2011 (8) TMI 1158

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....eal are as under:- ''1. Under the facts and circumstances of the case, the ld. CIT(A) is not justified in confirming the order of the AO whereby the AO has held the appellant liable for deduction of tax at source u/s 194C of Income Tax Act, 1961 in respect of payment made to RSAMB for construction projects and consequently held the appellant liable for tax deductible and interest of Rs. 602183/- u/s 201/201(1A) of the Income Tax Act. 2. Under the facts and circumstances of the case, the ld. CIT(A) is not justified in confirming the order of the AO whereby the AO has held the appellant liable for deduction of tax at source u/s 194J of Income Tax Act, 1961 in respect of payment made to RSAMB towards statutory contribution an....

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....d submits the same for sanction to the Board. It is the Board which is looking after the improvement and regulation of agricultural markets in the State. The works of planning and development of infrastructure i.e. construction and maintenance of roads within the market area an approach roads etc. are executed and carried out by the Board. 17. It is not in dispute that the amount given by the assessee to the Board for specific purpose on the approval of the project by thee State Govt. The learned Tribunal has rightly observed that the amount given is not a voluntary contribution by the assessee but towards the achievement of the object set out in the Act for which the assessee came into existence. It is not even the case of the rev....

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.....'' 2.2 It has been held that by Hon'ble Jurisdictional High Court that the works of planning and development of infrastructure i.e. construction and maintenance of roads within the market area and approach roads etc. are executed and carried out by the Board. Thus these works are carried out by the Boards and not by the committee. Hence, Section 194C will not be applicable in the case of the assessee. It is an agricultural marketing Board who is executing and carrying out the works. Hence, there was no requirement of making deduction u/s 194C of the Act by the assessee . 2.3 In respect of contribution the Rajasthan State Agricultural Marketing Board, the AO is of the view that the tax is required to be deducted at source u/s 194J....