2016 (7) TMI 926

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....2003-04, the revenue has preferred the present Tax Appeal for consideration of the following substantial question of law: Whether the Income Tax Appellate Tribunal is right in law and on facts in holding that the assessee was not liable to deduct tax at source under section 194 C of the Income Tax Act, 1961 from the payments made to Mukadams and Transporters? 3. The assessee is engaged in the business of manufacturing of sugar from sugarcane. On verification of TDS it was noticed that the assessee was not deducting tax on payment to contractors i.e. payments made to mukadams and transporters. The Assessing Officer held that the assessee was responsible for making the payment and not deducting tax on such payments. On appeal, the CIT (....

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....nt to refer to the decision of this Court in CIT (TDS) VS. KRISHAK BHARTI COOPERATIVE LTD.(Supra). In that case, the assessee was engaged in the manufacture of fertilizers and for the said purpose, it used to consume natural gas. The assessee, therein, was supplied natural gas by different agencies through pipelines. In that case, according to the Revenue, while purchasing the gas from different agencies, the assessee had entered into a work contract for transportation of natural gas from the sellers premises to the buyers consumption point, and therefore, they held that the assessee, therein, was required to deduct TDS. However, this Court, in that case, held that to transport the gas was a part of sale transaction, and therefore, the asse....