TaxTMI 
TaxTMI 
2015 (7) TMI 1074
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....o-border-alt:solid windowtext .5pt; mso-padding-alt:0cm 5.4pt 0cm 5.4pt; mso-border-insideh:.5pt solid windowtext; mso-border-insidev:.5pt solid windowtext; mso-para-margin:0cm; mso-para-margin-bottom:.0001pt; mso-pagination:widow-orphan; font-size:11.0pt; font-family:"Calibri","sans-serif"; mso-ascii-font-family:Calibri; mso-ascii-theme-font:minor-latin; mso-hansi-font-family:Calibri; mso-hansi-theme-font:minor-latin; mso-fareast-language:EN-US;} SHRI R.P. TOLANI, JUDICIAL MEMBER For the Appellant : Shri P.C. Parwal, CA For the Respondent : Shri Raj Mehra, JCIT ORDER PER R.P. TOLANI, JM These are cross appeals filed by assessee and revenue, against the order of the ld. CIT(A)-III, Jaipur dated 28-01-2013 for the assessment year 2008-09. 2.1 The assessee has raised following grounds in its appeal. ''1. The ld. CIT(A) has erred on facts and in law in holding the cess paid to RCDF is in the nature of fees for professional for technical services, liable for deduction of tax u/s 194J land they confirming the action of the AO in holding that the same is not allowable u/s 40(a)(ia) of the Act since the assessee has not deducted the tax at....
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.... u/s 194J of the Act and not u/s 194H as held by the AO. However ld CIT(A) reduced the disallowance by relying on judgment of M/s. Merilyn Shipping & Transport (70 DTR 81) (Vizag) SB and Jaipur Bench in the case of JVVNL (supra) that provisions of Section 40(a)(ia) are applicable qua the outstanding payments at the end of the year. Ld. AO was directed to verify the outstanding amount payable to RCDF and allow the expenditure to that extent. Both the parties are in appeal. The assessee is by way of Ground No. 1 and Revenue is by way of Ground No. 1. 3.3 The AO further enquired into the claim of expenditure of Rs. 54,73,480/- on account of milk purchase difference Cess. The assessee filed detailed reply contending that the amount was paid @ 2.5% to District Primary Cooperative Societies (for short ''DPCS'') for maintaining their activities of collecting milk and to Primary District Cooperative Society (for short '' PDCS) @ 2% on milk purchased. Since the payment was made to these societies for maintaining the cooperative activities of the societies and meeting their expenses, the payments were not liable for TDS provisions. The AO however, held it to be liable for TDS u/s 194H....
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....was paid to RCDF, Rs. 66,312/- was paid to Bansal Printers and Rs. 24,410/- was paid to M/s. Mahalaxmi Welding Workshop for advertisement. AO disallowed these expenditure u/s 40(a)(ia) since no tax was deducted at source on these payments. 04.2 Ld. AR submitted that the advertisement charges was actually incurred by RCDF and due TDS was made by RCDF at the time of making payment to respective parties. The appellant reimbursed the expenses to RCDF who has filed the return showing such receipts. Ld A.R. claimed that the liability to make TDS was on RCDF and not on the appellant. It was alternatively claimed that since the entire payment was made during the year itself, provisions of Section 40(a)(ia) are not applicable on these payments. In respect of payments made to Bansal Printers and M/s. Mahalaxmi Welding Workshop, ld. AR produced the relevant invoices to show that the payments were made for the purchase of printed banners and iron frame. The payment was not for the advertisement. 04.3 On due consideration of the appellants arguments and the evidences produced, the disallowance made by AO u/s 40(a)(ia) in respect of aforesaid expenditure, is deleted. The payments made t....
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.... purchases the milk from various primary co-operative societies who raises the bill for the milk and for their margin named 'milk price difference'. These primary co-operative societies are constituted by the milk producers for the purpose of collective disposal of milk produce by them. The assessee society purchases milk directly from the primary societies on principal to principal basis. Therefore, the payment of the milk to the primary co-operative societies along with the fixed margin called 'milk price difference' is only a payment towards purchase of milk and not a payment of any commission or brokerage since the transaction is between principal to principal. Commission is paid to a person when he acts on behalf of other person. In such a case, the payment for value of the goods or service is made directly to the owner of goods/ provider of service and the payment of commission is made separately to the person who is acting on behalf of the owner of goods or provider of service. In the present case, the assessee is making payment of the milk to the primary society and not to the cattle owners. Therefore, the observation of the AO that the assessee purchases milk from individu....