of Rs. 1,50,70,235/- which cover uses of plant and machinery and not the provision of 194C of I.T. Act. 3. The Ld. CIT(A) erred in not considering the fact that after 13.7.2006 the provision of 194I is applicable on hiring charges of connecting charges of Rs. ....

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....Rs. 9,08,01,588/- iii. Gas transportation Charges Rs. 3,58,44,097/- On verification of the TDS details, it was seen that the appellant had made TDS u/s.194C @ 2.266% on the above payments. The ld. A.O. found that these payments having nature of rent within Section 194I of the IT Act. Thus, tax is required to be deducted @11.33% u/s. 194I of the IT Act. Ld. ACIT, TDS Circle had given reasonable opportunity of being heard on this issue. The appellant also replied vide various letters before the ACIT, TDS Circle. The appellant claimed before the ACIT that vehicle hiring charges were for contract on fixed contract, was fixed basis on rate per km. Vehicles as well as chauffer drivers were under the control of the Contractor. Therefore, ....

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....ategorically covers transportation and contractor is obliged to provide particular type of vehicle but not the same vehicle, contractor has to bear cost of running and maintenance, repair and insurance etc. and obliged to provide another similar vehicle in case of break down. The appellant had to make payment based on km. used and not on fixed basis. These were uncontroverted facts and even the A.O. has also not disputed in all the material facts stated by the appellant like vehicle at all the times being under the supervision and control of the transporter charging of consideration based on kms. Traveled etc. Therefore, the contract is for carrying out of some work for the appellant and it cannot be called a contract where vehicle simplici....

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....pment Authority vs. ACIT, TDS Circle, for hiring of car on fixed rent payment. ii. ITA No. 387/RJT/2009 for A.Y. 07-08 in case of Reliance Industries Ltd. vs. ACIT, TDS Circle, for import detention or demurrage charges, hire charges for vehicles, aircraft etc. and charges for Annual Maintenance Contract for Plant and Machinery. iii. CIT (TDS) vs. Swayam Shipping Services (P.) Ltd. (2011) 11 taxmann.com 137 (Guj.) for freight and transportation works contracts. iv. CIT(TDS) vs. Krishak Bharati Co-operative Ltd. [2012] 349 ITR 68 (Guj.) for charges for transportation of natural gas to seller not liable to be deducted TDS u/s. 194C. v. Chhattisgarh State Electricity Board vs. ITO (TDS) [2012] 18 taxmann.com 150 (Mum.) for transmitt....